State Chamber Update
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recent study by Fidelity Investments about retirement accounts disclosed several interesting data points: 401(k), 403(b) and IRA balances were, on average, down at the end of last year. That will come as no real surprise to those who follow markets closely. However, on the “good news” side of things, loans against 401(k) plans dropped to a ten-year low. In 2018, the average total 401(k) contribution was $6,580 while the average IRA contribution was just over $4,000. Fidelity surveyed more than 30 million accounts and found that the average IRA balance of $98,400 and was down 11 percent last year. The average 401(k) balance fell almost 10 percent in 2018 to $95,600.
Our state is a retirement destination, due in no small part to our favorable weather, attractive beaches, transportation options, low or no taxes, and more. I’ve written before about how we might consider attracting a greater share of young professionals to Delaware by assisting with student loan repayment, and maybe hurry the day or increase the amount these employees save for retirement. For me, the Fidelity Investments data is scary. Employees are woefully under-invested for retirement and therein lies an opportunity. If we get creative and attract younger workers by addressing their “pain point,” otherwise known as student loan debt, we might discover a recruitment tool, too.
News You Can Use
We are light on economic data this week but have plenty of speechmaking! Tuesday, the President delivers his State of the Union Address to Congress. On Wednesday and Thursday, we’ll hear from Federal Reserve members Jerome Powell, Randal Quarles, and Richard Clarida, as well as from St. Louis Federal Reserve President James Ballard.
