Fueled by a strong equities market, employees' 401(k) plan account balances hit a record high at the end of last year, Fidelity Investments said in an analysis released Thursday.
The average account balance was $89,300 at the end of 2013, up from $77,300 at year-end 2012, a 15.5% increase, the Boston-based mutual fund provider and 401(k) plan administrator reported in an analysis.
Seventy-eight percent of the 2013 account balance increase was the result of stock market gains, while 22% was due to plan contributions, Fidelity said.
Account balances are dramatically higher than a few years ago when participants' equity investments were battered during the Great Recession. For example, last year's $89,300 average account balance is nearly twice as high compared with March 2009, when participants' account balances averaged $46,200, according to Fidelity.
Average account balances were directly tied to participants' age, a result of older employees having contributed to their accounts longer than younger employees, while older employees' accounts have earned investment income for a longer period of time, and older participants also tend to have higher disposable incomes.
For example, at the end of 2013, the average account balance of participants born between 1979 and 1991 was $19,400. By contrast, the average account balance of participants born between 1946 and 1964 averaged $165,200, according to Fidelity.
The analysis is based on 21,200 plans with 12.5 million participants.