The average amount saved in a 401(k) account rose 17% in 2006, the fourth straight year of growth, according to a report from the Employee Benefit Research Institute and the Investment Company Institute analyzing the holdings of 20 million 401(k) participants.

Those who have been invested in a 401(k) since at least 1999 had an average balance of $121,202. In terms of average balance by age, for those in their 60s, it was $157,727; in their 50s,, $148,927; in their 40s, $108,262; in their 30s, $61,368; and in their 20s, $28,248.

The organizations also found that the amount of assets in 401(k) portfolios invested in company stock fell by two percentage points to 11%, down from 19% in 1999. Among recent hires in their 20s, about half put money in balanced funds, with 24% of their holdings in such funds, compared with 19% of their holdings in balanced funds in 2005 and a mere 7% of holdings in such funds in 1998.

One of the reasons investors may be doing a better job of diversifying their holdings, Sheena Iyengar, a professor of management at Columbia University Graduate School of Business told the Associated Press, is because more employers are automatically enrolling participants in target-date and balanced funds.

Nonetheless, many investors continued to take loans out against their 401(k), with 18% doing so last year, 19% in 2005 and 18% in 2000 and 1996. On the bright side, many of these loans were small, the average being 12% of assets.

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