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Report Sees Retirement Plan Growth: Average 401(k) Up 25 Percent
By Brett Arends, Herald.com
September 30, 2004
The average 401(k) retirement plan grew 25 percent last year as investors continued to save and the stock market rallied, Fidelity reported yesterday.
The fund management company, the nation's biggest administrator of company plans, said the average balance reached $55,000 by the end of fiscal 2003.
And those participating continued to save about 7 percent of their salary, the same level as in previous years.
But a growing number of workers are opting out. Just over a third of eligible workers are not participating in their plans.
And of those who are using a 401(k) plan to save for their retirement, barely one in ten is saving the $12,000 maximum allowed each year.
The findings from Fidelity's fifth annual Building Futures survey seem to confirm suspicions that a disturbing number of Americans are undersaving for their retirement years.
Fidelity culled the data from all the retirement plans it manages.
It operates more than 10,000 different company plans, with 8.2 million members.
The money management giant in total manages $1 trillion in assets.
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