The average account balance among American workers who consistently held 401(k) accounts from 1999 through 2005 increased 50 percent despite one of the worst bear markets since the Great Depression. Among this group, the average account balance increased 10 percent in 2005, according to a study released by the nonpartisan Employee Benefit Research Institute (EBRI) and the Investment Company Institute (ICI).

• Consistent participation in 401(k) plans helps account balances grow: The average account balance increased 50 percent among 401(k) participants who held accounts from 1999 to 2005, even though one of the worst bear markets for stocks since the Great Depression occurred during that period. Among the group of consistent 401(k) plan participants, the average account rose from $67,785 at year-end 1999 to $102,014 by year-end 2005. The median account balance (or midpoint, with half above and half below) among this consistent group also grew, more than doubling between 1999 and 2005 to $54,591.

• The bulk of 401(k) plan assets remains invested in equity securities: On average, at year-end 2005, about two-thirds of 401(k) participants’ assets are invested in equity securities through equity funds, the equity portion of balanced funds, and company stock. The percentage of assets invested in equities has varied narrowly (62 percent to 77 per-cent) over the past 10 years.

• Lifecycle and lifestyle funds continued to grow in popularity, especially among new hires: Recently hired 401(k) plan participants in their 20s currently hold a higher percentage of their 401(k) accounts in lifestyle, lifecycle, and other balanced funds than did their peers in 1998.

• Company stock as a percentage of 401(k) plan assets continued to fall in 2005: Recently hired 401(k) participants contributed to this trend; they are less likely to hold company stock and tend to hold lower concentrations of their accounts in company stock.

• Most 401(k) participants approaching retirement age do not have a loan from their 401(k) plans outstanding: Ninety percent of 401(k) plan participants in their 60s do not have outstanding loans from their 401(k) plan. Among the 10 percent of participants in their 60s that do have a loan outstanding, the loans are small relative to the participants’ remaining account balances.

• About the EBRI/ICI 401(k) database: The EBRI/ICI Participant-Directed Retirement Plan Data Collection Project is the world’s largest repository of information about individual 401(k) plan participant accounts, and at year-end 2005 includes information for 17.6 million 401(k) plan participants’ accounts in 47,256 plans with more than $1.0 trillion in assets. The 2005 EBRI/ICI database covers approximately 37 percent of the universe of 401(k) plan participants, 11 percent of plans, and 42 percent of 401(k) plan assets.

Figure Figure 17 5 5 Figure 11 Mo Motto n Ch retirem e Othe y la, ofund i, Jam Gary r recent updates on 401(k) plan en s co t d eR., an s, Dav an te fu sist d Steph id nd of tho Laib as th se e so e nfund n, an P. defau Utku s d Brig d lt inv esign s. pa Life-Cycle e itte Mad stm ed to rticipant en m t op r aian in Fund tion a tain .n “Red d plan in 200 a stab s Ma uc sp tu i5. le sha nre: onsor activities include g th Delo Pl e C ra e itte Con n pric o S m pon p e. Stable lex sor a sity Co ulting nd val LLP an sts Pa u De o rticip e fproducts suc l40 oitte LLP, d 1(k an Pe t )nsions & Adop Particip International h tio as n atio . Valley Invest guara n Th n mteed rou ents g h their asset all While these a Sarah Holo den is sen v cation in bal erage accou ior economist, Resear an nced funds. t balances provide a broad snapshot, the For exam ch Depar ple, tme n am t at th ong newly hired participants in their e Investmy en do t Co not reve mpany In al the wide ra stitute (ICI)20s hol , and nge of ding Small Percentage of ParticipantsFigure 4 Take Loans from Their 401(k) Plans Figure 5 401(k) Plan Asset Concentration in Figure 9 Figure 13 Recently Hired Participants Now Hold investm ( Fo 200 Fo un rg ent contracts (GICs; Qu 5) dat e, PA: The Van rick e io po n, a En rt n tro h d at llmen Int ine 20 rg n t.” u at 04 aird Cen NB which a o , nal only ER Soci Wo t1 er r7 e i p et for Retiremen rk n y eing sura r o cen f Pap C nce c t of erte p ir fo i.lan e No m d Em t Res p s w any pr . 11 ith earch and T pl 9oy 7 auto oducts that 9ee B . Cm am e anefi tic en bh ri e dge, tVa S guarantee a ro pnguard ll eci M men A al:i Nat s t u ts Gr (2 s specifi ed iou onal 00 a lifestyle o p, No 6); B c rate Ut uv re e kus a m uof b of a er r ret n targ 20 Eco d Y u05 ret o n nun o . retirem on m g the i (M c Rarc een search h t d ate , indivi balanced funds in 2005, dual par Jack Van ticipants’ Derhei, Tem experiences. In t p41 percent have le University, is research he consistent more than direct 401(k) participant 90 percent of t or of the EBRI Fellows Pro heir account in balanced funds; am group, younger partici gram. Special th pants (or thos anks to ong the e Figure 2 More Than Hal Percentage of eligible 401(k) participan f of Participants With Sma ts with loans, by participant age, 2005 ll Accounts Are New to Their Jobs Account Balances Increase With Age and Tenure More 401(k) Plans Offer Lifestyle, Lifecycle Funds Recently Hired 401(k) Plan Participants Are Less Likely to Hold Company Stock Equities Decreases With Participant Age inve fu 2006); He sted ndJanu as t caph ital o ar e witt y 2 def v 006 Associates a eul r tt . h ie life nvestm of th (2006); a ent o e con pHigher Concentrations in Balanced Funds tio n tn ract) d Fideli . and ty Investm