Who has the best 401(k)? Occupations with high income
People in occupations that provide a high income and those in financial services tend to have the best 401(k) plans, according to data published Thursday by Judy Diamond Associates.
That isn’t because CPAs, doctors, lawyers, dentists, and bankers have the plans with the lowest fees or highest-performing investments. Rather, the people in those professions have the income necessary to participate in the plan at high rates.
“The ingredients for a successful retirement plan are really only about three things,” said the author of the report, Eric Ryles, vice president of customer solutions at Judy Diamond. Those factors are participating in the plan, putting as much money into an account as possible, and having the maximum amount of time for those assets to appreciate through compounding, he said.
Across all industries, the median 401(k) account balance in 2022 was $50,501, with annual employee and employer contributions of $4,613 and $1,781, respectively, according to the report. The data are based on 610,000 Form 5500 filings made with the Department of Labor for the 2022 plan year, representing about 68 million workers and $6.4 trillion in assets.
CPAs, whose plans had the highest overall ratings by Judy Diamond, had median account values of $113,193, with employee and employer contributions of $7,861 and $2,740. Physicians, in second place, had account balances of $107,135 and employee and employer contributions of $5,250 and $2,987.
Those figures contrast with the numbers for the accommodation and food service industry, which ranked last. That group had a median account balance of $17,521 and employee and employer contributions of $2,170 and $633. The median participation rate in plans was just over 58 percent, while in
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