Americans See 401(k) Balances Hit Record Highs

By Sam StevensonShareNewsweek is a Trust Project member

Americans are experiencing record-high balances in their retirement savings accounts on the back of wider market gains, according to the latest data.

Why It Matters

Retirement savings form a core pillar of financial security for millions of Americans. The health of 401(k) and IRA balances signals not only the state of individual household finances but also the broader economic climate.

Record account highs observed in the third quarter of 2025 highlight the impact of persistent savings behaviors, a recovering stock market, and evolving generational strategies, offering a window into long-term trends in American wealth building for both current and future retirees.

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What To Know

Retirement account balances in the United States hit all-time highs in the third quarter of 2025, according to a new report released by Fidelity Investments.

The nation’s largest provider of 401(k) plans found that the average 401(k) account balance rose 9 percent year over year to $144,400.

Similarly, the average individual retirement account (IRA) balance rose 7 percent to $137,902.

The data, compiled by Fidelity and released November 20, signals the sixth consecutive quarter of quarter-over-quarter growth since mid-2023, despite ongoing economic concerns and stock market swings earlier in the year, reports Investment News.

Account balance increases were fueled by a combination of continued contributions and a rebound in the U.S. stock market.

The Dow Jones Industrial Average gained percent for the year through September 30, the S&P 500 advanced by 14 percent, and the Nasdaq Composite rose 17 percent.

Despite concerns over the economy and turbulence from new tariffs introduced earlier in the year, Americans maintained a steady average 401(k) contribution rate of 14.2 percent (including both employee and employer contributions).

While this remains just below Fidelity’s recommended savings rate of 15 percent, it reflects resilience and a long-term focus among savers.

The strong account growth also led to record numbers of so-called "401(k) millionaires."

Fidelity reported that the number of 401(k) accounts holding over $1 million jumped 10 percent from the previous quarter to reach 654,000, while IRA millionaires grew by 11.5 percent to 559,181 accounts as of September 30, 2025, per CNBC.

Younger generations, particularly Millennials and members of Gen Z, have been increasingly investing in Roth IRAs and Roth 401(k)s, which allow for tax-free withdrawals in retirement.

One in five Gen Z 401(k) participants is now directing their contributions into the Roth version, while 95 percent of Gen Z IRA contributions are now flowing into Roth accounts.

The popularity of Roth IRAs rose to 77 percent of all IRAs on Fidelity’s platform, up from 71 percent four years ago, per Investment News.

What People Are Saying

Robert Mascialino, president of wealth at Fidelity Investments, said: “Retirement is about taking a long-term view, and the growing interest in Roth products shows that investors recognize their potential for tax advantages and long-term growth.”

Mike Shamrell, Fidelity’s vice president of thought leadership, said: “We’re seeing a lot of positive behaviors among younger workers, especially Gen Z.”

Sharon Brovelli, president of workplace investing at Fidelity, said: “Americans are continuing to exhibit impactful savings behaviors such as staying the course and focusing on long-term goals, which clearly is having a positive effect on retirement savings.”

What Happens Next

More Americans may now be encouraged to save at even higher levels because contribution limits are set to rise in 2026. Roth 401(k) plans will allow up to $24,500 in annual contributions, while Roth IRAs will permit up to $7,500 for those under 50.

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