other stabl ents (2005). e value funds Othe (wr hi recent rese ch include arc syh nt on retirem hetic GICs ent plan pa , which corticipants nsist Luis Alonso, research associate at EBRI, who managed the database. Munnell, Alicia H., Annika Sundén, and Catherine Taylor. “What Determines 401(k) Particip1 ation and Cont 2 ributions?” with fewer y co mparable g ears of tenure at their current em roup in 1998, 8 percent had such a con ployer) experienced the largest centration (Figure 11). This increases in aver upward trend age account in usage Average Account Balances for All Age Groups Exceed 1999 Levels in 2005 Percentage of participants with a 401(k) account balance less than $10,000, by tenure, 2005 Average 401(k) account balance by age and tenure, 2005 28 of a EBRI, ICI Maintain Largest 40 in pcl ortfo udelio s Ag of fi new (M xed-in aco Percentage of plans offering lifestyle and/or lifecycle funds, 1996–200 rch m 20 e securitie 06); BePercentage of recently hired participants offered ss “wrap hears, C phoi ed” , Lai with b1(k) Participant Database a son, a guan ran d M tee (typ etrick ically b (Februy ary an 2 i0 n0 su 6) ran ; Cce co hoi, Lai 5m pb any o son, an r a d M bank adri ) to a n Percentage of recently hired participants Delo CRR Working A si itte Con m ilar pat sultin tPaper, ern g LLP., occNo urs. acr In 200 tern oss al 0-1 ation 2, Ch l aagl Foun e estnut Hill, MA: Cen groups dation (se 22% e , and Appe Intern ndi ter x Fi ation fogu r Retiremen a re l So A3 ciety o 0). t Research at Bo f Certified Emp ston loyee B Co lleg enee, fit Average asset allocation of 401(k) accounts EBRI Issue Brief balances bet occurs in all age groups. $200,000ween year-end 1999 and year-end 2005. For example, the average account balance of This report is being pu Average a blished sim cu co ltan unt balan eously as an ces amon EBRI Iss g 401 ue Brief (k) parti andcipa ICI Pers nts pre pective sent and is available Figure 3 1, 2 29 and holding company stock, 1998–2005 provide (Janua bery nefit 20 paym 06); Pot ents according t erba, Raub, Ve ont the i, an pld an at Wise ( book Jan value) are uary 2006 re ); a porte nd L du as sardi one cate and M gory. The itchell (2 “ot 006) her” . category is the 20% 1 Decem Specialists. ber 2000. Annual 401(k) Benchmarki holding balanced fund assets, ng Survey, 2005/2006 Edition 1998 and 2005 . New York: Deloitte Consulting, LLP, 2006. 1 2 For more detail by participant age group and investment menu, see Appendix Figure A32. participants in their 20s i The increased use of balanced funds am ncreased 695 p by partici ercent between pant a ong recently hi ge, perce the end ntagered participants can also of assets, of 1999 and 2005 the end of be seen in the average 2005 (Figure 2). Th is on both organizations’ Web sites at www.ebri.org and www.ici.org 19% 19% Over the past two decades, from year-en 401(k) d 1999 th plans rou have grown gh year-en tod 2005 be the m by o age, st common type of em 1999–2005 ployer-sponsored 6 residu al for other investments su More Than One-Third of 401(k) Participants Are ch as real estate funds. The final category, “unknown,” consists of fund 60ss that could not 30 For additional details on the composition of plans, participants, and assets in the EBRI/ICI Participant-Directed Issue Brief Poter Delo ba, Jam itte Con es, Joshua Ra sulting LLP., uh, and Steven Ve Pensio nti, a ns &n Investments d David Wi. se 2004 . “Lifecycle As Annual 401 set (k)Allocation Strategies Benchmarking Survey an . New York d the : Deloitte At year -end 2005, nearly half (or 8.3 million) of the 401(k) participants in the EBRI/ICI database were in plans that dram 401(k) account asset allocation. For exa atic increase reflects the strong impact of contribu mple, at yeations on account r-end 2005, 19 percent of the account balances of balances for this age group. Because retirement plan in the Unite % d States, and now serve as >30 Yea the m rs ost popular defined contribution (DC) plan, as 70 be identified. See further discussion in the Appendix. 2 Retire ment Plan Data Collectio in Their 20s or 30s or Have Short Job Tenure n Project database, see the Appendix, which is available onlin ®e at: ® Percentage of Account Balance Invested in Balanced Funds Distribu Constio ultin n of 40 g, LLP, 1(k)2 Retiremen 005. t Wealth.” NBER W orking Paper . No. 11974. CambrF idg ixed e, M -Income A: National Bur eau Age Group 1999 2000 2001 2002 2003 2004 2005 offerNot com e:p T any he el stock ectr as a onicn ve in rsi ve ostm n of e t nt h opt is pu iobl n. Am ication ong t was he creat se part edi c usi ipa nn g ts ver , ab siout on 6. tw 0 oo -tfh A ird ds o b hol e d Ac 20 ro pe bat. rcen Th t or os le e ss of their their initial account balances tend to be s recently hired participants in their 20s is mall, contri invested in butions pr balanced funds, oduce significant account-balance growth in a compared with 16 percent in 2004 and measured by number of participants and asset >20–30 Years s. In 2005, 47 million American workers were active 401(k) 48.5%* $160,000 No. 296 This ww syw.i stem ci of .org/ clp assi df/per ficat 12 ion -01 d_a oes ppe no ntdi co x.nsi pdf d er the n (Among Those Holding Balanced Funds) umber of distinct investment options presen ® ted to a gi ®ven Percentage of 401(k) plan participants by age or tenure, 2005 2 of Economic Research, Janu 11 ary 2006. account Employ ee Ben balanc 20s e es in c fit Research ompany $3,042 Instock, incl stitute. “His $5,507 udi tory of ng 40 pe 401(k) Pl rce $7,892 nt wh an o do s: An Upd not hold $9,378 ate.” com FACT p $15,003 any stoc S from