"When the 401(k) was introduced in 1978, it was meant to supplement traditional pensions - not replace them. Back then, more than half of American workers could count on a pension. But as pensions disappeared, the 401(k) quietly became the cornerstone of retirement savings. Today, over 70 million Americans rely on it, with about $7.4 trillion locked away in these accounts."
"Fidelity data shows that more than half a million Americans have reached "401(k) millionaire" status. Still, the system has its limits. A 401(k) alone wasn't designed to carry someone through decades of retirement - yet millions of people treat it as their only plan. Despite being financially savvy, his dad had saved only through a 401(k). Now, he's realizing that even a healthy balance may not stretch as far as expected."
When introduced in 1978, the 401(k) was meant to supplement traditional pensions, not replace them. More than half of American workers could count on a pension then, but pensions disappeared and the 401(k) became the cornerstone of retirement savings. Over 70 million Americans rely on 401(k) plans, with about $7.4 trillion in accounts. Fidelity data shows more than half a million Americans are 401(k) millionaires. A 401(k) alone was not designed to carry someone through decades of retirement, yet millions treat it as their only plan. A retiree who saved only through a 401(k) discovered its limits, prompting debate about dependence on a single savings vehicle and the value of financial planning and diversified investment vehicles.
Read at 24/7 Wall St.
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