Markets can rise fast, but so can pressure behind the scenes. President Donald Trump has pointed to growing retirement balances as a clear sign of economic strength, yet new data suggests many Americans are still reaching into those accounts to stay afloat.
During a December rally at the Mount Airy Casino Resort in Mount Pocono, Pennsylvania, Trump tied market gains directly to retirement savings. “I mean, the only thing that it’s really going up big, it’s called the stock market and your 401(k)s,” Trump said.
That message carried into Washington. In his State of the Union address last month, Trump said “your 401(k)s are way up.” He added, “Since I took office, the typical 401(k) balance is up by at least $30,000.”
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The data backs up part of that claim. Fidelity Investments, the nation’s largest 401(k) provider, reported the average 401(k) balance rose to $146,400 in 2025, an increase of $14,700, or 11%, year over year.
Individual retirement accounts followed a similar path. The average IRA balance climbed to $137,095, up $9,561 or 7% from the previous year.
Vanguard reported even broader gains across retirement plans. The average account balance reached $167,970 in 2025, a 13% increase, largely driven by strong market performance throughout the year.
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While balances grew, borrowing activity ticked up as well. Fidelity found 19.4% of participants had an outstanding 401(k) loan in 2025, up slightly from 18.9% the year before.
More telling is the rise in hardship withdrawals, a separate category that reflects deeper financial strain. Fidelity reported 2.7% of participants took a hardship withdrawal in 2025, up from 2.5% in 2024.
Vanguard’s data paints an even clearer picture. Roughly 6% of workers took a hardship withdrawal in 2025, marking a record high and a sharp increase from pre-pandemic levels.
The reasons behind those withdrawals point to real financial strain. Vanguard found the median hardship withdrawal was $1,900.
The most common reasons were preventing foreclosure or eviction, which accounted for 36% of withdrawals, followed by medical expenses at 31%.
Housing pressure is a major factor. ATTOM Data reported 367,460 U.S. properties had foreclosure filings in 2025, up 14% from the prior year.
That trend has continued into 2026. February alone saw 38,840 properties with foreclosure filings, a 20% increase year over year, while foreclosure starts rose 14% to 25,928.
More than one-third of hardship withdrawals are going toward keeping a roof overhead.
The contrast is hard to ignore. Retirement balances are climbing, fueled by market gains, yet a growing share of savers are pulling money out early.
For some households, rising account values may look reassuring on paper. But the increase in withdrawals suggests that for many, those gains are being offset by immediate financial needs.
Even as retirement balances rise, some investors are looking for ways to position their portfolios to capture market momentum — for example, with diversified or sector-focused ETFs like those offered by Direxion.
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This article Trump Says ‘The Only Thing Really Going Up Big’ Is Your 401(k)s — But Hardship Withdrawals Just Hit a Record High originally appeared on Benzinga.com
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