401(k) Millionaires Surge, Leaving You Asking 'Where's My $1 Million?'

The number of Americans with seven-figure retirement accounts has reached an all-time high, yet many of these newly minted millionaires say they still clip coupons and avoid delivery fees. The contradiction raises an uncomfortable question: if a million dollars no longer guarantees a millionaire lifestyle, what does it actually take?

For savers still far from that milestone, the surge in 401(k) millionaires can feel more like a taunt than inspiration. Record stock gains and consistent contributions have pushed hundreds of thousands into the seven-figure club, but crossing that line offers more relief than luxury.

The Millionaire Surge in Numbers

Fidelity Investments reported that 654,000 people had 401(k) balances exceeding $1 million (£746,780) as of the third quarter of 2024 — the highest figure on record dating back to the early 2000s. The pattern is similar across other providers: Alight found that 3.2% of tracked accounts had crossed the million-dollar mark, doubling the share from late 2022, while T. Rowe Price saw its proportion rise to 2.6% from 1.3% over the same period.

Three consecutive years of strong US stock market performance have accelerated this trend. For the first time, half of American private-sector workers are contributing to 401(k) plans, with younger savers allocating roughly 88% of their portfolios to equities. Around 86% of those with seven-figure balances are aged 50 or older — baby boomers and Generation Xers who have benefited from decades of compounding.

When a Million Feels Middle-Class

Crossing the seven-figure threshold sounds transformative, yet the reality often falls short of expectations.

UBS Global Wealth Management has labelled this cohort the 'moderate millionaires' — individuals holding between $1 million (£746,780) and $5 million (£3,733,625). The Swiss bank estimates that these moderate millionaires have quadrupled worldwide since 2000 to reach 52 million. In the US alone, roughly 1,000 new millionaires are joining the club every day throughout 2024.

'Popular culture still thinks of millionaires in terms of Scrooge McDuck or the top-hatted icon of Monopoly,' wrote Paul Donovan, chief economist at UBS's wealth-management division. 'The new dollar millionaires have broken a psychological wealth threshold, but their income and spending are that of middle-class households.'

Genuine millionaire-style spending, Donovan noted, probably requires at least $5 million (£3,733,625).

Coupon Clippers with Seven Figures

Carlos Valdivia, a 51-year-old real estate professional, has dreamed of becoming a millionaire since earning his MBA from Stanford University decades ago. He maximised every retirement contribution and resisted the urge to tinker with his investments during volatile markets.

After crossing the threshold, he celebrated. 'I was like, this is awesome,' Valdivia said. 'I can't believe we've done this.'

Yet Valdivia and his wife still pinch pennies. He chooses to collect Instacart grocery orders himself to avoid delivery fees and tips. He doesn't feel wealthy. 'We're coupon clippers', he admitted.

John Ward, an 82-year-old retiree in New York, describes his rising balance as 'a very sweet place to be.' Ward is a Vanguard enthusiast, an avid follower of John Bogle, holding roughly half of his nest egg in stocks and spending his money on growth investments that have outpaced inflation. Still, he remains concerned about rising healthcare and education costs for his grandchildren.

Millions Still Left Behind

The surge in millionaire accounts belies the harsh reality faced by many Americans. A Centre for Retirement Research estimate suggests that around 40% of US households cannot comfortably live in retirement.

For UK savers observing from afar, the gap appears even wider. The average British pension pot stands at just £21,875 ($29,294) in 2025, according to PensionBee. The Pensions and Lifetime Savings Association estimates that a 'moderate' retirement income for a single person is around £31,700 ($42,452) annually, yet Royal London research indicates that 60% of workers believe they are not saving enough or are unsure about their savings.

'Where Is My $1 Million?'

The record surge in seven-figure accounts might spark envy, but the path these savers have followed holds no secret formula. They started early, contributed consistently, and resisted panicking during market downturns.

For those still asking where their million is, the answer often lies in time and patience rather than stock-picking or market timing. Valdivia spent decades maximising contributions before crossing the milestone. Ward, now 82, credits doing 'nothing' during volatility as his greatest advantage.

The harsh truth is that most savers will never see seven figures in their retirement accounts, and that is not necessarily a failure. What matters more is whether your pension pot, whatever its size, can support the life you want.

However distant the millionaire club may feel, these record numbers prove one thing: ordinary workers with ordinary incomes can get there. The question is whether you are prepared to clip coupons along the way.