Fidelity data released on Tuesday showed a 20% increase in 401(k) accounts with over $1 million in the fourth quarter of 2023|Marco Verch|CC BY 2.0

In 2023, more people became “401(k) millionaires,” but the overall number is still low, reports Fidelity Investment, one of the largest providers of workplace retirement plans that cover 23 million participants.

In the fourth quarter, the number of 401(k) accounts with at least a million dollars in balances rose by 20% to 422,000 accounts. The average balance for these accounts was $1,551,300.

The term “401(k)” refers to a type of retirement savings plan offered by US employers, and “401(k) millionaires” are individuals who have accumulated $1 million or more in their retirement savings accounts.

Fidelity data released on Tuesday showed that because stocks and bonds did well and people saved regularly, their accounts got bigger last year.

By the end of 2023, the average 401(k) balance was $118,600, up 14% from the year before.