More 401(k) participants increased their contribution rate in the fourth quarter, led by millennials, in 2024, according to new data from Bank of America. The average contribution rate was 6.6%, up from 6.5% at mid-year. While 3-in-4 participants kept their contribution rate consistent, 21% of participants increased their rate in Q4 (up from 9.7% in Q3), led by millennials.
“Although the quarter closed with a lower average account balance compared to Q3, it was up 16% year-over-year,” said Lisa Margeson, Managing Director of Workplace Benefits Retirement Research at Bank of America. “These results can be due to a range of factors, both individual and macroeconomic. In Q4 2024, more participants increased their 401(k) contribution rate compared to previous quarters … Additionally, positive market forces likely helped grow participant balances across the board.”
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