BofA Report Finds 401(k) Account Balances Increased by 15% in 2023, Health Savings Account Balances Increased by 11%
Percentage of Plan Participants Who Increased Their 401(k) Contribution Rate Doubled in Q4
CHARLOTTE, N.C., Feb. 7, 2024 /PRNewswire/ -- Today, Bank of America Retirement and Personal Wealth Solutions, in partnership with Bank of America Institute, released its fourth quarter 2023 Participant Pulse (MAP6212241), which found that average 401(k) account balances rose
The Pulse monitors the behavior of plan participants in Bank of America recordkeeping clients' employee benefits programs, which are comprised of more than 4 million participants as of December 31, 2023.
"We were encouraged to see more plan participants taking positive actions in their accounts in the fourth quarter," said Lorna Sabbia, Head of Retirement and Personal Wealth Solutions at Bank of America. "These insights offer signs that people are prioritizing their retirement savings, with more employees increasing their contribution rates and fewer taking hardship distributions."
The report found that fewer participants borrowed from their 401(k) plan (
Health Saving Account Trends
In addition to 401(k) trends, the Participant Pulse examines engagement across Health Saving Accounts (HSA) and overall feelings of financial wellness. Key findings include:
- Average HSA account balance increased by
11% YoY. Average account balances increased to in 2023, up from$4,380 at year-end 2022, with nearly 4-in-10 accountholders contributing more than they withdrew.3$3,930 - Millennials saved more of their HSAs. Overall,
76% of HSA contributions were spent on health care expenses, while24% were saved. Millennials4 saved34% of their contributions, more than any other generation.3 - More men than women invested their HSA contributions.
12% of account holders invested their HSA contributions for future growth, with men outpacing women (17% vs.11% ).3
Read the full report and methodology here to learn more.
1Comparisons to 2022 reference data derived from Bank of America Retirement and Benefit Plan Services 401(k) data platform as of 12/31/2022.
2Comparisons to 2023 Q3 reference data derived from Bank of America Retirement and Benefit Plan Services 401(k) data platform as of 9/30/2023.
3Reference data derived from Bank of America Retirement and Benefit Plan Services HSA data platform as of 12/31/2023.
4Generation defined by the following birth years: Baby Boomers 1946 – 1964; Gen X 1965 – 1980; Millennials 1981 – 2000, GenZ after 2000.
About Bank of America Institute
Bank of America Institute is dedicated to uncovering powerful insights that move business and society forward. Established in 2022, the Institute is a think tank that draws on data and analyses from across the bank and the world to provide timely and original perspectives on the economy, sustainability, and global transformation. The Institute leverages the depth and breadth of the bank's proprietary data, from 69 million consumer and small business clients, 57 million verified digital users,
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