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Retirement account balances dip in Q1 2025 as savings rates hit record high

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Retirement account balances dipped in the first quarter due to stock market turbulence. Still, people kept socking away money for their retirement, according to new data from Fidelity Investments. 

The financial services company analyzed more than 50 million retirement accounts, finding that the average balances of 401(k), IRA and 403(b) accounts all saw small declines during the first three months of 2025. 

The average 401(k) account balance decreased 3% quarter over quarter to $127,100, according to Fidelity Investment’s Q1 2025 retirement analysis.

401

IRA accounts had average balances of $121,983 and 403(b) accounts held $115,424 on average in the first quarter, 4% and 2% lower than the prior quarter, respectively. 

THIS MIDWESTERN STATE IS CONSIDERED ONE OF THE BEST PLACES TO RETIRE, NEW STUDY SAYS: SEE THE LIST

Fidelity largely attributed those declines to “market swings.” 

The market was turbulent during the first quarter amid uncertainty surrounding tariffs and other policy issues, including popular index funds. 

Still, retirement savings rates “stayed consistently high,” according to Fidelity. 

For 401(k) accounts, employee contribution rates hit 9.5% during the first quarter, with the employer contribution rate coming in at 4.8%, according to its analysis. 

Savings jar

Combined, the 14.3% savings rate for 401(k) accounts marked a “record” and the “closest it’s ever been to Fidelity’s suggested savings rate of 15%,” the company said. 

RETIREMENT PLANNING: THE DIFFERENCES BETWEEN A TRADITIONAL AND ROTH IRA

Holders of 403(b) accounts, meanwhile, had a rate of 11.8% on average. 

“Although the first quarter of 2025 posed challenges for retirement savers, it’s encouraging to see people take a continuous savings approach which focuses on their long-term retirement goals,” Sharon Brovelli, president of workplace investing at Fidelity, said in a statement. “This approach will help individuals weather any type of market turmoil and stay on track to reach their retirement goals.” 

During the first quarter, which was plagued with market volatility, 17.4% of 401(k) holders upped the size of their contributions, while only 4.9% lowered theirs, the report found. 

401k statement shown on table

Meanwhile, contribution rates among 14.6% of 403(b) holders went up in the first quarter. 

Only a small percentage of people with those types of retirement plans altered their asset allocation during the first quarter, with just 6% of 401(k) users doing so and 4.7% for 403(b), it found. 

NEARLY HALF OF GENERATION X IS NOT CONFIDENT ABOUT RETIREMENT, SURVEY FINDS

Fidelity’s analysis also showed that people with IRAs upped the amount of money that they put in those retirement accounts in the first quarter by 4.5% compared to 2024’s first quarter. 

separate survey released Monday by Gallup found 59% of U.S. adults have funds put away in a retirement savings account.

Among those with retirement savings plans that have not yet left the workforce, half reported they “expect to have enough to live comfortably in retirement,” according to Gallup. 

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Citigroup lifts banking curbs on gun makers and sellers

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Signage at a Citibank branch in New York, US, on Sunday, Jan. 12, 2025.

Michael Nagle | Bloomberg | Getty Images

Citigroup on Tuesday ended a seven-year-old policy restricting how it provides banking services to firearm manufacturers, sellers and resellers.

The bank launched the policy in March 2018 after a teenage gunman killed 17 people and injured more than a dozen in a mass shooting at Marjory Stoneman Douglas High School in Parkland, Florida, on Feb. 14 that year.

Citi said at the time that it would require clients to “adhere to these best practices: (1) they don’t sell firearms to someone who hasn’t passed a background check, (2) they restrict the sale of firearms for individuals under 21 years of age, and (3) they don’t sell bump stocks or high-capacity magazines.”

The bank’s policy applied only to its business clients, ranging from small businesses to Fortune 500-sized companies. It did not restrict how Citi’s personal banking customers used their cards. Citi says it provides banking services to more than 19,000 companies globally.

“As a society, we all know that something needs to change. And as a company, we feel we must do our part,” Citigroup Executive Vice President of Enterprise Services and Public Affairs Ed Skyler said in 2018.

But Skyler says things have changed. “The policy was intended to promote the adoption of best sales practices as prudent risk management and didn’t address the manufacturing of firearms,” he wrote Tuesday in a blog post announcing that Citi “will no longer have a specific policy as it relates to firearms.”

“Many retailers have been following these best practices,” Skyler wrote, “and we hope communities and lawmakers will continue to seek out ways to prevent the tragic consequences of gun violence.”

A spokesperson for the March for Our Lives, a gun-control advocacy group organized in part by students who survived the Parkland massacre, didn’t immediately respond to a request for comment.

The change at Citigroup comes amid broader political pressure over so-called “debanking,” with influential tech leaders and right-wing officials having alleged in recent years that the Biden administration was improperly blocking certain people, including cryptocurrency proponents and conservatives, from banking services.

That argument hasn’t gone away since President Donald Trump returned to the White House; he confronted the CEOs of America’s two largest banks — Bank of America and JPMorgan Chase — with similar complaints at the World Economic Forum in Davos, Switzerland, earlier this year. Both banks said at the time that they would never close an account for political reasons. Bank of America said, “We welcome conservatives and have no political litmus test.”

Citi said Tuesday that it would “update our employee Code of Conduct and our customer-facing Global Financial Access Policy to clearly state that we do not discriminate on the basis of political affiliation in the same way we are clear that we do not discriminate on the basis of other traits such as race and religion. This will codify what we’ve long practiced, and we will continue to conduct trainings to ensure compliance.”

Banking executives have repeatedly said they terminate banking services only when there are issues with anti-money laundering laws or know-your-client regulations, not because of political affiliations.

“We bank 70 million American consumers so our bank is open to everybody,” Bank of American CEO Brian Moynihan later said.

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