First Person: My 401(k) Balance Average Is Falling Behind

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According to a recent Reuters report on Yahoo! Finance, "The average 401(k) retirement balance for U.S. workers hit a record high of $80,900 in the first quarter, a growth spurt of 75 percent since the stock market's nadir in March 2009, Fidelity Investments said on Thursday based on a survey of its accounts."

I can only wish my 401(k) was hitting $80,000 or even close to it, but it's not. This doesn't mean though that I'm just throwing my hands up in the air and giving up. No, instead I'm trying to see the brighter side of life and look at the potential for my pitiful IRA that's not even half the national average.

Averages and statistics don't mean everything

As someone who still has at least 30 years -- and probably more like 40 years -- until retirement, the statistics when it comes to average 401(k) balances don't mean everything. There are still a lot of people out there counting on pensions, especially when it comes to retiring baby boomers. And there is a wide gambit run between the account balances of those just starting out in their early-20s and those who are nearing retirement. In fact, the Reuters report I mentioned noted that, "…pre-retirement workers have seen their average balance nearly double to $255,000 since the first quarter of 2009 when the average balance was $130,700."

Growing share total

But all is not doom and gloom, even for those of us who aren't anywhere close to that $80,000 average. While my retirement account balance isn't shooting through the roof, I have moved its balance into a dividend earning income fund. My DRIP (dividend reinvestment plan), doesn't fluctuate wildly with the stock market and provides share value stability while paying out monthly dividends that yield me about 6 percent a year. These funds are reinvested to purchase additional shares, building share total in addition to share value.

Non-stock-based investment vehicles

Of course stocks and the stock market are the most discussed and more commonly touted investment options for retirement, but there are other areas to consider. I don't like putting all my eggs in one basket when it comes to our retirement plan and factoring in items like home principal, bonds, savings, commodities, and other assets can somewhat make up for what might be lacking in a stock-based retirement plan.

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The author is not a licensed financial professional. The information provided in this article is for informational purposes only and does not constitute advice of any kind. Any action taken by the reader due to the information provided in this article is solely at the reader's discretion.


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