August 21, 2013
According to the latest stats, the average account balance for FERS employees has reached $97,075, while CSRS participants come in a fraction lower with an average account balance of $96,712. These are actually down by a few hundred dollars from average account balances in May.
Uniformed service members have an average account balance of $15,191. The lower balance is due to their later participation eligibility – service members have been able to contribute to the TSP for just over ten years now – and the relatively lower participation rate compared to their civilian counterparts. Uniformed service members also had not received a government match, at least of this posting.
(TSP participants who are CSRS employees also do not receive a government match because of their more generous retirement package, but they have been in government since at least the early 1980s so they have had many years to contribute.)
By comparison, a quarterly review of 401(k) accounts by Fidelity Investments in late May indicated that the average account balance was $80,900. “Pre-retiree” accounts – held by those 55 and over who had not retired – held an average of $255,000.
Fidelity noted that the average account balance had grown by 75% since the market lows were reached in early 2009. Average account balances then were $46,200 and $130,700 respectively.
TSP account balances grew in a similar fashion since 2009. When the stock markets hit their previous highs in October 2007, the average account balance for all TSP participants was $61,760 (TSP stats did not break out average balances for each group as they do now).
Within three months, the average TSP account balance had dropped to $58,195, and a year later, in February 2009, average account balances had dropped to $47,264. Thus average account balances have just about doubled, depending on which segment of the TSP participant population you look at.
(For an apples-to-apples comparison, the average account balance for all TSP accounts is $77,692 as of June. That’s an increase of about 65% since February 2009.)
It will be interesting to see how the July and August average balances fare. While stock markets reached new highs in July and early August, furloughs cut participants’ contributions, so that the growth will have at least slowed. While many offices had halted furloughs by mid-August, markets have begun a decline into the end of the month, so average balances are sure to drop as well.