Fidelity said Thursday, May 28, that the average 401(k) balance fell 4% from the end of 2025 through the end of March 2026, even as the number of retirement savers who crossed the millionaire mark remained near record levels. The company reported 645,000 401(k)-created millionaires in the first quarter of 2026 and 571,622 IRA-created millionaires.
The 401(k)-created millionaire tally was down 3% from the fourth quarter of 2025 but up 26% from the first quarter of 2025. IRA-created millionaires fell 2% from the prior quarter, yet were up 32% from a year earlier. Fidelity said the average 401(k)-created millionaire is almost 59 years old and has been investing in the same account for an average of 25 years, a reminder that these balances usually build over decades rather than short bursts of market gains.
The firmer headline number sat alongside a weaker snapshot for workers leaning on their plans. In the first quarter of 2026, 19.2% of participants had outstanding 401(k) loans, up from 17.8% in the first quarter of 2024. Another 2.4% initiated a new loan in the period, compared with 2.3% a year earlier. The average new loan was $8,420, while the outstanding balance for participants who have taken at least one loan was $10,550.
Kirsten Hunter Peterson said many employees do not have enough emergency savings to cover unexpected costs, so they turn to retirement plans and take a loan they can repay. That pattern helps explain why the numbers remain sticky even when markets recover and balances grow over time.
The pressure point is what happens when the loan meets a job change. A 401(k) loan must be paid back if a worker loses a job or moves to another company, and the payback window can be as short as 30 days to 90 days. If the loan is not repaid, the borrower can owe taxes and a 10% penalty on the remaining balance if under age 59½. The IRS also says buying a boat or a TV does not qualify as an immediate and heavy financial need for a hardship withdrawal, narrowing the range of purchases that can be justified from retirement savings.
The quarter unfolded against a market that swung sharply early in 2026, with the Dow closing above 50,000 for the first time on Feb. 6 before falling nearly 11% by late March. Even with that volatility, the long-running math behind the millionaire figures did not change: Fidelity says the people who reach those levels generally do so by contributing regularly to the same account with the same employer for many years. That makes the latest report less a sudden market verdict than a look at how resilient retirement savings can be when the contributions keep coming — and how quickly they can be tested when cash gets tight.
