- Trump pointed out the strong performance of the stock market, saying it has led to Americans' savings accounts going "through the roof."
- At companies that offer 401(k) plans, less than half of employees participate.
- The median account balance is less than $25,000.
President Donald Trump touted the strong performance of 401(k) accounts during his first State of the Union address.
The reality is that most Americans do not have one.
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"The great news for Americans — 401(k) retirement pension and college savings accounts have gone through the roof," Trump said, veering slightly from his prepared speech, in his 80-minute address Tuesday night.
Only about one-third of workers participate in a 401(k) plan, according to 2017 research from the U.S. Census Bureau. In fact, just 14 percent of all employers have a 401(k) or other defined contribution plan for their workers. Even at companies where they are offered, only 41 percent of employees contribute.
Among small business, it's less likely that a 401(k) is even available. On average, 10 percent of companies with fewer than 100 employees offer a retirement plan, according to new research from retirement savings platform Finhabits.
How many employers offer defined contribution plans
|# of employees||Percent that offer a plan|
|2 to 9||7.3%|
|10 to 24||20.2%|
|25 to 49||32.6%|
|50 to 99||46.5%|
|100 to 499||68.5%|
|500 to 1,000||83.5%|
|1,000 to 10,000||88.4%|
|10,000 or more||92.9%|
Source: Source: U.S. Census Bureau
Among employees who do sock away pretax dollars in 401(k) accounts, the average balance was $96,495 in 2016, according to Vanguard research. The median balance — half are above, half fall below — was $24,713.
The stock index surged more than 19 percent in 2017 and is up more than 5 percent this year.