Trump Touts Market Gains: What Soaring 401(k)s Reveal About Jobs and Retirement Security
In recent remarks, former President Donald Trump emphasized the importance of the stock market, asserting, “We have the highest stock market in history. And they like to demean that!” His message clearly connects market success to broader economic benefits, stating, “Dems say that doesn’t matter. But that means JOBS and high 401(k)s!”
While critics argue that high market performance only benefits the affluent, findings from firms like Terex Corporation reveal otherwise. This U.S.-based manufacturer has demonstrated a direct correlation between rising stock values and increased retirement savings for employees, specifically through 401(k) investments.
Terex’s 401(k) Retirement Savings Plan reported assets of $678 million at the end of fiscal year 2021, up from $625 million the previous year—a $53 million increase. This growth is notable, especially considering the challenges of the COVID-19 recovery period.
These figures come from official audits filed with the U.S. Securities and Exchange Commission. The financials, published in the Form 11-K on June 22, 2022, illustrate enhanced retirement security for Terex employees. This growth resulted from stock appreciation, contributions from both employees and the employer, and careful management of the plan itself. A significant portion of the plan’s assets is directly tied to market performance, including mutual funds and company stock.
In fact, Terex’s combination of employee and employer contributions totaled nearly $30 million for the year. Employee contributions accounted for $18.5 million, while Terex added $11.1 million on their behalf. Even after benefit payouts reaching $78.5 million, the plan’s overall value still increased, highlighting effective management and robust market returns.
Independent auditor Mayer Hoffman McCann P.C. provided a positive assessment of the financial statements, affirming that they “present fairly, in all material respects…the net assets available for benefits.” This clean audit opinion is crucial for ensuring compliance with federal regulations regarding employee retirement plans.
What implications does this have for everyday workers? It indicates that many employees are witnessing their retirement accounts grow due to a thriving stock market—not just the top income brackets. Terex’s situation serves as a microcosm, illustrating how health in the financial markets affects middle-class workers in industrial settings. As Trump claims, rising markets can ultimately lead to increased jobs and more substantial retirement savings.
Terex’s 401(k) is managed through Fidelity Management Trust Company, which provides participants with a variety of investment choices, including mutual funds and company stock. Participants exercise control over their contributions, albeit with certain requirements and IRS limits.
The plan encourages both investment growth and adaptability. It features provisions for participant loans and was modified to include options under the CARES Act during the COVID-19 pandemic, such as early withdrawal opportunities and deferred repayments. By 2021, many of these emergency measures had phased out, allowing the plan to revert to its standard terms.
With the rising costs of retirement and potential unfunding of social programs, the significance of private 401(k) plans is expected to increase. Data from the Bureau of Labor Statistics reveals that around half of all Americans have access to a defined contribution plan. In full-time private industry, participation rates reach about 60%, and even higher in manufacturing sectors—those strongly affected by stock market fluctuations.
Despite Washington’s focus on unemployment rates or GDP growth, the impact of rising markets on workers’ retirement plans often escapes scrutiny. Over an extended period, the value of a 401(k) can multiply, particularly during sustained market gains, resulting in greater financial independence and reduced reliance on government programs during retirement.
Trump’s assertion that record market highs translate into “jobs and high 401(k)s” is supported by the data. For instance, the S&P 500 achieved a total return near 27 percent in 2021, and the Dow Jones Industrial Average also experienced notable increases. For plans linked to these indices, the resulting double-digit returns positively impacted retirement accounts.
At Terex, employees clearly benefited. Plan documents confirm that thousands of workers not only saw paper profits but also enjoyed features such as vesting schedules, employer matches, and resources available through Fidelity. Many loans previously taken are being repaid, and unused employer contributions are accruing interest—a sign of strong worker engagement and healthy plan performance.
Despite skepticism regarding the connection between stock market successes and average workers, audited plans like Terex’s challenge that narrative. Even in blue-collar environments, employees actively engage with the equity market through their retirement savings. This indicates a ripple effect where financial market growth extends beyond Wall Street.
When a company’s stock value rises, mutual fund investments perform well, and retirement plans yield considerable returns, ordinary workers experience tangible increases in their long-term wealth. In 2021, these plans displayed growth even amid pandemic-related challenges, bolstered by pro-growth tax and investment policies enacted during Trump’s administration.
The core message extends beyond the initial soundbite. Trump’s assertion—“We have the highest stock market IN HISTORY…and that means JOBS and high 401(k)s!”—carries numerical validity when examined closely.
Market growth should not be trivialized. It’s not strictly about speculative gains for the wealthy or corporate profits. It’s fundamentally connected to the accumulation of wealth in workers’ retirement accounts. For many, crossing the six-figure threshold in their retirement savings represents financial security. Terex’s plan, with its total of $678 million in worker savings at year’s end 2021, saw an impressive $50 million growth in just one year.
The bottom line is clear: while critics may label stock market gains as elements of unfounded optimism, the data from well-regulated retirement plans like those at Terex paint a more compelling picture. For the employees vested in these plans, rising markets translate into significant impacts on their futures. The connection among jobs, investment contributions, and effective company policies reveals the genuine benefits that accompany a flourishing market.
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