The Surging Growth of 401(k) Millionaires

The number of employees with 401(k) balances over $1 million increased by 26% in the second quarter, reaching 378,000, according to Fidelity Investments. The average 401(k) balance for these investors was $1.5 million. The overall average retirement account balances also climbed for the third straight quarter. Fidelity's analysis showed that workers who consistently contributed to their retirement plans, even during market downturns, saw significant growth in their account balances. Additionally, there was a notable increase in young workers investing in 401(k) accounts, with Gen Z workers showing a 66% year-over-year increase. However, there is concern that the end of the student loan payment pause in October could impact retirement savings for borrowers. Legislation passed last year may help keep student loan borrowers on track by allowing employers to make retirement contributions based on their loan payments.