Nearly 200,000 401(k) accounts in the U.S. have accumulated at least $1 million in savings.

But the average 401(k) balance was up just 2% in the past year, to $106,000.

Alicia Munnell, head of Boston College's Center for Retirement Research, said most people haven't saved enough for retirement.



Fidelity Investments, the giant mutual fund company, announced on Wednesday that the number of 401(k) plans it administers with more than $1 million in savings rose 9% to 196,700 in the second quarter. The bad news? Those diligent savers represent a tiny sliver — just 1.1% — of Fidelity's more than 17.1 million 401(k) accounts.

What's more, the rate at which Fidelity 401(k) accounts reached the millionaire mark slowed dramatically between April and June, from 35% in the first quarter. The average account size rose even slower, at just 2%, to $106,000. Much of the reason has to do with the stock market, which also rose less rapidly in the second quarter. The bulk of 401(k) assets are invested in stocks.

Still, over the past year 401(k) returns have trailed the market as a whole. The S&P 500 was up 8% in the year ended June 30, compared with only a 2% increase in 401(k) balances over the same period.

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For the past few years, Fidelity has regularly touted the growth of 401(k) millionaire accounts, even at times painting the achievement as something that's a lot easier to achieve than it actually is. What's true is that average account sizes perhaps make America's potential retirement crisis look worse than it is. That's because many households have multiple retirement accounts, including IRAs and often more than one 401(k).

Also, as more young workers enroll in 401(k) plans, which is a good thing, that pulls down the average holdings. Fidelity says the average balance for a 401(k) plan that has been open at least 10 years is $305,900.

"While the number of 401(k) millionaires is still a small percentage of our overall 401(k) platform, it's great to see the number of people with $1 million or more in their account steadily increase," said Katie Taylor, a vice president of thought leadership at Fidelity. "Most of these millionaires are Baby Boomers, have been steady savers for many years, have contributed a healthy amount and have invested for growth in their account."

But that is far from the norm. And even Fidelity says the average worker should save 15% of their salary if they want to be prepared financially for retirement. That's a tall order for someone making less than $100,000 a year, let alone $50,000.

Alicia Munnell, who heads Boston College's Center for Retirement Research, said the latest data suggest most people haven't saved enough for retirement. "I"m concerned a lot of people will not be able to afford their standard of living in retirement," she said. "Trouble is ahead."