Fidelity Q4 2018 Retirement Analysis: Market Shake-up Impacts Account Balances, but Investors “Stayed the Course” Despite Volatility

In the first paragraph, first sentence, "$6.9 trillion" has been changed
to "$6.7 trillion."

The corrected release reads: 

FIDELITY Q4 2018 RETIREMENT ANALYSIS: MARKET SHAKE-UP IMPACTS ACCOUNT
BALANCES, BUT INVESTORS “STAYED THE COURSE” DESPITE VOLATILITY

Fidelity
Investments^®, a broadly diversified financial
services company with more than $6.7 trillion in client assets, today
released its quarterly analysis of retirement savings trends, including
account balances, contributions and savings behavior, across more than
30 million retirement accounts. While market volatility in the fourth
quarter had a negative impact on account balances, the majority of
investors continued to stay focused on long-term retirement savings
goals and maintained a consistent approach to saving and asset
allocation.

“For many retirement savers, the recent market volatility is the most
significant they have seen in several years – and for some of our
younger investors, 2018 was the first time in their careers they have
experienced a significant down market,” said Kevin Barry, president of
workplace investing at Fidelity Investments. “Market corrections like we
experienced in Q4 can make investors anxious – however, the good news is
that we didn’t see that type of behavior amongst our 30 million
retirement savers. Similar to 2008, they stayed the course by
maintaining their asset allocation and continuing to add to their
accounts, a good discipline that can be beneficial when markets rebound,
as we’ve seen in the early part of this year.”

Highlights from this quarter’s analysis include:

• Average 401(k),
  403(b) and IRA account balances were down from record highs
  in Q3 2018. The average 401(k) balance dropped to $95,600, a 10
  percent drop from the record high balance of $106,500 in Q3 2018. The
  year-over-year average balance is down just over 8 percent from
  $104,300 in Q4 2017. The average IRA balance decreased to $98,400,
  about an 11 percent drop from last quarter and roughly 7.5 percent
  drop from $106,300 one year ago. The average tax exempt/403(b) account
  balance dropped to $78,700, a 10 percent drop from the Q3 and down 7.5
  percent from Q4 2017.

• Investors continued to contribute to their retirement savings
  accounts. More than 98 percent of 401(k) savers continued to
  regularly contribute to their 401(k) in 2018. For just the fourth
  quarter, the percentage increased to more than 99 percent, which is
  the highest quarterly percentage since Q1 2011. In terms of actual
  dollars contributed to retirement accounts, the average 401(k)
  contribution in 2018 was $6,850, which ties a record high, and the
  average total IRA contribution in 2018 was $4,200, a 10 percent
  increase over the average total contribution for 2017.
• Despite market swings, investors did not make significant changes
  to their 401(k) investments. Only 5.6 percent of 401(k) investors
  made a change to their asset allocation in Q4, including investors who
  have their savings in a target date fund or managed account. Of those
  investors who made a change to their 401(k) asset allocation, over
  two-thirds (67.4 percent) only made one change last quarter. And as of
  Q4, more than half (50.6 percent) of 401(k) savers are 100% invested
  in a target date fund.
• Fewer workers tapping their savings as 401(k) loan level dropped to
  10-year low. The percentage of workers with an outstanding loan
  from their 401(k) dropped to 20.3 percent, the lowest level since Q2
  2009. In addition, the percentage of workers initiating a new 401(k)
  loan dropped to 9.4 percent in 2018, the lowest 12-month percentage
  since Q2 2009.
• The number of 401(k) and IRA millionaires declined. The number
  of people with $1 million or more in their 401(k) dropped to 133,800
  at the end of Q4, while the number of IRA millionaires decreased to
  138,800.

For more information on Fidelity’s Q4 analysis, please click here
to access Fidelity’s “Building Futures” overview, which provides
additional details and insight on retirement trends and data.

About Fidelity Investments
Fidelity’s
mission is to inspire better futures and deliver better outcomes for the
customers and businesses we serve. With assets under administration of
$6.7 trillion, including managed assets of $2.4 trillion as of December
31, 2018, we focus on meeting the unique needs of a diverse set of
customers: helping more than 28 million people invest their own life
savings, 23,000 businesses manage employee benefit programs, as well as
providing more than 13,000 financial advisory firms with investment and
technology solutions to invest their own clients’ money. Privately held
for more than 70 years, Fidelity employs more than 40,000 associates who
are focused on the long-term success of our customers. For more
information about Fidelity Investments, visit https://www.fidelity.com/about.

Keep in mind that investing involves risk. The value of your investment
will fluctuate over time, and you may gain or lose money.

Target Date Funds are an asset mix of stocks, bonds and other
investments that automatically becomes more conservative as the fund
approaches its target retirement date and beyond. Principal invested is
not guaranteed.

Fidelity Brokerage Services LLC, Member NYSE, SIPC
900 Salem
Street, Smithfield, RI 02917

Fidelity Investments Institutional Services Company, Inc.,
500
Salem Street, Smithfield, RI 02917

National Financial Services LLC, Member NYSE, SIPC,
200 Seaport
Boulevard, Boston, MA 02110

874113.1.0

© 2019 FMR LLC. All rights reserved.

¹Analysis based on 22,600 corporate defined contribution
plans and 16.2 million participants as of December 31, 2018. These
figures include the advisor-sold market, but exclude the tax-exempt
market. Excluded from the behavioral statistics are non-qualified
defined contribution plans and plans for Fidelity’s own employees.
²
Fidelity IRA analysis based on 9.2 million Personal Investing IRA
accounts, as of December 31, 2018 and include Traditional IRAs, Roth
IRAs, and Rollover IRAs only. It excludes inherited IRAs and small
business IRAs, as well as the advisor-sold market.
³ Analysis
based on 10,600 defined contribution plans, including 403(b), 401(a),
401(k) and 457(b) qualified plans, and 5.9 million participant accounts,
for 4.4 million unique individuals, in the tax-exempt market, as of
December 31, 2018.

View source version on businesswire.com: https://www.businesswire.com/news/home/20190131005092/en/