The Investment Company Institute, a mutual fund industry group, recently delved into their vast database to focus on those who participated in their company 401(k) plans for the five years ended in 2004 (about 4 million people). Although the period included a nasty bear market, the average account balance rose by 36% from $67,016 to $91,042. The gains came from contributions and investment returns.
The findings should assuage concerns that Americans aren't preparing for retirement. 401(k) owners never fled stocks or abandoned their long-term goals. At the end of 2004, 67% of the average portfolio was invested in equities (46% in stock funds, 15% in company shares and the equity portion of the 10% in balanced funds).
[ via Christopher Farrell, BusinessWeek, Oct. 17, 2005 ]