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Don’t Let Your Money Turn to Dust in an Old 401(k)

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By Oliver Denker @ Shutterstock.com

If your money is collecting dust in an old 401(k), then consider doing an IRA rollover to Fidelity. It’s a non-taxable event, and you’ll be with my favored custodian. There’s a lot of money out there floating around. In The Wall Street Journal, Anne Tergesen reports that the number of 401(k) millionaires (those with at least $1 million in their 401(k)s) has increased by 25% this year. She writes:

Some 378,000 retirement savers in Fidelity plans had seven-figure-plus balances as of June 30, up from 299,000 at the end of 2022. The number of IRA millionaires increased by a similar percentage to nearly 350,000 on June 30, the nation’s largest retirement-plan and individual retirement-account provider said.

A balance of $1 million or more puts savers in the top 1.64% of all Fidelity 401(k) accounts. For IRA owners, it is the top 2.5%.

Not surprisingly, the rise and fall of retirement-account millionaires closely track the stock market’s moves.

This year’s increase in retirement-account millionaires coincides with the S&P 500’s 16.71% surge, including dividends, since Jan. 1. The Bloomberg U.S. Aggregate bond index, meanwhile, is up 0.31%.

In 2022, both bonds and stocks tumbled, taking the number of Fidelity 401(k) millionaires down by 32%.

Becoming a millionaire isn’t the sign of wealth it once was, thanks to inflation. But when it comes to saving for retirement, the milestone remains an aspirational target for many American workers, said Mike Shamrell, vice president at Fidelity.

“We aren’t saying $1 million is the perfect target,” he said. Given rising costs and the need to make nest eggs last decades, many savers will need more.

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E.J. Smith - Your Survival Guy

E.J. Smith is Founder of YourSurvivalGuy.com, Managing Director at Richard C. Young & Co., Ltd., a Managing Editor of Richardcyoung.com, and Editor-in-Chief of Youngresearch.com. His focus at all times is on preparing clients and readers for “Times Like These.” E.J. graduated from Babson College in Wellesley, Massachusetts, with a B.S. in finance and investments. In 1995, E.J. began his investment career at Fidelity Investments in Boston before joining Richard C. Young & Co., Ltd. in 1998. E.J. has trained at Sig Sauer Academy in Epping, NH. His first drum set was a 5-piece Slingerland with Zildjians. He grew-up worshiping Neil Peart (RIP) of the band Rush, and loves the song Tom Sawyer—the name of his family’s boat, a Grady-White Canyon 306. He grew up in Mattapoisett, MA, an idyllic small town on the water near Cape Cod. He spends time in Newport, RI and Bartlett, NH—both as far away from Wall Street as one could mentally get. The Newport office is on a quiet, tree lined street not far from the harbor and the log cabin in Bartlett, NH, the “Live Free or Die” state, sits on the edge of the White Mountain National Forest. He enjoys spending time in Key West (RIP JB) and Paris. Please get in touch with E.J. at ejsmith@yoursurvivalguy.com To sign up for my free monthly Survive & Thrive letter, click here.

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