Updated

Updated · PBS NewsHour · Jun 28

PolitiFact Rates Trump’s $30,000 401(k) Gain Claim Mostly False as Data Shows $9,454 Average Rise

Updated

Updated · PBS NewsHour · Jun 28

PolitiFact Rates Trump’s $30,000 401(k) Gain Claim Mostly False as Data Shows $9,454 Average Rise

Q: Why isn't your 401(k) growing as fast as the stock market?

Your 401(k) usually grows more slowly than the stock market because it is not the stock market. Most accounts are diversified across stocks, bonds, and cash-like holdings, and bonds were largely flat during much of this period, which pulled down overall returns even as the S&P 500 rose about 24%. That gap shows up in the data. Fidelity, analyzing 25 million participants, found the average 401(k) balance increased by about $9,454 from the end of 2024 to March 31, 2026—far below the claim that the “typical” account gained nearly $30,000. Experts said a gain that large would generally require a starting balance of roughly $200,000 or more, which only a minority of Americans have. Your balance also reflects more than market performance. It changes based on how much you and your employer contribute, whether you reduced savings, and whether you took money out. Hardship withdrawals have been rising, with Vanguard reporting 6% of participants took one in 2025. Any withdrawal interrupts compounding and can leave an account trailing the market even during a rally. Plan design matters too. Many 401(k)s offer a limited menu of funds, often with target-date or balanced options that are built to reduce risk, not maximize short-term gains. Fees can also trim returns over time. So if your 401(k) is lagging the headlines, that is usually because of diversification, smaller starting balances, contribution patterns, withdrawals, and plan costs—not because the market gains are imaginary.

2 articles · Updated · PBS NewsHour · Jun 28

PolitiFact said Trump’s June 23 claim that the “typical” 401(k) rose nearly $30,000 in 13 months overstated the evidence, rating it Mostly False.
Fidelity data covering more than 26,000 plans and about 25 million participants showed an average balance increase of $9,454 from Dec. 31, 2024, to March 31, 2026; no age group gained more than about $16,000.
The S&P 500 rose about 24% from Trump’s Jan. 20, 2025 inauguration to June 23, but 401(k) balances lag because typical accounts hold only 60% to 65% in stocks, with the rest in lower-return assets such as bonds.
Those balances also reflect worker and employer contributions, not just market gains, and experts said median gains were likely below the roughly $9,000 average because high-balance accounts skew the data upward.
Vanguard reported 6% of participants took hardship withdrawals in 2025, up from 4.8% in 2024, underscoring that rising retirement balances may not ease near-term household cash pressures.