401(k) Savings Rate: Amid a rocky start to 2025 for the stock market, retirement savers in the U.S. proved their resilience. According to Fidelity Investments’ latest report, the average 401(k) savings rate reached an all-time high of 14.3% in Q1, signaling strong long-term confidence despite market turbulence and global economic uncertainty.
Fidelity, which oversees over 50 million retirement accounts, noted that while average 401(k) balances dipped 3% to $127,100, contributions remained robust. IRA balances dropped 4% to $121,983, and 403(b) plans declined 2% to $115,424, largely due to sharp market swings caused by trade tensions and unpredictable tariff policies.
Yet, savers didn’t flinch.
“Although Q1 posed real challenges, it’s encouraging to see Americans stay the course with retirement contributions,” said Sharon Brovelli, President of Workplace Investing at Fidelity. “This long-term mindset helps people withstand short-term volatility and stick to their retirement goals.”
Americans Are Saving More Than Ever
Fidelity’s data shows that employee 401(k) deferrals reached 9.5%, with companies contributing an additional 4.8% on average—bringing total contributions just shy of the firm’s recommended 15% benchmark.
Notably, this is the closest savers have come to Fidelity’s ideal savings rate, a positive trend aided by features like automatic contribution increases tied to salary hikes.
Among 403(b) account holders, the average savings rate hit 11.8%, while IRA contributions grew 4.5% year-over-year—a strong sign that despite market jitters, Americans are preparing seriously for retirement.
Market Swings? Stay the Course, Say Experts
The backdrop to this trend wasn’t easy. Trade policy shifts from Washington, D.C., and renewed tariff threats roiled financial markets in early 2025, with the S&P 500 suffering some of its worst trading days since the pandemic.
Yet financial experts urge savers to zoom out.
“The most powerful returns often come right after the worst drops,” said Gil Baumgarten, CEO of Segment Wealth Management. “Trying to time the market is rarely effective. Consistency is key.”
This is echoed by Mike Shamrell, Vice President at Fidelity, who added that even those nearing retirement should maintain a long-term perspective—typically a 10 to 20-year horizon—when investing in tax-advantaged retirement accounts.
Don’t Miss Out on Employer Contributions
Experts agree: If hitting 15% isn’t feasible yet, at minimum, contribute enough to unlock your employer’s full match—often referred to as “free money.” Nearly half of employers on Fidelity’s platform offer a match formula like 100% on the first 3% contributed and 50% on the next 2%.
“Auto-escalation tools, smart contribution strategies, and company matches are all powerful levers,” said Shamrell. “They can help workers of all ages get closer to retirement security.”