- Fidelity counted a record 769,000 401(k) millionaire accounts in the second quarter.
- The number jumped 19 per cent from the first quarter.
- About 3 per cent of Fidelity's 25.8 million 401(k) account holders have reached the $1 million mark.
You might imagine that becoming a millionaire requires a huge salary, a successful business or an unusually lucky investment.
For hundreds of thousands of American workers, the path has been considerably less dramatic.
They have been putting money into their retirement accounts and leaving it there.
Fidelity Investments reported a record 769,000 401(k) accounts with balances of at least $1 million in the second quarter. That was up 19 per cent from the first quarter, marking the biggest quarterly increase in seven-figure 401(k) balances since late 2023.
About 3 per cent of Fidelity's 25.8 million 401(k) account holders have now crossed the millionaire mark.
The number is striking, but perhaps more interesting is what Fidelity says is behind it.
There is no secret millionaire salary hiding behind the numbers.
The millionaire strategy is surprisingly ordinary
Michael Shamrell, vice president of thought leadership at Fidelity Investments, told CBS News that the important part is not simply reaching $1 million, but understanding how people got there.
For many, the answer is years of consistent saving.
That means regularly contributing to a 401(k), staying invested and allowing investment returns to compound over time rather than constantly trying to guess the perfect moment to buy or sell.
Workers continued to demonstrate that behavior in the second quarter. The average employee contribution rate remained at a record 9.6 per cent.
The stock market also provided a major boost.
The S&P 500 rose roughly 15 per cent during the second quarter, its strongest quarterly performance since 2020, and was up about 20 per cent over the previous 12 months.
That rally lifted retirement account balances across Fidelity's workplace 401(k) and 403(b) plans, as well as individual retirement accounts.
Strong corporate earnings and enthusiasm surrounding artificial intelligence helped support stocks, while tax cuts and resilient investor confidence also contributed to the market's gains.
But the market rally alone does not explain how people accumulate seven-figure balances.
Someone who starts saving late or regularly pulls money out of investments can miss much of the benefit of compounding, even during strong market periods.
That is why the behavior of existing 401(k) millionaires may be more useful to ordinary workers than the millionaire label itself.
The number most workers should actually watch
There is also a big difference between the 769,000 millionaire accounts and the typical retirement account.
Fidelity reported an average 401(k) balance of $155,800 as of June 30. Average balances for 403(b) and IRA accounts were around $145,000.
That means the millionaire group represents a small fraction of the overall retirement-saving population.
And Fidelity is careful not to present $1 million as a magic retirement number.
Shamrell told CBS News that different people will need different amounts depending on their circumstances, while acknowledging that the million-dollar figure still carries enormous cultural appeal.
That distinction is increasingly important because Americans are living with higher costs and growing uncertainty about retirement.
A recent survey from financial services company NFP found that nearly 70 per cent of workers doubted they would be able to retire comfortably, while 72 per cent said they felt behind on their savings goals.
Separate research from the Employee Benefit Research Institute and Greenwald Research found retirement confidence at its lowest level since 2017, with debt, health care costs, inflation and concerns about Social Security weighing on workers.
Even the amount Americans believe they need for a comfortable retirement has risen.
Northwestern Mutual's 2026 Planning & Progress Study found that Americans estimated they would need an average of $1.46 million to retire comfortably.
So the record number of 401(k) millionaires should not be read as proof that retirement is becoming easy.
It offers a different lesson.
The millionaire next door may not have earned a millionaire paycheck. They may simply have started saving, kept contributing and given their money enough time to grow.
For workers still far from seven figures, that may be the most useful part of Fidelity's latest numbers: becoming wealthy through a retirement account can look remarkably ordinary while it is happening.
