The retirement assets of older Americans surged to a new high of $3.5 trillion last year and, better yet for seniors, those between the ages of 65 and 74 saw the largest increase in wealth of any age group, according to a study by Hearts & Wallets.
The "2014 Portrait of U.S. Household Wealth: Market Sizing, Segmentation and Product Ownership" reported that the retirement income market – households "ages 65 and older that take income at 4 percent or more and are interested in 'retirement income solutions'" – reached $4.7 trillion last year, or 11 percent of all U.S. household assets. This market is predicted to grow to 20 percent in 2020.
The study found that retirement savings jumped to some 33.7 percent of all assets at $13.9 trillion. The retirement assets of seniors between 65 and 74 jumped from $2.3 trillion to $3.5 trillion, which is a new high.
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There was a "really big jump in assets of people who are 65 to 74," Laura Varas, who is a partner and co-founder of Hearts & Wallets, said. "They made a lot of money in stocks … and the market was so good last year."
Between the end of 2012 and the end of 2013, overall retirement assets jumped by nearly 17 percent from $11.9 trillion to $13.9 trillion, the study said.
IRAs were found to be the quickest growing and largest retirement asset. They represented 46.8 percent of all retirement savings at the end of 2013 at $6.5 trillion. Assets in IRAs increased over 20 percent, compared to $5.4 trillion in 2012. Private defined contribution plans saw 20 percent growth, reaching $4.9 trillion.
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