Retirement Savings Recipe: 401(k) + IRA

Better savings on the horizon for some

Intuitively, it makes sense that those individuals who are saving for retirement via both a 401(k) plan and an IRA may have more success than those saving in just a 401(k) or IRA alone. What is interesting is new data from Fidelity quantifying just how substantial the impact is of having both types of plans. As of 12-31-2012, the average balance in 401(k) plans serviced by Fidelity was $77,300. This represents over 20,000 plans with about 12 million participants . For the nearly one million participants who also maintain an IRA with Fidelity, the average account balance jumped to over $225,000. (Those participating in 403(b) programs also are included in the statistics.) For those age 65-69, the average account balance was just under $400,000, a very encouraging sign. Benefiting from the catch-up rules, savers in their 50's contributed an average of $13,100 annually. A Fidelity news release provides additional details. A note of caution, however - the flip side is that there are millions of participants for whom saving in both is difficult at best and virtually impossible at worst. 

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