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Retirement Planning > Retirement Investing

Report shows confidence in U.S. retirement system

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Average retirement account assets per U.S. household increased by more than 10 percent during the last eight years, according to a new report.

Commissioned by the American Council of Life Insurers, the American Benefits Council and the Investment Company Institute, the report, “Our Strong Retirement System: An American Success Story,” explores how the retirement system contributes to Americans’ retirement security and concludes that the financial resources for retirement have improved since the 1990s.

The report reveals that average retirement assets per U.S. household, as measured in constant 2012 dollars, reached $167,800 in June 2013, up from $150,300 in 2005, an 11.6 percent rise. The 2013 total is also up markedly from the amounts reported in 1995 ($105,400), 1985 ($56,200) and 1975 ($27,300).

“A number of broad measures of retirees’ well-being indicate that the U.S. retirement system has successfully provided for American workers during retirement, and that successive generations of retirees have been better off than previous generations,” the report states. “These measures include rising levels of assets earmarked for retirement; measures of retirees’ wealth income and consumption; and studies of workers’ savings for retirement.”

Americans’ improving retirement resources is also reflected in the average combined balances of investors. A February 2013 Fidelity Investments analysis of 999,000 individuals who had both an individual retirement account and a 401(k) or 403(b) as of year-end 2012 pegs the average combined balances for all workers at $225,600 at year-end 2012.

The report shows the combined balances of the two retirement accounts by age group as follows:

  • $447,751 (ages 70-75)
  • $397,358 (ages 65-69)
  • $357,196 (ages 60-64)
  • $328,527 (ages 55-59)
  • $259,637 (ages 50-54)
  • $194,592 (ages 45-49)
  • $144,975 (ages 40-44)
  • $103,124 (ages 35-39)
  • $60,663 (ages 30-34)
  • $32,317 (ages 25-29)

The report also flags Americans’ confidence in employer-sponsored 401(k)s and other defined contribution plans. As evidence of this, the research points to a 2012/2013 Investment Company Institute survey, which found that more than six in 10 (63 percent) of all households had a “very” or “somewhat” favorable view of 401(k)s and similar retirement accounts.

Among DC- or IRA-owning households, the proportion of respondents with a favorable impression was 76 percent.


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