You’ve probably heard stories about 401(k) millionaires – people who’ve managed to save $1 million or more in their retirement accounts. And while those stories are inspiring, they can also feel slightly misleading. Yes, there are more 401(k) millionaires today than ever before, but here’s the reality: they’re still a very small group.
Depending on the source, the percentage of people with $1 million in their 401(k) hovers between 2% and 9.1%. Fidelity Investments reports that just 2% of their 401(k) participants have hit that milestone. Broader data, like that from Empower Personal Dashboard™, suggests the figure is slightly higher when you include IRAs and other savings, with 9.1% of retirement savers reaching millionaire status. Either way, the takeaway is the same – it’s not common.
Don’t Miss:
For most Americans, reaching $1 million in a 401(k) account is a significant challenge. It’s not impossible, but it’s also not the norm. In fact:
1. The Average Balance Is Much Lower
According to Fidelity, the average 401(k) balance was approximately $132,300 in late 2024. That’s far from seven figures and highlights how much work it takes to cross the $1 million threshold.
2. The Math Is Against Most People
Building $1 million in retirement savings typically requires decades of consistent saving, an employer match and strong market performance. On average, 401(k) millionaires have been saving for 26 years or more and contribute at least 17% of their income, according to USA Today.
3. Retirement Savings Gaps Persist
Many Americans are underprepared for retirement. Northwestern Mutual’s 2024 Planning & Progress Study found the average U.S. worker believes they’ll need $1.5 million to retire comfortably, but most aren’t on track to meet that goal.
See Also: The global games market is projected to generate $272B by the end of the year — for $0.55/share, this VC-backed startup with a 7M+ userbase gives investors easy access to this asset market.
It’s worth celebrating the rise in 401(k) millionaires, even if the numbers are small. Several factors are helping people hit this milestone:
• Stock Market Performance: The S&P 500 gained nearly 15% in the first half of 2024, significantly boosting account balances.
