Average Account Balances Up 13.5%,
Firm Identifies Potential Savings Pitfalls Associated with Each Life Stage

BOSTON, August 12, 2009 - Fidelity Investments, the nation's No. 1 provider of workplace retirement savings plans, today made available 401(k) highlights from the second quarter of 2009, as well as analysis of participant behavior at different life stages that is hindering many Americans' retirement savings.

Fidelity's data¹ , based on more than 17,500 corporate defined contribution plans and 11.2 million participants, showed that the portion of participants increasing their deferral rate in the second quarter was larger than the portion decreasing the rate. This reverses the trend of the prior three quarters when a greater percentage of participants lowered their deferral rates. The average account balance rose 13.5 percent in the second quarter from the end of the first quarter 2009 to $53,900, primarily driven by increases in the equity markets as well as participant and employer contributions. "More workers are increasing their savings levels in their 401(k) plans as Americans across the country recognize the need to save more," said Scott B. David, president, Workplace Investing, Fidelity Investments. "The downturn has really reinforced the importance of saving consistently and having a diversified portfolio."

Workers Grow More Conservative with Contributions and Fewer Stop Contributions

Fidelity reported that there has been a shift to more conservative investments over the past year, with a smaller portion of contributions going into equities than in previous years.

•		About 68 percent of 401(k) contribution dollars in the first half went to equities. That number has hovered around 75 percent for the past few years and topped out at over 80 percent in 2000.
•		More specifically, in the second quarter, 8 percent of contribution dollars went to company stock, 42 percent was invested in domestic and international equity options, 24 percent went to blended or lifecycle options, and 24 percent was allocated to conservative options such as short-term (i.e., money market), stable value, and fixed-income.
•		The percentage of active participants who decided to stop contributing during the second quarter was 1.3 percent, down from 2.2 percent in the past two quarters and in line with the longer-term historical trend of about 1 percent

Fidelity also analyzed the 401(k) data by age groups and identified key behaviors that are hindering savings for workers at different life stages.

Workers in their 20s: Lack of Participation Hinders Savings

While the portion of workers in their 20s who participate in a workplace savings plan such as a 401(k) or 403(b) has increased in recent years with the help of auto enrollment, the majority still do not participate. Less than half (44%) of eligible workers in their 20s contribute to their workplace plans today.

"A savings gap in the early years has a much more damaging impact on long term savings levels than a gap in the later years so it is critical that workers get started as early as they can," added David.

Accumulators (30s to 40s): Prevalence of Loans Risks Future Retirement

When workers reach their 30s and 40s, savings behavior improves, with participation rates of more than 65 percent and a higher average elective deferral rate of 7.7 percent of salary. However, the frequency and the prevalence of taking out a loan against workplace savings increases significantly as many begin a different life stage with competing financial priorities.

When workers reach their 30s and 40s, many are focused on buying their first home, saving for their children's education, and saving for retirement as well as managing debt. As a result, nearly one in four workers (23%) in this age group has one or more outstanding loans, and more than one in 10 (10.6%) initiated a loan over the past 12 months.

Workers in this age group also tend to be repeat loan users. Nearly one third (31 percent) of continuous active participants in this age group who took a loan last year also took one this year.

Pre-retirees (50+): Poor Asset Allocation Leaves Some Vulnerable

By the time participants reach their 50s, some of the pitfalls and behaviors evident among younger workers are much improved. Participation rates among this age group are higher with over 70 percent participating. They also contribute an average of 10 percent of their salary. However, poor asset allocation detracts from overall results.

Over a quarter (26%) of pre-retirees either have no exposure to equities or hold 100 percent equities in their 401(k) plan. More than one in 10 (11.4%) pre-retirees holds no equities in their 401(k) plan, a strategy that has historically resulted in significantly lower returns on an inflation-adjusted basis than those of more diversified portfolios. At the other end of the spectrum, 14.2 percent of pre-retirees are 100 percent invested in equities, an overly aggressive approach that leaves them much more vulnerable to a market downturn.

About Fidelity Investments

Fidelity Investments is one of the world's largest providers of financial services, with custodied assets of $2.8 trillion, including managed assets of over $1.3 trillion as of June 30, 2009. Fidelity offers investment management, retirement planning, brokerage, and human resources and benefits outsourcing services to over 20 million individuals and institutions as well as through 5,000 financial intermediary firms. The firm is the largest mutual fund company in the United States, the No. 1 provider of workplace retirement savings plans, the largest mutual fund supermarket and a leading online brokerage firm. For more information about Fidelity Investments, visit Fidelity.com.

¹All data is as of 6/30/09 unless otherwise noted. Analysis is based on Fidelity's Corp DC record kept data

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Please note that Fidelity Investments Institutional Services Company, Inc. (FIIS) 401(k) plans, distributed through investment professionals, were excluded from the data provided.

Fidelity Brokerage Services, LLC, Member NYSE, SIPC
300 Puritan Way, Marlborough, MA 01752

Fidelity Investments Institutional Services Company
82 Devonshire Street, Boston, MA 02109