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Subjects: Product/Service, Economic News/Analysis

Fidelity® Q3 2023 Retirement Analysis: Workers Commit to the Long-Term While Navigating Uncertain Markets and Short-Term Challenges

According to the latest data from Fidelity Investments®' Q3 2023 retirement analysis, account balances have decreased slightly since last quarter, while withdrawals and loans are inching up, showing the impact economic events such as inflation and market volatility can have on Americans? wallets?and ultimately their retirement savings. Encouragingly, retirement savings behaviors remain strong and many employers are coming together to find ways to tackle the problem of unexpected expenses, which can derail budgets, short-term financial goals, and even saving for retirement.

As one of the country's leading workplace benefits providers1 and America's No. 1 IRA provider2, Fidelity's quarterly analysis of savings behaviors and account balances for more than 45 million IRA, 401(k), and 403(b) retirement accounts shows many silver linings: retirement balances are up over a year ago, young investors are making great strides with the long-term, and savings rates remain steady and strong this quarter. But juggling the short-term has become a persistent problem, as Fidelity research shows 8-in-10 Americans say inflation and the cost-of-living are causing stress, with most U.S. adults (57%) unable to afford even a $1,000 emergency expense.

"Americans have become accustomed to riding the economic waves of the past several years, and this quarter is no different," said Kevin Barry, president of Workplace Investing at Fidelity Investments. "They are learning how to stay afloat in very challenging financial conditions - including having enough money set aside should an emergency arise. Through it all, we are pleased to see retirement savers continue to stay the course with steady savings rates and continued commitment to their futures."

Highlights from Fidelity's Q3 2023 analysis include:

Average Retirement Account Balances


Q3 2023

Q2 2023

Q3 2022

Q3 2018

Q3 2013



















"It's impressive to see Gen Z entering the workforce and prioritizing retirement savings," said Rita Assaf, head of Retirement Products. "While market conditions are constantly changing, the benefit of making consistent contributions over the long-run is clear?a more secure retirement."

Spotlight Series: Breaking Down Withdrawals vs. Loans

One potential cloud on the horizon: despite consistent contribution levels, many individuals increasingly have been tapping their retirement savings through in-service withdrawals, hardship withdrawals, or loans.

The increasing use of hardship withdrawals and loans underscore the need to help retirement savers develop emergency savings, which Fidelity has found to be the No. 1 savings goal among employees, after retirement. 7 To help ease this burden for employees, many leading employers are working with Fidelity to add workplace emergency savings programs to their growing roster of financial wellness benefits.

Managed Accounts Helping Many Retirement Savers Stay on Track

Employers continue to explore plan features to help improve the retirement planning efforts of their workforce, especially during periods of market volatility. One feature growing in popularity: workplace managed accounts, an option for retirement savers looking for personalized, professional help to keep their investment strategy aligned with their retirement goals. In fact, Fidelity's workplace managed account offering ? Personalized Planning & Advice ? has just reached a major milestone, celebrating 20 years helping individuals create a holistic retirement savings plan. Among the many reasons to celebrate this anniversary:

For additional information on Fidelity's Q3 2023 analysis, as well as a deeper dive into withdrawals versus 401(k) loans, click here to access Fidelity's "Building Financial Futures," which provides additional details and insight on retirement trends and data. In addition, Fidelity also offers a variety of other resources to learn more about retirement planning, including helpful Viewpoints articles such as "How to take control of your retirement" and a new site dedicated to engaging the next generation of investors.

About Fidelity Investments

Fidelity's mission is to strengthen the financial well-being of our customers and deliver better outcomes for the clients and businesses we serve. With assets under administration of $11.5 trillion, including discretionary assets of $4.4 trillion as of September 30, 2023, we focus on meeting the unique needs of a diverse set of customers. Privately held for 77 years, Fidelity employs more than 73,000 associates who are focused on the long-term success of our customers. For more information about Fidelity Investments, visit https://www.fidelity.com/about-fidelity/our-company.

Keep in mind that investing involves risk. The value of your investment will fluctuate over time, and you may gain or lose money.

Past performance is no guarantee of future results.

Views expressed are of the date indicated, based on the information available at that time, and may change based on market or other conditions. Fidelity does not assume any duty to update any of the information.

Fidelity® Personalized Planning & Advice at Work is a service of Fidelity Personal and Workplace Advisors LLC and Strategic Advisers LLC. Both are registered investment advisers, are Fidelity Investments companies and may be referred to as "Fidelity," "we," or "our" within. For more information, refer to the Terms and Conditions of the Program. When used herein, Fidelity Personalized Planning & Advice refers exclusively to Fidelity Personalized Planning & Advice at Work. This service provides advisory services for a fee.

Fidelity Brokerage Services LLC, Member NYSE, SIPC
900 Salem Street, Smithfield, RI 02917

Fidelity Distributors Company LLC,
500 Salem Street, Smithfield, RI 02917

National Financial Services LLC, Member NYSE, SIPC,
245 Summer Street, Boston, MA 02110

© 2023 FMR LLC. All rights reserved

1 Based on PLANSPONSOR Magazine's "2023 Recordkeeping Survey," June 2023 and "Plan Administration Guide, Part 1" which offers insight into the provider marketplace for defined benefit (DB), stock plan and health savings account (HSA) administration, May 2018.
2 Based on Cerulli Associates' Top-10 IRA Providers by AUA, 2Q 2020?2Q 2022.
3 Fidelity business analysis of 14.6 million IRA accounts as of September 30, 2023.
4 Fidelity Investments Q3 2023 401(k) data based on 25,300 corporate defined contribution plans and 22.9 million participants as of September 30, 2023. These figures include the advisor-sold market but exclude the tax-exempt market. Excluded from the behavioral statistics are non-qualified defined contribution plans and plans for Fidelity's own employees.
5 Fidelity Investments Q2 403(b) data based on 10,165 Tax-exempt plans and 8.3 million plan participants as of September 30, 2023. Considers average balance across all active plans for 6.16 million unique individuals employed in tax-exempt market.
6 Generations as defined by Pew Research: Gen Z (born 1997-2012), Millennials (1981-1996), Gen X (1965-1980) and Boomers (1946-1964).
7 Fidelity's Financial Wellness Checkup of 392,000 active workplace participants from January 1, 2023 to August 31, 2023.
8 Cohort data includes all participants who had been enrolled in Personalized Planning & Advice for 8+ years as of December 31, 2021. Assessment based on Fidelity's RPM (Retirement Preparedness Measurement) score, which represents the percentage of a participant's retirement expenses that are on track to be covered in poor market conditions. RPM considers an individual's contributions, portfolio asset mix, retirement time horizon, and expected retirement expenses.
9 Fidelity analysis as of September 30, 2023. Engagement is measured for both active and terminated enrolled participants in corporate DC and TEM plans with a positive balance over a period of the last 12 months.

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