Millennials Are the 401(k) Contribution Champs: BofA

Forty-seven percent of millennials contributed 7% or more to their 401(k) retirement plans last year, making them the generation most likely to save at high rates. At the same time, baby boomers were most likely to save 3% or less — 43% of them did so.

This is one of the insights in Bank of America’s new quarterly report series, 401(k) Participant Pulse, introduced Wednesday. The reports will provide insights into plan participants’ confidence and sentiment toward retirement planning and their overall financial wellness, according to a statement from the bank.

The inaugural report draws on data from BofA’s proprietary financial benefits programs, which include about 3 million 401(k) plan participants.

“We are deeply committed to understanding how current financial realities are affecting consumers’ long-term financial health and planning,” Lorna Sabbia, head of retirement and personal wealth solutions at BofA, said in the statement. “Long-term retirement planning is a critical metric when considering an individual’s financial wellbeing, as well as the economy as a whole.”

Other Report Findings

The average 401(k) plan participant contribution rate dropped from 6.6% at the end of 2021 to 6.4% at the end of 2022, which suggests consumers may have been somewhat more focused on short-term financial needs last year, the report said.