A record number of retirement savers are perched on a cool $1 million or more in their 401(k)s or IRAs, according to Fidelity Investments.
The pool of 401(k) millionaires climbed 16% from the end of March to reach an all-time high, totaling 595,000 at the end of June, per the survey.
It was quite a rebound from the first quarter when only 512,000 savers had at least $1 million in their nest egg, down from 537,000 at the end of last year.
Read more: What is a 401(k), and how does it work?
“Despite the market turbulence of early April, our data shows the majority of retirement savers stayed the course with their savings, choosing not to make any sudden moves and to continue to save,” Mike Shamrell, vice president of workplace thought leadership at Fidelity Investments, told Yahoo Finance. “As a result, these retirement savers were able to benefit from the market rebound that occurred later in the quarter.”
The number of people who hit the millionaire milepost seesaws with the market. And they make up a small percentage of Fidelity’s 401(k) participants.
The average 401(k)-created millionaire is roughly 59 years old and has been in their employer’s plan for an average of 25 years. Plus, they are seriously all in when it comes to saving. Their average individual savings rate is about 17.6%. If you add employer matches, it totals 26.2%.
In other words, they are reaping the rewards of maintaining what Shamrell calls a “long-term focus on retirement goals.”
Regular contributions are the crux of it all. Methodically adding funds to your accounts, regardless of what the market is up to, has a cumulative impact that’s pivotal to building wealth.
To that end, total average 401(k) savings rates held steady from earlier this year at a record high of 14.2%, a combination of employee and employer 401(k) contributions. This number remains close to Fidelity’s suggested savings rate of 15%.
Additionally, only 5.5% of retirement savers made a change to their 401(k) asset allocation from the end of March to the end of June.
Average account balances also reached new record highs in the second quarter.
Fidelity’s average 401(k) balance rose to $137,800, an increase of 8% from a year ago and a jump from $127,100 at the end of March.
Average balances for other plans also climbed: 403(b) accounts gained 9% to $125,400 from the first quarter, while individual retirement accounts rose 8% to $131,366 from the end of March.
The 401(k) data is based on 25,600 defined-contribution plans at various companies across the country, covering 24.6 million participants, as well as 7.8 million IRA accounts and 403(b) data on 10,677 tax-exempt plans, covering 9 million participants.
Story Continues
IRA account holders at Fidelity with $1 million or more saved jumped 16% to 501,481 at the end of June, up from 432,431 in the first quarter.
Although average IRA contributions have been constant over the past year ($2,223 vs. $2,225), contributions for both Gen X and boomers are on the rise, increasing by 25% for Gen Xers and 37% for boomers from the second quarter of 2024.
Learn more: The average retirement savings by age — how do you compare?
“These individuals are in their peak earning years, so they are able to save more, and with retirement nearing for some, many are ramping up their savings,” Rita Assaf, Fidelity’s vice president of retirement offerings, told Yahoo Finance.
Once you turn 50 years old, you’re eligible for an additional catch-up contribution of $7.500 to a 401(k) account. For the 2025 tax year, the standard IRA contribution limit is $7,000, so those 50 and older can contribute up to $8,000 in total by adding the $1,000 catch-up contribution
“We see many taking advantage of this,” Assaf said.
That doesn’t mean retirement savers aren’t worried. Concerns about the economy reached the highest levels since 2021, with 54% of respondents saying they were extremely or very concerned about the economy — up from 37% last year, according to the report.
Kerry Hannon is a Senior Columnist at Yahoo Finance. She is a career and retirement strategist and the author of 14 books, including the forthcoming “Retirement Bites: A Gen X Guide to Securing Your Financial Future,” “In Control at 50+: How to Succeed in the New World of Work,” and “Never Too Old to Get Rich.” Follow her on Bluesky.
Sign up for the Mind Your Money newsletter
Read the latest financial and business news from Yahoo Finance