Dramatic market shifts this year amid President Trump's fluctuating tariff policies and growing recession fears have taken a toll on retirement accounts, according to a first quarter investment analysis released Thursday.
Fidelity Investments, the largest provider of 401(k) plans in the U.S., found average 401(k) balances fell 3 percent, hitting $127,100, even as savings rates rose, and the average individual retirement account (IRA) balance fell 4 percent to $121,983.
Fidelity said the slumps were "primarily as a result of market swings."
"Although the first quarter of 2025 posed challenges for retirement savers, it’s encouraging to see people take a continuous savings approach which focuses on their long-term retirement goals," Fidelity head of workplace investing Sharon Brovelli said in a news release on the report's findings.
Total 401(k) savings rates hit a record high in the quarter, driven by increases in average employee contribution rates to 9.5 percent and employer contribution rates to 4.8 percent. Fidelity reported that the combined 14.3 percent rate is the closest it has ever come to hitting the firm's suggested 15 percent.
"This approach will help individuals weather any type of market turmoil and stay on track to reach their retirement goals," Brovelli said.
The analysis comes on the heels of news that the U.S. gross domestic product (GDP) shrank 0.3 percent during 2025's first quarter, as analysts have warned that the U.S. economy could enter a recession as it adjusts to Trump's ongoing trade war.
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