When it comes to saving, more Americans are starting early

How and how much people save in accounts on the Ascensus platform offers insights on their behavior in regard to tax-advantaged savings vehicles.

In its annual savings trends report Inside America’s Savings Plans, Ascensus finds that saving behavior is starting younger—with retirement savers ages 25–34 most likely to be on track to meet their retirement goals. In addition, saving for others is beginning earlier, with more than half of newly opened 529 accounts started when beneficiaries are age 5 or even younger.

Automatic features in retirement plans are helping more workers save more, too, with participation rates up in plans that have auto enrollment features. In fact, participation rates hit 80%—10 points higher than participation in plans that don’t have auto enrollment.

Still, all is not as good as it could be. The report also finds that 401(k) account balances across all generations and income ranges are relatively low, compared with how much most experts suggest will be required to cover retirement goals.

And 529s aren’t in the clear, either, with the average 529 account balance for beneficiaries ages 16–17 only high enough to cover slightly more than half of a “two plus two” college education—consisting of two years at a community college, followed by another two at a public university.


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