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Member, Beacon International Group, Ltd.
Employees' 401(k) plan account balances increased slightly during the second quarter of 2016 but are still lower than a year ago, Fidelity Investments said in an analysis released Tuesday.
The average account balance was $88,900 as of June 30, compared with an average balance of $87,300 as of March 31, a 1.8% increase, the Boston-based mutual fund provider and 401(k) plan administrator said in a statement.
“Most retirement savers are accustomed to market volatility, but the swings in the second quarter were especially dramatic, including a 600-point drop followed by a nearly 800-point increase,” Doug Fisher, Fidelity Investments' senior vice president of workplace investing in Boston said in the statement.
While account balances moved up during the first quarter, they are 2.5% lower compared to a year ago, when they averaged $91,100,
Not surprisingly, account balances were much higher for employees who have participated in 401(k) plans for many years.
At the end of June, the average account balance for employees who have participated in the plans for at least 10 years was $241,300. That's up 4.2% from $231,500 a year ago.
The analysis is based on 22,000 plans with 14.2 million participants.
The assets of 401(k) plans and of mutual fund target-date funds reached records in the quarter ended March 31, the Investment Company Institute reported Thursday in its quarterly review of retirement assets.