‘Barron’s Roundtable’ discusses reports that Gen Z members are aggressive about their retirement desires.
Generation X has stepped up their efforts to build savings for retirement, according to recently released data from Fidelity Investments.
The financial services firm reported Thursday in its third-quarter retirement analysis that Gen Xers who put money into individual retirement accounts (IRAs) increased their total contributions by as much as 35% compared to the same period in 2023.
It considered Gen X as people born in the years 1965 through 1980.
Serious adult couple calculating bills payable, checking domestic finances, middle-aged family management, budget planning, expenses, gray-haired man and woman reading bank loan documents at home (Istock / iStock)
Compared to a year ago, more Gen Xers also deposited money into their IRA accounts in the third quarter, according to Fidelity. That jump was 23%.
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The financial services company said in a press release that Generation
When it came to Gen Fidelity.
“We are pleased to see Generation X retirement savers continue to make solid gains on their retirement savings,” Fidelity Wealth Chairman Roger Stiles said in a statement. “The oldest members of this generation will be retiring in the next five to 10 years, making this the perfect time to focus on securing savings that will help them live more comfortably during their retirement years.”
This is because Fidelity found that people saving for their golden years generally experienced “another quarter of growth thanks to continued strong contribution levels and positive market conditions.” The analysis included more than 49 million retirement accounts.
Two types of retirement plans — 401(k)s and 403(b)s — posted their “highest ever average” for balances in the third quarter, the financial services firm said.
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For 401(k) accounts, balances averaged $132,300 in the third quarter, a quarter-over-quarter increase of 4% and a year-over-year increase of 23%, according to Fidelity.
Some younger Americans are opting for “micro-pensions” earlier in their careers rather than saving fully for their permanent retirement later in life. (Getty Images / Getty Images)
Average balances in 403(b) plans posted similar increases, reaching $119,300.
Meanwhile, the average balance for IRAs for the quarter came in at $129,200.
Fidelity’s pension analysis showed that the overall average savings rate “remained stable” in the third quarter. It pegged it at 14.1%, just below the 15% the company recommends.
“Consistent retirement contributions across market cycles are important, but despite what’s happening in the marketplace, maintaining this commitment over the long term is what will help Americans achieve a future of financial well-being and security,” said Fidelity Investments, president of Workplace Investing. in a statement.
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Earlier this year, Northwestern Mutual said Americans think $1.46 million is the amount of money they need to retire “comfortably.”
Someone puts money in a pot for retirement savings. (iStock / iStock)
About 57% of working Americans said they thought they were taking a back seat when it came to saving money for retirement, according to a separate Bankrate survey released in late September. On the other hand, 15% said they were “significantly” or “somewhat in favor” of it.
Another 22% believed they were “on the right track,” according to Bankrate.
