Fidelity Investments, the nation’s largest provider of workplace retirement savings plans, reported Wednesday, May 19, that its average account balance rose 41% to $66,900 by the end of first quarter of 2010. Personal rates of return were a positive 42%.
From the bottom of the equity markets on March 9, 2009, when the S&P 500 hit a 12-year low, average account balances surged more than 55% to $71,600 exactly a year later on March 9, 2010, illustrating how quickly market gains can happen after a period of volatility.
“Over the long run, the tried and true strategies work best when it comes to saving for retirement,” said James M. MacDonald, president, Workplace Investing, Fidelity Investments, in a prepared statement. “Even through all of the volatility of the past couple of years, participants who continued to save in their 401(k) accounts now have a positive return from the start of the downturn in 2008.”
While the vast majority of active participants stayed the course throughout the past 18 months, a small percentage either stopped contributing to their workplace retirement accounts or decreased their equity exposure to zero.