EB k at all (see $19,781 RI. EmAppendi ployee B $24,169 x Fi enegure fit having trouble A 1ge G open rou ing p the p Ed quit f dy F ocu und ms ent will n Compa eed to ny S tup ock grade th Balan eir co ced F mp und uter to s AdS ob ecu eriti Reader es 50s 6.0, relatively about 7 E BRI Em short time span. ploye percent am e Benefit Rong that age group i esearc h Institute Issue Brief n 1998 (ISSN (Figure 0887 -137X 12) ) is . Sim publishilarly, at ed monthly b yyear-end 2005 the Employee Be , nearl nefit Rey s ear 17 percent of ch Institute, plan participants. By year-end 2005, 401(k) plan assets had gr 3% 1998 own to represent 17 percent of all retirement th participant, but rather the types of options presented. Prelimin 5% ary research analyzing 1.4 million participants drawn This update extends previous findings from the project for 1996 through 2004. For year-end 2004 results, see Holden 2121 K Street ,30s NW, Suite 600, Was19,267 hington, DC 2021,748 23,996 23,806 34,948 037-1896, at $300 per year or is included as part of a membersh43,555 ip subscription50,930 . Prof A2 it Sh 9) Research In . ar In in co g/4 nt 01( rast 11% k) stitu , 1 C 0o te, Febru perce uncil of nt A h aa ry 20 m ve m erica ( 05 ore t . Ph SCA an 80 ). pe 48rce Annual Survey of Profit nt of their account balaSharin nces ing and 401(k) vested in com Plans: pany st Reflecting ock. (Appendix which can be downloaded for free 2 at www.adobe.com/products/acrobat/readstep2.html % 20s 51.9% 10.4% 15.5% 20.2% 65 August 2006 the account balances of new hires in their 60s is inves Age Group >0–50% ted >50–90% in balanced funds, com 0–2 Years >90% pared with about 16 percent assets, with $2.4 trillion in assets. In an ongoing collaborative effort, the Em 10%ployee Benefit Research from the 2000 EBRI/ICI database suggests that the sheer number of investment options presented does not influence Periodicals postage rate paid in Washington, DC, and additional mailing offices. POSTMASTER: Send address changes to: EBRI Issue and VanDerh 40s ei (September52,402 2005 and Sep53,635 53,953 50,231 68,203 tember 2005—Appendix). Results for earlier years are av81,352 ailable in91,848 earlier Fi 2gu 004 re Pl Aa 2n 9 Year Exp also repoe rtrien s thce e as . Ch seticago al29 locat , IL: ion Profit distribut Sharing ion of /40 pa 1rt (k) C icipant ounci acc l o of unt Am bal eri aca, 2 nces t 0o 0 com 5. pany stock by age.) Fidelity Investments. Building Futures, Volume VI: How Workplace Savings Are Shaping the Future of Retirement (A 20s 3 >10 –20 Ye 84.9% ars 7.3% 4 7.8% 30s 57.6 11.4 11.6 17.2 39.4% in 20 04 and 12 percent in 1998. Brief, 2121 K Street, NW, Suite 600, Washington, DC 20037-1896. Copyright 2006 by Employee Benefit Research Institute. All rights partInstitute (EBRI) icipants. O thn averag and the Invest e, participants have ment Co 10.4 di mp stany inct I on pstitute (ICI) tions but, on a collect annual data on m verage, choose only 2.5 (see H illions of 401(k) olden and plan 31 50s 85,174 85,072 12% 83,722 77,285 100,359 40s 116,349 127,766 issues of EBRI Issue Brief (http://ebri.org/publications/ib/) and ICI Perspective (www.ici.org/perspective/index.html). 61.0% _______ $120,000 _. 47 Annu 30s al Survey of Profit Sh86.0 aring and 401(k) Plans: Reflectin 7.6 g 2003 Plan Yea 6.4 r Experience. Chicago, IL: re A si serv Rep ed m , N io lrt a o.r t o 296. rn end C 60.5% o occ rpor uat rs ac e Def ross age ined C g or nt ou rips but (i so ee A n Plp ans) pen. Bo dix Fi sto gu n, MA: Fi re A33). delity Investments, 2005. 5 40s 52.9 13.6 10.9 20.2 28% VanDerh 7 ei (M ay 2 60s 001)). In ad125,811 dition, the pr119,611 114,465 104,323 126,372 elim 60.0% inary an Figure 1 alysis found that 401(k) participants are no137,407 t naïve—that is, 140,957 participants as a means to accurately portray how these participants manage their accounts. 32 See Holden and Va 40s nDerhei (January/Feb 84.1ruary 200 By Age 1) for the su 8.9 mmary of the year-end 19 7.099 results. Profit Sharing/401(k) Council of America, 2004. % 60 1 Hewitt Asso See Appenciates. dix Figu How Well re A32. At Are Empl plans th oyees Saving at offer comp and anyInvesting i stock as an n i 40 nve 1(k) stm Plans (2006 ent opt 33.1% ion (but Hewitt Universe Benc no GICs or stable val hmark ue s). 401(k) Plan Asset Allocation, Account Balances, and All 50s 45. 67,785 3 67,585 66,834 61,939 80,506 13.7 11.0 27.6 93,085 102,014 whe n give n “n” options they do not divide their assets among all “n 32.1% .” Indeed, less than 1 percent of participants Allocation to Company Stock Declines 8 th 401(k) Account Balances Increase for Third Consecutive Year 50s 81.1 10.7 8.2 This report serves as an update of EBRI and ICI’s ongoing research into 401(k) plan participants’ (Median Age: 44 Years) The Employee Benefit Research Institute (EBRI) was founded in 1978. Its mission is to ____ ___ When analyzing the c _. 46 Annual Survey o hangef i Pro n acc fit Sh ount arin bag and lances 4ov 01er tim (k) Pla e, it is i ns: Reflectin mportan g 200 t to h 2 Plan ave a con Yeasri sExp tente sam rience ple. Co . Chicag mparin o, IL: g fundLin s), ab coou lns t h 13 ire, pe IL: Hewitt Associates, LLC, rcent of the year-end 2005 acco 20 1 06 un . t balances of recently h 30.0%ired participants is invested in company Source: Tabulations from EBRI/ICI Participan6 t-Directed Retirement Plan Data Collection Project. followed a “1 /n” asset allocatio 60s60s 37. n strategy. 