Retirement account median balances increased by 24-thousand dollars from 2013 to 2016, with the median combined 401(k)/IRA balances rising from $111,000 in 2013 to $135,000 in 2016, a study from the Center for Retirement Research at Boston College found.
According to the research, while encouraging, $135,000 provides only 600 dollars per month in retirement, which means current saving levels fall short. To make matters worse, about half of households nearing retirement have no 401(k) assets at all. Researchers add 401(k)s and IRAs are increasingly playing a bigger role in the nation’s retirement system.
The study says there are two factors sparking the shift; Social Security will replace less earnings in the future than in the past and employer-sponsored plans have shifted from traditional defined benefit plans to 401(k)s and IRAs.