Retirement Plans Soar in Strong Market, But Half of Americans Missing Out

Americans with 401(k)s have had reason to celebrate the last two years, as record stock market performance has inflated retirees’ nest eggs.

But despite all the sunny news, a huge swath of Americans is missing out, according to a Thursday post from the Center for Retirement Research at Boston College.

The CRR, which has written extensively about home equity’s place in retirement plans, notes that a full 48% of families in the United States do not own any equities, according to the Federal Reserve’s most recent Survey of Consumer Finances.

All this means that amid a 19% gain in the stock market in 2017 and a 6% rise so far in 2018 — and the president’s regular bragging about the state of the stock market and its effects on Americans’ 401(k) plans — just about half of citizens are missing out.

“The chasm between the well-heeled and the ordinary workers has been widening,” the CRR observes. “Stock ownership is one prism through which to view that inequality.”

The CRR also points out that among those whose incomes fall in the bottom half nationwide, only 30% own some type of equity, which includes 401(k)s, brokerage accounts, stocks, and mutual funds. Despite wage gains of 2.5% over the course of last year, hourly workers also saw inflation of 2.1%, which largely wiped out those improvements, according to the CRR.

“One in two Americans isn’t at the party,” the CRR concludes.

Article by reversemortgagedaily.com