77.08 11.1 12.410.2 10.638.6 401(k) account balances amon 58.7% g 401(k) participants present The share of company stoc contribute to k in the EBRI/ICI database , to encourage, and to enhanc continued to fall in 2005, to 13 percent of asset e the development of sound employee benefit s at activity through year-end 2005. The report includes two sections: The first focuses on account balance av Pr erag of 1it Sh e accoun aring/t b 401( alan k)ces acro Council of ss d A ifferen merica, 20 t year-en 03. d sn 27.6% apshots can lead to false conclusions. For example, the addition of stock, compared with about 18 percent in 2004, and 24 percent among recently hired participants in 1998. At plans that 20 Loan Activity in 2005 Figure analyzes sample of 3.5 million 401(k) plan participants with account balances at the end of ea2ch year from 1999 through 2005. Holden, Sarah, an Alld Jack VanDerhei. “4 84.5 01(k) Plan Asset Allocatio 8.2n, Account Balances, an 7.3d Loan Activity in 2004.” ICI $80,000 All 47. programs and so9 und public policy12.9 through objective 10.9 research and26. educati0 on. EBRI is the only On average, thin the year-efrom ye nd 2005ar-en EBRd 1999 th I/ICI database, rough ye 48 perce ar-en nt d 2005, of account 199 bal 9– anc 2005 es are invested in equity funds. year-end (Figure 6). Although some of the decline since 2000 reflects a drop in stock prices during the 2000– 2 information for participant 55% s who consistently m 60s aintained accounts between 1999 and 2005. The second a large number of new plans (arguably a good event) to the database would tend to pull down the average account _______ Ag _. e gr 45oup i Annu s basea d o l nSu par rvey o ticipant ag f Pro e at ye fit Sh ar-end arin 2005. g and 401(k) Plans: Reflecting 2001 Plan Year Experience. Chicago, IL: offer both company stock and GICs or stable value funds as investment options, nearly 14 percent of recently hired 20s Perspective. Vol. 11, No. 4, and EBRI Issue Brief, No. 285 (Investment Company Institute and Employee Benefit private, nonprofit, nonpartisan, Washington, DC-based organization committed exclusively to ThereW isTabl a wi ho we are de va e of riati Contents Sour on i ce: n Tab 40 u1( latio k) ns fr pl om a n EBR part I/ICi I Par ciptant icipas nt- ’ asset Directed R ae ll tiro ecat menti Plan D on toa e taq Cui ollection ty fu Pr noject. ds: More than one-fifth of the 401(k) 2005 55.3% 2002 bear market, the share of assets held in company stock in the EBRI/ICI database continued to drop provides a snapshot of all balance, which could then be401(k) mistakenl participants at y y 21.2% described as h ear- urtie nnd 2005, and reviews their account balances, asset g current participants, but actually would tell us nothing ProfBy Sarah Holden, ICI, and Jack VanDerhei, Temple University and EBRI Fellow it Sharing/401(k) Council of America, 2002. participants is inve 20ssted in company 30s stock, compared wi 40s th 15 perce 50s nt in 2004, and al 60s most 19 perce An ll A t am gesong those 20.4% Research Institute, September 2005). 1 public policy res 24% earch and education on economic security and employee benefit issues. >0–50% >50–90% >90% participants in the EBRI/IC Minor investm I database at ent categories year-end 2005 hold are not shown; therefore, row m per ore centthan 80 ages do notperce add to 1n 0t 0 per of t ceh nt. eir account balances in equity th Age Group 30s during the stock market’s rebound. This suggests changes in plan design and participants’ behaviors. about consistently participa 2 ting workers. Similarly, the aggregate average account balance would tend to be pulled allocations, and loan activity. ____ recently hi ___ _. 44 red in Annu1998. al Survey of Profit Sharing and 401(k) Plans: Reflecting 2000 Plan Year Experience. Chicago, IL: Fixed-income securEBRI’s member ities include bond funds, ship includes a GICs (guaranteed inv cross-section of estment contracts) a pension funds; businesses; trade associations; nd other stable value funds, and EBRI, ICI Maintain Largest 401(k) Participant Database ................................................................3 ________. “App20s endix: Additional Fig47.5% ures for the EBR Averag I/IC e I Particip 11.9% ant-Directed Retiremen 40.6%t Plan Data Collection fund, while about one-third of pa >5 rticip –10 Ye anars ts hold no equity funds (see Appendix Figures A24 and A25). However, in % 50 money funds. 8% 51.6% d 33 own In contrast, th if a large num 14.8% e average account ber of older participan balance of older ts happened to re parti tire and cipants (particularly roll over their acco tunt b hose with longer te alances. In addition nures) , changes Not all 401(k) plan participants are in plans that offer com 11% pany stock as an investme$1 nt option. 02,014 To Prof $40,000 it Sh Source: T aringabulations from E /401(k) Coun BRcil of I/ICI Pa A rticipant-Directed merica, 20 Retirement P 01. lan Data Collection Project. labor unions; health care providers and insurers; government org 51.0% anizations; and service firms. In the 2005 EBRI/ICI d 30s atabase, 85 p55.5 ercent of participants are in p 12.3 lans offering loans. 32.2 • Pro ject fo Consistent p r Year-Enarticipation in 401(k d 2004.” ICI Perspective. ) pla Von l. s help 11, Nos acc . 4A (Inv ount balanc estment Co em s grow pany Institu : Thete, Sep average tember 2005— EBRI, ICI Look at 3.5 Million Consistent 401(k) Participants.........................................................3 28% aggregate, about 55 percent of participants with no equity fund balances have exposure to the stock market through 12.1% rd in the sample of recordkeepers and/or changes in the set of plans for which they kee $93p,0 8 rec 5 ords can also influence the 34 showed much slower growth. For participants in their 60s, the average account balance rose 12 percent understand trends in participan 40s 50s t behavio 53.5 r in regard to com 12.8 pany stock, it is important to focus o 33.6 n those 401(k) ________. 