Business lockdowns during the pandemic kept people from spending as much, thus increasing their savings.
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Saving for retirement is very important to have a livelihood in your golden years. Luckily, people seem to be understanding this more and more, as average retirement savings have reached an all-time high and even more people have retired millionaires.
According to an analysis by financial services company Fidelity, the average size of retirement accounts reached its third record.
The average balance in a 401 (k) retirement account is now $ 129,300, which would be $ 25,000 more than it was in the same period last year.
The number of people who, now that retired, have more than $ 1 million or more in savings also reached a new all-time high. for the next few years. This historical record is 753,600 savings accounts with this amount of money.
This number of savers is no less than double that registered a year agoAlthough it is still a small number compared to the more than 30 million retirement savings accounts that exist today.
It should be noted that people saving for retirement hit several records last year. And is that the S&P 500 has doubled since it reached its lowest point during the height of the pandemic.
In addition to the profits obtained in the Stock Market, business locks made people spend less money, and this has happened from 2020 to 2021. Because of this, many people ended up saving more than they used to.
Likewise, many people dedicated themselves to paying off their debts, so their credit scores improved as well.
More than a third of workers in the United States increased their retirement contributions in the past year, helping them save more money for the future thanks to compound interest.
The average 401 (k) contribution rate hit a record 9.3%, and that rate doesn’t even include company fringe payments.. With the company payment, the total retirement account contribution rate would increase to an average of 13.9%.
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