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Wednesday, April 2, 2025

401(k) millionaire count jumps to 544,000, says Fidelity

The number of 401(k) accounts exceeding $1 million in balance continues to grow steadily.

Fidelity, one of the largest retirement plan providers in the U.S., announced on December 5 that as of the third quarter of 2024, there were 544,000 401(k) accounts with balances over $1 million. This marks a 9.5% increase from the previous quarter’s 497,000 accounts, representing approximately 2.3% of Fidelity’s 24 million total account holders.

The average balance of these retirement millionaires was $1.616 million, up slightly from $1.595 million in the previous quarter.

The number of 401(k) accounts wirh more than 1 million dollar balance is increasing.

 

Generation X (ages 44–57) was found to have higher retirement account balances compared to other generations. Among Gen X participants who have been saving for over 15 years, the average balance reached $600,000, a 6% increase from the second quarter of 2024 and a 35% increase from the same period last year. This trend reflects Gen X’s efforts to boost savings as they approach retirement age.

Experts view the growth in retirement account balances as a positive sign for financial stability. However, they cautioned that polarization in retirement preparedness remains a significant issue. While the proportion of accounts with balances over $1 million is rising, a considerable number of accounts still have little to no savings.

According to Fidelity’s data, the median balance across all accounts stands at just $30,600. This indicates that more than half of Fidelity’s 24 million account holders have balances below $30,600. Experts attribute this disparity in part to younger individuals just starting to save for retirement, but also to insufficient savings among lower-income households.

Lower-income individuals, in particular, face challenges in growing their balances, often withdrawing from their 401(k) accounts early during financial emergencies. Early withdrawals before age 59.5 incur a 10% penalty and result in the loss of tax benefits from maintaining the account. As a result, the gap between those who consistently maintain their 401(k) accounts and those who withdraw early is expected to widen further.

BY WONHEE CHO [cho.wonhee@koreadaily.com]

 

Wonhee Cho
Wonhee Cho
Wonhee Cho is a journalist covering tech and finance, but also writes about food, sports, entrepreneurship, travel, and real estate. Prior to joining the Korea Daily, he built his career in public relations, specializing in the gaming and technology sectors, where he developed a deep understanding of the industry landscape and media strategy.