Young adults under 35 who have retirement accounts with
On average, if they sustain their current savings rates, they are likely to cover 124 percent of their retirement needs. However, those 35 and over, are likely to fall short. If they sustain their current savings rates, those in the 35 to 50 age group are likely to be able to cover only 60 percent of their retirements needs while those over 50 are likely to have enough to cover only 27 percent of their needs.
This is one of the findings of a report released today by the Fidelity Institutional Retirement Services Company on the defined contribution industry. The report is the second produced by Fidelity and is based on data from 1999. That data is for 6.2 million Fidelity participants in about 7,000 plans, according to Fidelity.
'Young Adults have the greatest chance of succeeding because they are developing solid investing behaviors and have so much time ahead of them to accumulate perhaps more than what they may need,' said Kathryn Hopkins, executive vice president of Fidelity Institutional Retirement Services Company. 'The primary reason others may fall short is simply due to the fact that they have not been in plans long enough and may only have an additional 10 to 15 years to maximize savings'
Also, women are substantially lagging behind men in average retirement account balances at Fidelity. Women average $43,000 while men average $77,000, according to the report. The primary reasons for the disparity are that women move in and out of the workplace because of family responsibilities and are in lower paying jobs overall, according to the report.
The report also concluded that participants with larger balances maintained their accounts or rolled over to others much more consistently than those with small accounts. Only between two and four percent of participants with account balances of $50,000 or more cashed out of their plans in 1999, while 32 percent of those with $10,000 or less did so, according to the report.