43 Annual Survey of Profit Sharing and 401(k) Plans: Reflecting 1999 Plan Year Experience. Chicago, IL: EBRI, ICI Look at 3.5 Million Cons Appendi Ave x)r. age Account Balance Grows 10 Percent in 2005 istent 401(k) Participants ................................................................................3 For exam account balance increased 50 percent ple, see Utkus (July 2005); Mitchell, Utku am s, a ong 401(k) participants who held ac nd Yang (2005); Holden and VanDerheicounts from (October 200 1); com pany stock or balanced funds (see Appendix Figure A26). 30 change in aggregate average account EBRI’s work advances knowledge and unders balance. Thus20s , to ascertain what is happetanding of emplo ning to 401(k) payrticipants’ account ee benefits and their 50s 50.2 Figure 8 13.4 36.4 between year-end 1999 and year-end 2005 (Figure 2). Annual contributions generally provide a minor boost plan participants that do Profit Sharing/401(k) Coun have acce cil of Amss to c erica, 20 om 00 p. any stock. In addition, focusing on the behavior of recently $80,506 21 ________. “The Influence of Automatic Enrollment, Catch-Up, and IRA Contributions on 401(k) Accumulations at Munnell, Sundén, and Taylor (December 2000); and U.S. Government Accountability Office (October 1997). EBRI/ICI Database Covers More Than 17 Million 401(k) Participants in 2005..............................5 1999 to 2005, even though one of the worst bear markets for stocks since the 7 Great 45 Figure 16 Research indicates that in a % ny given year, 401(k) p 24% lan participants generally do not rebalance or chang46.3% e the asset nd 60s importance to 44.2 the nation’s economy 12.4 among policymakers, the news 43.4 media, and the public. It balances, a consistent set of participants must be analyzed. About one-third of the participants with 401(k) plan accounts at the end of 1999 —3.5 million Asset Allocation to Equities Varies Widely Among Participants 35 to large account balances, compared with the impact of investment returns. In addition, participants in their ____ hired particip ____. 42 Ann ants draws out inform ual Survey of Profit Sharin ation about the im g and 401(k) Pla pact of current plan design a ns: Reflecting 1998 Plan Yearnd ot Experience her cont . Ch em icag poraneous o, IL: Retirement.” ICI Perspective, Vol. 11, No. 2, and EBRI Issue 25% Brief, No. 283 (Investment Company Institute and >2–5 Years Account Balances Rise With Age and Tenure............................................................................................ 5 For ad $6 $0 7 d,7 itional lo 85 an activ $67,585 ity analysis, see the Appendix. allo9 cation in their Depression o accoun All ts. Fo ccurred duri r exam does this b ple, Mitch ng that period. Am 51.5y co ell, Mo nducting ttola, U and p tong the group of co ku ublishing policy re s, an 12.4d Yamaguchsear i (2 nsistent 401(k) plan ch, analysis, 006)36.1 find that and 80 per special reports on cent of Loans $66From 401(k) ,834 Plans Tend to Be Small 30s 12 The average account balance ($102,014) among the 3.5 million consistent participants is higher than the average individuals—maintained these accounts at the end of each year from 1999 through 2005. An examination of Profit Sharing/401(k) Council of Asset alloc America, 19 atio99 n distrib . ution of 401(k) participant account 60s have a hi Employee Ben gher propensi efit Research ty to m Institu ake withdrawals. te, July 2005). $61,939 Nevertheless, even for these older participants, factors on individual participants’ 36 decisions. Bulk of 401(k) Plan Assets Invested in Equities......................................................................................... 7 Source: Tabulations from EBRI/ICI Participant-Directed Retirement Plan Data Collection Project. employee benefits issues; holding educational briefings for EBRI members, congressional and 401(k) p W Tha e m rticipan hat we do ediants lo in an itiated balance no trad outstand es ining the is two $3 years ,661 at year observ -e ed nd (200 2003–3 5. 004); Hewitt Associates (2006) reports that Percentage of eligible participants, by age, 2005 participants, the average account rose from st $67,785 at year-end 1999 to $102,014 by 1 2, 3 account balance ($58,328) among 1 the 17.6 million 401(k) plan participants in the year-end 2005 database because the this subgroup of consistent participants helps to more reliably portray the growth of 401(k) plan account The analysis includes the 0.4 million recently hired participants (those with two or fewer years of tenure) holding balanced funds in 1998 ____ continued contributi ____ ______ _. 41 _. “4 Annu 01(k a) Plan Asset Allo l Survey o ons thr f Pro oughout t fit Sh cation arin h,e bear Acco g andun m 40 t Balan a 1rket h (k) Pla ce es, an n lped to m s: Reflectin d Loan itigate the im Activ g 199ity in 7 Plan 20 pact of the equit Yea 02.” r Exp ICI Pers erience pective. . Ch y market icag Vo o, IL: l. 9, No. In the EBRI/ICI database, t balance to e here is a downward tr quities by age, pe end i rcentag n com e of par pany ticipants, stock investing am 2005 ong recently hired 37 Lifestyle and Lifecycle federal agen Funds Gain cy stPopula aff, and th rity e news .................................................................................. media; and sponsoring public opinion surveys on emplo .........y9 ee 40% 11.9 percent of participants in their system made both a transfer and an investment change in 2005; Utkus and Young The m 1996 edian loan am and the 0.9 million recently hired participants holding balanced funds in 2005. 