There's Now a Record Number of 401(k) Millionaires — But Can You Guess the Average Balance? Hint: It's Nowhere Near $1 Million

Core Insights - The number of 401(k) millionaires in the U.S. has reached a record 654,000, marking a nearly 10% increase from the previous quarter, driven by steady contributions and market momentum [1][3] - Despite the increase in millionaires, the average 401(k) balance is only $144,400, indicating a disparity between the wealthiest accounts and the average saver [2][3] Group 1: 401(k) Millionaires - Fidelity's report highlights a significant rise in 401(k) millionaires, from 595,000 to 654,000 in just one quarter [3] - This growth is primarily attributed to high earners and long-term savers, while the average balance remains low for most participants [3][4] Group 2: Average Balances and Growth - The average balance for IRA accounts is $137,902, while 403(b) plans average $131,200, reflecting the broader retirement savings landscape [7] - Long-term savers, particularly women contributing for 15 consecutive years, have seen their average balance rise to $501,100, a 16.5% increase from the previous year [5] Group 3: Changing Investment Trends - Younger investors, especially Gen Z, are increasingly directing their 401(k) contributions to Roth accounts, with 95% of their contributions going to these accounts, surpassing Millennials at 75% and Gen X at 66% [5]