Finance
401(k) balances hit second highest on record: Fidelity
Ramsey Solutions financial expert George Kamel weighs in on Americans working past retirement age and provides advice for investors.
Balances for 401(k) retirement accounts hit the “second-highest average on record” in the final quarter of 2024, according to new data from Fidelity Investments.
The financial services company found in its newly-released fourth-quarter retirement analysis that balances for that type of retirement plan averaged $131,700.
That figure marked a jump of 11% year-over-year, according to Fidelity.
Close up of a 401(k) statement with a pie chart indicating asset allocation.To see more of my financial images click on the link below: (iStock / iStock)
Compared to 2024’s third quarter, however, average balances for 401(k)s posted a 0.5% decline, the analysis showed. The third-quarter was when 401(k) plans notched their “highest average on record” for balances, with an average of $132,300.
The rate at which 401(k) retirement plan holders socked away money inched up year-over-year to 14.1% in the fourth quarter, according to Fidelity.
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Similar to 401(k)s, average balances for two other popular retirement vehicles – IRAs and 403(b)s – saw small declines of 1% from the third quarter but showed year-over-year increases.
Fidelity pegged the average balance for 403(b) accounts at $117,800 in the fourth quarter, up 11% compared to a year ago.
Meanwhile, IRA accounts held average balances of $127,543. That’s an increase of 8% from the fourth quarter of 2023, according to the report.
A senior couple using a laptop to help organize their retirement plans. (iStock)
Fidelity’s fourth-quarter analysis included over 50 million retirement accounts.
Overall, the financial services company said people building nest eggs “experienced a year of positive growth” in 2024.
Retirement contribution rates went up for almost 40% of those saving for their golden years, Fidelity also reported. On average, the increase was 2.9%.
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“As we have for several quarters now, we observed upwards savings trends in Q4. This is encouraging news and is particularly important for many Gen X savers, who are able to make catch-up contributions,” Head of Fidelity Wealth Roger Stiles said in a statement. “This is an important consideration as the April tax deadline approaches where investors may be able to contribute to an IRA for potential tax deductions for 2024.”
The deadline for individual tax return filing is April 15, according to the IRS.
Fidelity also highlighted the retirement saving efforts of Generation X – people born between 1965 and 1980 – in its latest analysis.
When it came to IRAs, Gen Xers boosted their average contributions 16% year-over-year, according to the financial services company.
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Meanwhile, Gen Xers that have been putting money in 401(k) accounts regularly over 15 years achieved average account balances of $589,400, a jump of 18% from the same period last year, per Fidelity.
A person puts money into a retirement savings jar. (iStock / iStock)
Americans think $1.46 million is the amount of money necessary to experience a comfortable retirement, according to a study released by Northwestern Mutual last year.
The Transamerica Center for Retirement Studies found in an August 2024 report that the median age of retirement for middle-class retirees was 62.
People watch as Berkshire Hathaway chairman Warren Buffett is seen on a screen speaking at the Berkshire Hathaway Inc annual shareholders’ meeting, in Omaha, Nebraska, U.S., May 3, 2025.
Brendan McDermid | Reuters
Berkshire Hathaway shares are hanging on solidly Monday as investors process Warren Buffett‘s surprise announcement to step down and envision a new path for the conglomerate after his legendary 60-year run.
Buffett, 94, picked the very last moment at Berkshire’s annual meeting in Omaha, Nebraska, to tell his loyal shareholders that it’s time for Greg Abel, vice chairman of non-insurance operations, to replace him as CEO. The board voted unanimously on Sunday to make Abel president and CEO on Jan. 1, 2026, and for Buffett to remain as chairman.
Class B shares fell 2.9% in premarket trading Monday after hitting an all-time high at $539.80 Friday. Class A shares dropped 2.8% after closing at a record high at $809,350 apiece. Berkshire issued Class B shares in 1996 at a price equal to one-thirtieth of a Class A share. In 2010, Berkshire Class B shares split 50-for-1.
“Shareholders should welcome this transparent transition, but also have confidence that Warren isn’t going anywhere,” said Macrae Sykes, portfolio manager at Gabelli Funds and a Berkshire shareholder. “Retaining the position of Chairman means he can continue to mentor Greg and the Berkshire leaders, while also providing additional intellectual capacity when the inevitable time for more major capital allocation occurs.”
It marks an end of an epic era for Berkshire, which was a failing New England textile mill six decades ago when Buffett used an investment partnership he ran to take control. Berkshire has grown into a one-of-a-kind juggernaut worth nearly $1.2 trillion with businesses encompassing insurance, railroad, retail, manufacturing and energy. Buffett is handing over his reins on a particularly high note as Berkshire shares just reached a new peak Friday.
Berkshire Hathaway Class B shares
“Buffett leaves a company that is less reliant on his investing capabilities, with an array of leading businesses with strong cash flows,” Brian Meredith, UBS’ Berkshire analyst, said in a note. “Operationally, we expect little change at BRK and the culture/strategy to remain unchanged under Abel.”
The stock could also be reacting to Berkshire’s first-quarter results that showed a 14% decline in operating earnings, driven by a 48.6% plunge in insurance-underwriting profit. Berkshire said the Southern California wildfires led to a $1.1 billion loss during the period.
Berkshire shares have significantly outperformed the S&P 500, rising nearly 19% this year. Investors seeking relatively safe places to hide find Berkshire appealing because of the defensive nature of its huge insurance empire and the conglomerate’s unmatched balance sheet.
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