Fidelity Investments says that during the first half of 2008, American workers are continuing to contribute to their workplace-savings plans despite current market volatility. Plus, the average contribution increased slightly compared with the same period last year: to $3,187 vs. $3,142 in the first half of 2007. Employees who contributed to the same savings plan in both periods actually gave $3,512 to the plans on average in the first half of 2008 compared to $3,283 in the first half of 2007, a jump of 7 percent.
Nonetheless, these figures fall far short of the $7,750 pre-tax maximum that can be targeted for contributions in the first six months of 2008, with $15,500 being the yearly pre-tax limit for those under 50 years of age. As of late 2007, less than 10 percent of all workers contributing to workplace-savings plans reached the annual maximum of $15,500.
Fidelity’s research is based on the analysis of its 16,723 corporate defined-contribution-plan clients, which include 11.5 million participants.
The average account balance is down nearly 9 percent to $64,000 as of June 30, 2008, from $69,200 at the end of June 2007, because of market impacts, Fidelity says. For employees who stayed in their plans for both years, this figure declined less than 1 percent to $71,500; during this same time period, the S&P 500 fell nearly 15 percent.