1997 ount outstanding as a 1998 1999 percenta 2000 ge of rem 2001 aining account balanc 2002 2003 e is 16 perce 2004 nt. 2005 consisteny t p ear-en articipd 200 ants h5. The m ave longer ten edian account balance (or m ure, on averag Years of Tenure e, compared with th idpoint, with h e entire datab alf above an ase (and accoun d half t balances tend to balances over Prof 5, a it Sh nd arEB ing RI Is / time than do 401( sue k) C Brief oun, No cil of point-in-tim . 2 A 6m 1 (Inv erica, 19 estm e snapshots of 98 en. t Company Institu all 401(k) pla te and Emp nAge G participants. More specifically loyree Ben oup efit Research Institute, , 2 benefit issues. EBRI’s Education and Research Fund (EBRI-ERF) performs the charitable, decline on their account balances. Allocation to 1998 Com 1999 pany Stock 2000 Declines ........................................................................................... 2001 2002 2003 2004 2005 ......... 11 401(k) plan participants. Today, less than one-half of recently hired participants who are in plans that offer Row percentages may not add to 100 percent because of rounding. 31% (Mar 38ch 2006) report that 13 percent of The Vanguard Group’s DC plan participants made a trade in 2005 (not counting Median Tenure: 4 Years th rise with tenu The loan amount is calc re). Indeed, tu hlated as e minim a um perce tenn ut ra e in th ge of t e hcon e rem sisten ainitn gr g acc oupou at y ntear bal -a ence nd 200 afte 5 is six r the lo year an am s. ount has been below) among this consistent group also grew, more than doubling between 1999 and 1 September 2003 Loan as ). a Per educa centage of tional, and scientif ic functions of the Institute. EBRI-ERF is a tax-exempt organization ____ focusing on consistent participants ____. 40 Annual Survey of Profit Shrem aring and oves variations in average acc 401(k) Plans: Reflecting 199 ount balances caused by 6 Plan Year Experience. Ch participants icago, IL: Source: Tabulations from EBRI/ICI Participant-Directed Retirement Plan Data Collection Project. Plans Offering 401(k) Loans Are Common, but Loans Are Rarely Taken............................................... 11 Percentage of Account Balance Invested in Equities plan-spon company sor-in stoc duced k as an investment option a investment option changes); an ctually d Fi hol delity Inv d it, com estmen pared w ts (20 ith 61 05) find percent of recently s 13 percent of DC p hired lan 10 Source: Tabulations from EBRI/ICI Participant-Directed Retirement Plan Data Collection Project. 8 withSource: Profit Sharing/401(k) Council of America, Annual Surveys. drawn. Generally, p Remai articip ning Acco ants unt Bal may bance orrow the lesser of $50,000 or 20s one-h 40s alf of 60s the elig Alib l le vested 401(k) account The Note: The analysis includes 401(k) plan participants with two or fewer years of tenure in the year indicated and in a plan offe S&P 500 total return index increased supported by co 49.7 percent ntributions and g between Decem rants. ber 2002 and Dece ring company stock as an mber 2005. The Russell 2005 to $54,591. 31 _Pr ___ of___ it Sh A_. “Can ge aring/4 01( 401( k) k) C A oun ccum cil of ula A tio m ner s ica, 19 Genera 97 te Sign . ificant Income for Future Retirees?” ICI Perspective. Vol. 8, No. and plans ent Note: The average account balance among all 17.6 million 401(k) plan participants is $58,328; the median account balance is $19 ering and leaving the EBRI/ICI database. ,398. Bibliography....................................................................................................................................14 particip participants in 19 ants in their system 98 (Fig mad ur ee 13). exchang Not onl es in 200 y are fewer recent hires holding com 4. Holden and VanDerhei (September 2p 003) analyze any stock, b changes ut fewer recent in year- * Preliminary. Source: Tabulations from EBRI/ICI Participant-Directed Retirement Plan Data Collection Project. investment option. balance. Loan ratios greate Zero (No r than 50 Loan) percent are reported in Figure 16 beca 89% use 78% the lo 90% an is 81% calculated as a percentage of Group Zero 1–20% >20–40% >40–60% >60–80% >80% 2000 to 1 tal return index, which represents the smaller of the large corporations, increased 82.2 percent over the same 3, and EBRI Issue Brief, No. 251 (Investment Company Institute and Employee Benefit Research Institute, At year-end 2005, 6.6 million participants, or 37 percent, have account balances less than $10,000. Russell 2000 Index. Tacoma, WA: Frank Russell Company. end asset alloc Endnotes ations am ....................................................................................................................... ong 5.3 million EBRI/ICI database 401(k) plan participants with accounts at the................... end of each 16 hires are holding high concentrations of company stock. For example, among recently hired participants 2 1–10% 3 8 5 7 • The bulk of 401(k) plan EBRI Issue Brief assets remains invested i is a periodical providing n equity sec expert evalua urities: tions of On average, at employee benefit issues and the remaining account balance: A loan of one-half of the account balance would produce a ratio of 100 percent. EBRI/ICI Database Covers More Than Average Account Balance Grow periodJ (see ob tenur A e isp gpen enerad llyi yx ea Fi rs wg oru kin re g aA7 t curr). ent employer, an s 10 Percent in 2005 d thus may overstate years