Some employers are cutting back their company match programs, but 401(k) accounts are still growing in Texas-over 27%. KTRH Money Man Pat Shinn is not surprised. ” ‘One‘ is the stock market went up last year. Not every 401(k) account is 100% in the stock market – but most typically most have some exposure to the stock market. So it’s no surprise that their account went up.”
Shin adds: ‘Two‘ is about the Covid lock-down. “In my own practice, my clients are spending a fraction what they were spending when they drove to work every day in ‘work clothes,’ going out to eat, to the movies and on vacation. Again, it’s no surprise that they are contributing more to their 401(k), which leads to their 401(k) going up.”
Another Covid-19 effect on our lives is the rise in the average balance of 401K accounts in Texas…which went from around 42 thousand in 2019 to over 54 thousand in 2020. Both base and contribution amounts increased. 401(k)s from employees in their 20s increased the most. With some companies foregoing their matching contributions – these are amazing numbers.
Pat Shinn gives you up-to-date market information 4 times a day on KTRH.