Fidelity: Average 401(k) Balance Rebounds

The average 401(k) account balance rose to $60,700 as of September 30, up nearly 13 percent from the end of the second quarter, according to a new analysis of Fidelity-administered 401(k) plans. The gains reflect the recent stock market rally, new employee contributions, and enhanced employer 401(k) matches.

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Today’s typical account balance is well above that average of $50,200 retirement savers had in 2008, but still below the $69,200 nest egg Fidelity 401(k) participants had in 2007. If you exclude new 401(k) contributions, withdrawals, and loans from the calculation, the average account balance has grown 0.4 percent since September 2008, the analysis of 17,000 retirement accounts with 11 million participants found. This is the first positive rate of return in seven quarters.

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Part of the uptick in account balances is due to employers bringing back a 401(k) match that was reduced or suspended earlier in 2009, Fidelity says. Some 8 percent of Fidelity’s 401(k) plans slimmed their contributions to retirement accounts this year. However, just over a quarter of these companies (27 percent) have already resumed the match or plan to reinstate it in 2010. Large employers with 5,000 or more 401(k) participants were especially likely to restart the match.