of participa 17 Million 401(k) Participants tion in the 401(k) plan. 20s 18.5% 2.6% 4.7% 8.8% 30.8% 34.6% November 2002). Set year h fr i-Iy om enga 1 999 r, Shee throna, ughG 2u 002. Cho r Huberm i, Lai an, an bson d Wei , Mad Jian rian g., “H and ow Metr Muick ( ch CJhoi uly 2 ce i 004 s To ) fo M ind t uh cat 4 h? C 01( ont k) ri but plan io p ns t articip o 40an 1(ts r k) arely 40s >10–20% 2 trends, as well as critical analyses of employee benefit po4 licies an2 4 d proposals. EBRI Notes is a offered co 11 mpany stock as an investment option, a little more than 5 percent of them held more than 90 year-end 2005, about two-thirds of 401(k) participants’ assets are invested in equity In any given year, three factors contribute to changes in a participant’s account balance: ____ There ten ____. “Ap 30d s s to p e bnd e a ix 13. po : EBRI/I sitiv 3 e co CI rrelatio 401 3.1 (k) n b Ae ctcu wm een job ulatio tenure an 4.9 n Projectio d acco n Mod un et l.,” 9.5 balan ICI Pers ce in each pective. o 25. f th 6 Vo e l. 10 8 years co , No. 3 43. A v 7 ered by the make changes after the initial point of enrollment. Investment Company Institute (March 2001) finds that 89 per-cent of in 2005 Retirement Plans.” In Olivia >20–30% 2 S. Mitch periodical providing curr ell and Stephen P. Ut ent in kfu ormation s, eds., Pen on a variety sion3 Desi of g1 n and S emplo2 y tru ee b ctuernefit to e: New Lesson pics. EBRI’s s percent of their account balance in company stock in 2005 (Figure 14). Among the comparable group in EB R • (In I /IC ve I New contributions b securities through equit stm date an base a t Com np d am any In ong t stitu y h e the p te, No pa yrt funds, the equity ia c v rticipant and/or the em ie pm an bts in th er State 2002 me con ent —App of s por isten Oend wners tion of balanced funds, and com t group ix). plo hip y e (tho r. se with account balances at t pany stock. he end of each 40s 13.1 4.1 5.7 10.4 24.3 42.5 equity m From u Beha tual fu vio ndr sh al Finan arehold ce. ers in DC Oxf>30–80% 4 Pension Investment Report ord, U plan Ks : Ox mad foerd no U red nive ersity mp pt rio ov Pr n ides det sess, or rede 200 ailed fi 4 m : p 83– tio nanci6 n 95 ex a . l in chan2 formation on th ges in 1995 8. In e univ ade drse of defin ition, ed O19 ur 99 2000 2001 2002 2003 2004 2005 United States Postal Service Statement of Ownership, Management, and Circulation. 1998, 12 percent had such a concentration. This downward trend in usage and concentration occurs in all age Figures year fro _______ m _. “The I at least 19 mp99 act o thro f Em ugh 200 ployer 5). Gi -Selected ven th Inv at ag estm e and ent t Op enu tion re are s ono 401 ften correlated, th (k) Plan Particip ere also tend ants’ Asset s t Allo o be catio a po ns: sitive • The y Total investment return on The percentage of assets invested in equities has varied narrowl ear-end 2005 EBRI/ICI database, account balances, which incl which depends on m udes information for 17.6 m ay r k (62 percent t et performance and the illion 401(k) o 77 per- plan 50s 14.4 >80% 1 benefit, defin 5.9 ed contribution 7.2 , and 401(k) plans. 11.7 EBRI 1 Fundamentals of Employe* 1 23.5 37.3 e Benefit Investment Company Institute (Spring 2000) finds that 81Figure 6 percent of 401(k) plan households surveyed made no 1. Publication Title: EBRI Employee Benefit Research Institute Issue Brief. 2. Publication Number: 0887-137x. 3. Filing Date: 08/15/2006. Figure 12 S&P 500 Index. New York, NY: Standard & Poor’s. Figure 14 Bulk of 401(k) Plan Assets Invested in Equities Figure 10 groups. correlation bet Preliminary w een age Finding and a s.” Wo ccount rking Pape balance r pre . See Figu pared forre The 5 an C d enter Appefor ndix Fig Pensiu or n and Retire e A6. ment Research (CPRR) 4. Issue Frequency: Monthly. 5. Number Programs of Issues Publis offers a straigh hed Annually: 12 tforward, basic explan . 6. Annual Subscription Price ation of : $300 emplo per yyear or ee ben is efit progr included as part o ams in the f a participants’ accounts in 47,256 plans Source: Tabulations from EBRI/ICwith m I Participano t-D re than irected Re $1.0 trillion in assets, all tirement Plan Data Collection Project. ows for an accurate present- cent) over th allocation of asset e past 10 s in the individual’ years. s account. allocation chang 60s es in the 12 19.8 months preced 8.3 ing the survey (A 8.0 ugust 1997 throu 11. gh 2 September 199 19. 8) 9 . 32.6 401(k) Plan Assets Concentrated in Equity Funds Recently Hired Participants Now Hold More Balanced Fund Assets By Tenure U.S. publications Gov Figure 1, ernment Accou 401(k) Account ntab ility Office (GAO; Balances Incr form ease for Thir erly General d C Accoun onsecutive Year ting Office). “4 ........................................... 01(k) Pension Plans: Loan 4 12membership subscription. 