Workers upped 401(k) contributions in ’08

Despite the financial crisis and plummeting markets, employees are still contributing to their 401(k) plans, an analysis from Boston-based Fidelity Investments released today showed.
JAN 28, 2009
By  Bloomberg
Despite the financial crisis and plummeting markets, employees are still contributing to their 401(k) plans, an analysis from Boston-based Fidelity Investments released today showed. Fidelity analyzed its 17,095 corporate 401(k) plans, which represent more than 11 million participants. The firm found that 2008 participants contributed an average of $5,600 in pre-tax earnings to their 401(k) accounts — slightly higher from the 2007 average of $5,500. Almost all workers (96%) continued to contribute to their plans, even in the difficult fourth quarter of 2008. The firm stated that this percentage is in line with normal fourth-quarter activity, which typically experiences a slight dip in because participants have reached the Internal Revenue System limit for the year. “Despite a complex set of financial issues that led to a severe economic and market downturn, workers in 2008 remained committed to saving for retirement through their 401(k) accounts, and engaged with us more in trying to better understand their risk tolerance and an appropriate asset allocation and diversification strategy,” Scott B. David, president of Workplace Investing for Fidelity Investments, said in a statement. The percentage of active participants who took a 401(k) loan was also lower than 2007: In 2008, 9% of employees in a plan initiated a loan, compared with 9.7% in 2007. However, 1.6% of participants took hardship withdrawals in 2008, compared with 1.6% in 2007.

Latest News

Slow is smooth, smooth is fast
Slow is smooth, smooth is fast

Chasing productivity is one thing, but when you're cutting corners, missing details, and making mistakes, it's time to take a step back.

Edward Jones layoffs about to hit employees, home office staff
Edward Jones layoffs about to hit employees, home office staff

It is not clear how many employees will be affected, but none of the private partnership’s 20,000 financial advisors will see their jobs at risk.

CFP Board hails record July exam turnout with 3,214 test-takers
CFP Board hails record July exam turnout with 3,214 test-takers

The historic summer sitting saw a roughly two-thirds pass rate, with most CFP hopefuls falling in the under-40 age group.

Founder of water vending machine company, portfolio manager, charged in $275M Ponzi scheme
Founder of water vending machine company, portfolio manager, charged in $275M Ponzi scheme

"The greed and deception of this Ponzi scheme has resulted in the same way they have throughout history," said Daniel Brubaker, U.S. Postal Inspection Service inspector in charge.

Advisor moves: Raymond James, Wells Fargo reel in billion dollar-plus advisor teams
Advisor moves: Raymond James, Wells Fargo reel in billion dollar-plus advisor teams

Elsewhere, an advisor formerly with a Commonwealth affiliate firm is launching her own independent practice with an Osaic OSJ.

SPONSORED Delivering family office services critical to advisor success

Stan Gregor, Chairman & CEO of Summit Financial Holdings, explores how RIAs can meet growing demand for family office-style services among mass affluent clients through tax-first planning, technology, and collaboration—positioning firms for long-term success

SPONSORED Passing on more than wealth: why purpose should be part of every estate plan

Chris Vizzi, Co-Founder & Partner of South Coast Investment Advisors, LLC, shares how 2025 estate tax changes—$13.99M per person—offer more than tax savings. Learn how to pass on purpose, values, and vision to unite generations and give wealth lasting meaning