welcome back if you are saving for retirement things are looking a bit better for you today than they were a couple years ago last year was actually a big year for retirement savings accounts in part because of a strong Market the average 401k account jumped to $118,600 at the end of last year and that's our big number today that figure is according to a new report from Fidelity and it's a jump of 14% from the year before but a strong Market does not get all the credit Americans can Pat themselv
es on the back for proactively saving more Fidelity says 27% of people who increased their contribution last year did it on their own instead of relying on that auto increase right now the Boost helped those with the richest accounts get even richer Fidelity says the number of 401k millionaires that's people with a million dollars in their savings account increased by 20% from the third quarter of 2023 to the 4th we're taking you to the intersection for this one that's where Wall Street crosses
paths with Main Street and Joshua Dolby joins us there as a certified financial planner and the president of North Main Financial Group Joshua always great to have you on so what does this mean for just how much we should be contributing to our 401 case thanks Chris it's always good to be with you uh it it really is the same Mantra no matter what the market is doing and that's that's really uh very important point to keep in mind definitely the attention increases when we have a good year like w
e had last year as measured by our most popular stock indices but we want to be worried about chasing the hot ones and be more concerned about diversification and mindful of those things which maybe have have been off the radar screen and the stock market certainly plays a big role but what other factors impact how your retirement savings account is performing yeah definitely the decision making as far as how you're invested it can be very attractive uh to chase those things which have done well
and certainly there are parts of the market which have done and continue to perform exceptionally well but there are other parts of the market which haven't done as well and that's not a reason necessarily not to pay attention to them so it's important to be mindful of where you are in your investment Journey how close you are to retirement and perhaps how soon you'll need to draw on these funds to supplement your income let's say you're you're selfemployed or your employer doesn't offer a 401k
what other ways can you prepare for retirement you touched on a great Point Chris and with over 50% of our businesses being individual or small businesses in this country it's a huge question and and certainly one that needs to be answered there are lots of options and that's one of the blessings of of being in a small business or in business for yourself because there are so many options out there from which to choose you might might be able to establish your own 401K but there are other kinds
of retirement plans as well which not only can be helpful in the current year from a tax standpoint but also in terms of long-term accumulation and financial flexibility so definitely important to take a look at all the options that are available to you it's also important to note Joshua that more people borrowed from their 401K last year including for hardship reasons what should someone consider before they dip into their 401K early this is a big issue Chris and and you hit on it in in ways t
hat we really need to extend the conversation because yes you are borrowing against yourself yes you are paying yourself back but it also inhibits some of your long-term growth as well so folks need to be mindful of the interest rate that's being charged what's the cost of withdrawing those funds what's the payment plan to return those funds back to the plan and then thirdly what is the reason that you're withdrawing in the first place is it for something that is sustain like perhaps to make a d
own payment on a home or is it to help children get through college or is it for something which perhaps is not as sustaining maybe it's for a trip or maybe it's to be even to be able to pay bills especially because the cost of living has risen so much here over the last several years so a very important part of the planning process and very important to understand what those long-term impacts are yeah all very important pieces of information Joshua Dolby it is always great to have you thanks fo
r being with us thanks Chris
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