Small Steps - Big Progress

'America Saves' Week an Annual Incentive to Boost Savings

Even small increases today can lead to big increases in retirement income when Done on a Regular Basis, Especially for Young Savers

February 24, 2016 — BOSTON–(BUSINESS WIRE)–When it comes to retirement savings, time can be on your side. Thanks to the power of compounding interest, the longer someone saves, the more likely they’ll achieve their retirement readiness goals.

During America Saves Week , an annual campaign, Fidelity urges people to start saving as early as possible, and if they can, increase savings each year during the campaign, even if only by a small amount. This ritual could reward people in the future, especially young savers.

“It’s encouraging to see America Saves Week and the ‘1% More’ initiative helping to boost retirement savings in IRAs and 401(k) plans,” said Jeanne Thompson, vice president, Fidelity Investments. “In fact, one quarter1 of 401(k) investors increased their savings rate last year2. We suggest people save at least 15 percent of their salary annually for retirement. Taking advantage of a company match and workplace programs such as automatic annual increase, which raises savings one percent each year, can help people achieve this goal.”

The Power of Just 1%

Last year during America Saves Week, Fidelity examined the benefit of increasing 401(k) or 403(b) savings by just one percent for people ages 25 to 55. Each age example saw additional estimated monthly retirement income, especially the 25-year-old. This year Fidelity took the analysis a step further, studying three increase scenarios to demonstrate the power of establishing ongoing savings rituals when young (image).

First, a 25-year-old earning $40,000 who increases their deferral this year by one percent could receive additional income in retirement of $190 per month3. But what if they saved an additional one percent more often?

Millennials4 will have a lot of expenses during their working lives, such as saving for a home, paying off student debt or unexpected health care costs. With this in mind, Fidelity studied the benefit of increasing savings by one percent every five years – maybe when people get a raise or higher-paying job – for a total increase of five percent over 25 years. Those who adopt this pattern could receive $690 more in monthly retirement income5.

The impact is even greater if a 25-year-old begins a savings ritual where they increase their deferral by one percent annually during America Saves Week, for a total of 12 increases. Under this scenario, they could receive $1,930 per month in extra retirement income6.

It’s encouraging to see America Saves Week and the ‘1% More’ initiative helping to boost retirement savings in IRAs and 401(k) plans

“We know life is expensive and people have competing financial pressures,” said John Sweeney, executive vice president at Fidelity. “This research clearly demonstrates the impact making small savings improvements can have on a young person’s retirement funding. The more regularly you can set aside money from your paycheck at an early age, the more grateful you may be when you retire.”

Education to Help People Build Financial Confidence

Fidelity offers a range of financial education to help people make decisions around retirement savings, budgeting, managing debt, college savings and how to prepare for the escalating costs of health care. Individuals can receive tips and information at workplace education meetings, from phone representatives, through on-demand webinars and in-person at Fidelity’s investor centers nationwide.

From Millennials to pre-retirees, many people prefer to access educational content on-the-go. Fidelity’s workplace participant experience, NetBenefits®, and other help is available over smartphones, tablets and home computers at the time that works best for the individual. Educational information may also be found on and Fidelity’s Twitter, Facebook and YouTube channels.

Additional Resources to Help Americans Understand the Power of Saving

Join the conversation :

  • Register for the Empowering ConversationsSM Webcast on March 8 to help women learn to prepare for the unexpected.
  • Learn your Retirement ScoreSM, an estimate of your ability to cover expenses in retirement.
  • Have a child working? Give them a jumpstart on retirement saving and help them learn the power of compounding by opening a Roth IRA for Kids.
  • Want to take the guesswork out of maintaining an aged-based retirement portfolio? Consider a target date fund such as a Fidelity Freedom® Fund.
  • Visit Fidelity Viewpoints® for education on college savings, paying off debt, Social Security, health care and how one percent more can make a big difference.




About Fidelity Investments
Fidelity’s goal is to make financial expertise broadly accessible and effective in helping people live the lives they want. With assets under administration of $5.2 trillion, including managed assets of $2.0 trillion as of December 31, 2015, we focus on meeting the unique needs of a diverse set of customers: helping more than 24 million people invest their own life savings, nearly 20,000 businesses manage employee benefit programs, as well as providing nearly 10,000 advisory firms with technology solutions to invest their own clients’ money. Privately held for nearly 70 years, Fidelity employs 42,000 associates who are focused on the long-term success of our customers. For more information about Fidelity Investments, visit