Study: Most 401(k) Participants Have Made Money Since 2007
December 16, 2009 by Special To Personal Liberty
The Vanguard Group, a provider of company-sponsored retirement plans, has recently announced that the typical 401(k) participant currently has more money in their account than they had before the market declined in September 2007.
According to the study, approximately 60 percent of Vanguard participants who stayed invested have an account balance that is equal or higher than it was at the market’s peak in 2007. Roughly 40 percent of continuous participants have lower balances, although the majority of them are less than 20 percent below their peak value.
The Pennsylvania investment management company said that the meaningful improvement in retirement holdings is due to continued investing, balanced portfolio construction and a sharp increase in stock prices from their March 2009 lows.
"Our evidence suggests that ongoing contributions plus improvement over time in the capital markets may restore many more of these individuals to their pre-October 2007 wealth levels, perhaps more rapidly than previously anticipated," said retirement research head Steven Utkus.
Meanwhile, Fidelity Investments released a report last month that said that their average account had increased 28 percent between March and September of 2009, the Associated Press reports.