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    401(k) Balances Drop 20%, Gen Z Sees Positive Growth


    The average balance of 401(k) retirement accounts saw a sharp decrease in 2022, with the average balance dropping from $130,700 in the fourth quarter of 2021 to $103,900 in the fourth quarter of 2022, according to Fidelity Investments.[0] The decrease marks a decrease of about 20%.[0] The total 401(k) savings rate, representing employer and employee contributions, for the fourth quarter held steady at 13.7%, slightly lower than Fidelity’s recommended savings rate of 15%.[1]

    Baby Boomers who have not retired had the highest average savings rate, at 16.5%.[2] Gen Z, in contrast, saw their 401(k) balances jump 23% during that same period of time, and were the only age group to see positive growth in their account balances, up 14% from the end of 2021.[3]

    The book of averages found small retirement plan (50 participants/$5 million in assets) fees declined from 1.12% to 1.09%.[4] “We are encouraged to see fees continue to decline for participants in small 401(k) plans,” said Joseph W. Valletta, author of the 401(k) Averages Book.[4] Employers of small businesses have much to consider when interpreting SECURE 2.0, but making slight modifications to their plan’s investment options and costs can result in considerable savings for their personnel.[5]

    However, the ranks of 401(k) millionaires have dropped significantly, with Fidelity Investments reporting 299,000 seven-figure workplace retirement accounts at the end of 2022, down from 442,000 a year prior.[6] “Year over year, the trends are consistent – if you start saving earlier and avoid reacting to market volatility, you will be better off in the long run,” said Fidelity Investments President of Personal Investing Joanna Rotenberg in a release.[7] The results of this study indicate that younger people are adhering to their plans and cultivating good savings practices – from budgeting daily costs and progressively increasing contributions to benefiting from an employer match.[8] It is especially essential to keep this in mind during times of inflation, when the money saved must stretch further.

    0. “Dollar downsize: Study finds retirement account balances decreased by almost 25% last year” Washington Examiner, 24 Feb. 2023,

    1. “Retirees lost 23% of their 401(k) savings in 2022, Fidelity says” CNBC, 23 Feb. 2023,

    2. “401(k) balances rise, despite economic and market challenges” kuna noticias y kuna radio, 23 Feb. 2023,

    3. “Here's What the Average 401(k) Is Worth After Dropping 20% Last Year” Yahoo Money, 24 Feb. 2023,

    4. “401k Averages Book Finds 401(k) Partcipant Investment Fees Declined 3%” EIN News, 22 Feb. 2023,

    5. “401(k) Plan Fees Decline (Again)” National Association of Plan Advisors, 22 Feb. 2023,

    6. “401(k) millionaires decreased, yet retirement account balances are up.” The Washington Post, 24 Feb. 2023,

    7. “401(k) and IRA Balances Plunged Over 20% in 2022” Investopedia, 23 Feb. 2023,

    8. “Retirement Savers Withstand 2022 Rollercoaster as Balances Rebound” National Association of Plan Advisors, 23 Feb. 2023,

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