Per CNBC
Americans' average individual retirement account savings have dropped significantly in the fourth quarter of 2022. After a 20% drop year-over-year, Americans have just $104,000 in their retirement savings accounts.
Fidelity's president of workspace investing, Kevin Barry, gave a statement regarding how Americans were affected by different factors worldwide. It was noted that the average saver reportedly deals with challenging economic times.
Barry: “Given all the stresses in the world today, such as natural disasters and geo-political events, Americans continue to confront challenging times in our economy,”
401(k) accounts were reportedly also down by a whopping 23% in the fourth quarter of 2022. This meant that the average 401(k) balance had dropped to just $103,900, per Fidelity.
Although Fidelity noted that they recommended people save 15% of their income, most 401(k) contributions were only able to set aside 13.7% of their income. This included employer and employee contributions.
Fidelity said that 16.7% of the survey's participants had outstanding 401(k) loans at the end of 2022. The company noted that workers could borrow either $50,000 or up to 50% of the balances in their account, depending on which had a smaller amount.
Vanguard analysis revealed that there was a 20% drop in average 401(k) balances, seeing the average savings balance at just $112,572. Bankrate senior economic analyst Mark Hamrick gave a statement regarding how different economic factors affected savings.
Hamrick: “It’s clear that the less-than-optimal economy, including historically high inflation coupled with rising interest rates, has taken a double-edged toll on Americans,”
Aside from savings, home purchase mortgage applications dropped to a 28-year-low while the average 30-year fixed mortgage increased by 7 to 7.1%. Monthly payments for a 30-fixed loan on a $400,000 property's 20% down would be $230 more monthly than just a month ago.
See flow at unusualwhales.com/flow.
Other News:
- Mortgage applications for home purchases fall to a 28-year low
- The average rate on the 30-year fixed mortgage jumped back over 7%, rising to 7.1%
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