401(k) Millionaires Plunge – Newsweek

The number of 401(k) millionaires in the U.S. has dropped amid stock market uncertainty in recent months.

Why It Matters

The implementation of President Donald Trump‘s wide-ranging tariff agenda sparked severe market jitters earlier this year, which sprung the worst two-day loss in U.S. stock market history. The administration has said tariffs will seek to correct global trade imbalances that have disadvantaged the U.S. and motivate companies to relocate their manufacturing operations to American soil.

401(k)s are invested in stocks and bonds, so their value rises or falls with market performance and economic conditions.

What To Know

The number of 401(k) millionaires dropped to 512,000 by the end of the first quarter—a 4.6-percent decline from the previous quarter, according to data released Wednesday by Fidelity Investments. The median account balance among these millionaires is $1.3 million.

Market volatility took a toll on retirement accounts across the board. The average 401(k) balance stood at $127,100—up 1 percent from a year earlier, but down 3 percent from the fourth quarter of 2024.

Among age groups, baby boomers had an average balance of $239,600, Generation X held $187,400, Millennials averaged $66,800, and Gen Z, the youngest working generation, trailed with $13,900.

U.S. Dollars — Stock image of a person holding several $100 bills.

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The 401(K) savings rate reached an all-time high of 14.3 percent, just below Fidelity’s recommended rate of 15 percent, with employees contributing an average of 9.5 percent, while employers added another 4.8 percent.

“Although the first quarter of 2025 posed challenges for retirement savers, it’s encouraging to see people take a continuous savings approach which focuses on their long-term retirement goals,” Sharon Brovelli, president of workplace investing at Fidelity, said. “This approach will help individuals weather any type of market turmoil and stay on track to reach their retirement goals.”

It comes after the number of 401(k) millionaires rose in 2024 by 27 percent on the previous year thanks to a bumper year for the stock market.

What Should I Do With My 401(K)?

In the midst of market uncertainty, experts advise not worrying unduly about your later life savings, but you could take a look at your portfolio and see if you can make any changes, particularly if you are approaching retirement.

“For those approaching retirement, this may be a smart time to reassess your asset allocation,” Pawan Jain, interim chair at the Department of Finance, Insurance and Real Estate at Virginia Commonwealth University, told Newsweek.

“Overexposure to sectors or international stocks vulnerable to trade disruptions can lead to unnecessary stress. On the other hand, younger investors with years to go before retirement are often best served by staying the course.”

“While tariff-related headlines may cause short-term market swings, the broader economic and investment landscape remains resilient and full of opportunity,” Michael Unger, vice president of investments and planning at Coral Gables Trust, told Newsweek. “Trade policies evolve, markets adapt, and investors who stay the course are often rewarded.”