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.
Action Line: When you need a plan, I’m here.
