Business Operations

Americans are socking away a record amount in their retirement accounts (The Wall Street Journal, subscription).

The details: “The average savings rate in 401(k) plans rose to a record high 14.3% of income in the first three months of this year, according to a Fidelity Investments analysis of the millions of accounts it manages.”

• That’s almost as much as the 15% annual savings rate that financial advisors recommend.

Upward trend: Average savings rates have increased from 13.5% in 2020.

• Meanwhile, older savers are putting in more than younger ones: “At Fidelity, baby boomers saved 17.2% on average, while generation X and millennials put away 15.4% and 13.5%, respectively.”

More 401(k)s: “About 70% of the private-sector workforce now has access” to a 401(k)—and many more companies are using automatic enrollment to increase participation.

Still at risk: However, “About 40% of U.S. households are now at risk of being unable to maintain their standard of living in retirement, according to Boston College’s Center for Retirement Research.”

The NAM’s contribution: The NAM is helping more manufacturing workers gain access to 401(k)s through its Manufacturers Retirement & 401(k) Savings Plan, which allows many companies to participate in one 401(k) plan.

• Retirement benefits are a huge draw for prospective workers, and the NAM 401(k) plan makes it much easier for small and medium-sized manufacturers to offer them.
• Read our interview with one manufacturing leader who saw a huge benefit from moving to the NAM 401(k) plan—and find out what she learned in the process.