7. Complete Mailing Address of Known Office of Publication: (Not printer): Employee Benefit Research Institute (EBRI), Fewer New Participants Hold High Concentrations in Company Stock 13 Consistent with a long-ter The decreased use of compan m invest More Recent Hires Hold Balanced Funds y stock a ment horizon, mong recently hi 401(k) plan parti red participants is also reflected in the average cipants tend to be heavily invested in Current Pension P * Less oli tha cy n Iss 0.5 per uprivate and public sectors. es cen C t. onference, at Miami U EBR niv I Databook o ersity, O xfon rd Employee Benefits , OH, Jun e 8–9, 20is a statistic 01. Draft, May 2 al refer 001 enc. e 22 2 For statistics indicating the higher propensity of withdrawals among participants i1 n their 60s, see Holden and day snapsh • Withdrawals, borrowing ot of 401(k) plan participants. , and loan repa yments. Particip 2121 Kan S All tts ree in t NW, their 20 Suite 600 s 15. ho , Washing0 4.5 ld appro ton, DC 20 ximatel 037. y 2 8. pe Complete Ma rcent o5.9 f th iling e to Atal assets in ddress of Headqua10. th3 e 200 rters o5 EB r General RI/ICI d Bu24. siness Office6 39. atabase o ; p f Pa urticip blisher (No6 ants t 401(k) plan average asset allocation among participants with two or (Median Tenure: 8 Years) 401(k) plan average asset allocation, percentage of total assets, Median selected years 17 Provisions Enhance Participation But May Affect Income Security for Some.” Letter Report, 10/01/97, GAO- Note: C Percentage of recently hired participants offered company stock holding the olumn pervolume on centages may n emplo ot add to yee b 100 pe er nef cenit pro t becaus grams e of roundi and work ng. force related iss ues. • Lifecycle and lifestyle funds continued to grow in popularity, especially among new 401(k) asset allocation for t equit _______ y securities. At y _. “ContribuPercentage of recently hired participants holding balanced funds, 1998–2005 tion ear-end 2005, equi Behav his group. For exam ior of 401(k)ty securities— Plan Par ple, at ticipan yequity funds, the equit ts.” ear-end 2005, 8 ICI Perspective, percent of the account balances of Voly . 7, No portion of bal . 4, and EB aRI Issue nced funds, Brief, V printer anD Figure 2, Ave er ): Employee Sour hei ( ce:N Tab ov u Benefi latio emnrage Account Balances for A b s fr ter Research om 20 EBR 02—Ap I/IC Instit I Partu icip p te e and (EBRI) nt-D ix) irected R . , 212 1 K etirem Str ent eet NW, Sui ll Age Groups Exceed 1999 Levels in Plan Data Ct oe 600 llection , Washing Project. ton, DC 20037. 9. Full Names and 2005..................... Complete Mailing5 1,2 in their 30s hold 13 percent; participants in their 40s hold 33 percent; participants in their 50s hold 39 percent; and HEHS- 198-5. Washingtonfewer years of tenure, percentage of total, , DC, October 1997. 1998, 2004, and 2005 18 Among 401(k) plan participants who have had accounts since at least year-end 1999, the average account percentage of their account balance indicated in company stock, 1998–2005 13Addresses of Publi Equities inclu sher, E de equit dito y fun r, and ds, com Managing pany stoc Edi k, an tor d th (Do e equity not leav portio e bl n of ank): P balance ublisher, Employee d funds. Benefit Research Institute – Education and Research $54,591 and com No. 2p 3any 8 (Inv stock—represent about two-thirds (6 estment Company Institute and Employ 8 percent) of 401(k) plan ee Benefit Research Instituparticipants’ te, October 2001 assets. ). The largest recently hired participants in their 20s is hires: Recently hired 401(k) plan participants in their 20s current invested in company stock, compared wit ly hold a h 11 higher percent among that 53% The 50%EBRI/ICI data are based on administrative records from a variety of recordkeepers that cover a wide range of participants in 2 their 60s hold the remaining 14 percent of the total assets. Account Balances Rise With Age and Tenure Figure 3, More Than One-Third of 401(k) Participants Are in Their 20s or 30s or Have Short Job Fund, 2121 K Street NW, Suite 600, Washington, DC 20037. Editor, Dallas L. Salisbury, Employee Benefit Research Institute – Education and Participants include the 17.6 million 40 Contact EBRI 1(k) plan participa nts in Publications, (2 the year-end 200502) 659-0670; EBRI/ICI database. fax publication orders to (202) 775-6312. 32 U.Sbalance increased 50 percent in t . Internal Revenue Service. “Notice o he past six f Proposed >30 Years y R ears, ule M rising from aking, Certai $67,785 at n Cash or De year-end 1999 t ferred Arrangem oent $102,014 by s Under year- ________. “401(k) Plan Asset Allocation, Account Balances, and Loan Activity in 1999.” ICI Perspective, Vol. 7, No. 0–2 Years 23 age group i portion (48 3 n percent) of 401(k) plan 1998 (Figure 12). participants’ account balances is invested in equity funds, on average pl Research Fund, 21 an sizes (see percentage of their 401(k) accounts in lifesty Ap 21 K pe Street NW, Su ndix Figures ite A1 600, an Washing | d A2t)o. F n, DC or a m 20037 ore de . Manale, lifec tging Ed ailed desc itor |y , Ste c ri le, and other balanced funds than pt phe io n Blakely, Employe n of$4 th 9,e 37dat 4 aba e Bene se, see t fit Research he Appen Institu dite x. – Row percentages ma9 y not add to 100 percent because of rounding. % 48% Subscriptions to EBRI Issue Briefs are included as part of EBRI membership, or as part of a Th e ten The average den 25 Tenure cy of you ......................................................................................................................... account balance for 401(k) nger participants to favor equity fund plan particip s and o ants at y lder particip ear-en ants t d 20 o fav 05 is $ or fix 5e8 d,328. -income secu Half of the ................... rities 6 23.8% Employee Plans.” Federal Register. Vol. 46, No. 217 (November 10, 1981): 55544–55549. end 2005 (Fi 19, 20 gure 1). In 2005, the average account balance among this group of participants increased Education and Research Fund, 2121 K Street NW, Sui | te 600, Washington, DC 20037. 10. Ow | ner: Full Name: Employee Benefit Research Institute – 14 1, and EB46% RI Issue Brief, No. 230 (Investment Company Institute, January 2001 and Employee Benefit Research 12.8% 23.2% (Figure 6). Altogether, average asset allocations of 15.4% 401(k) plan participants are little changed in 2005 did their peers in 1998. $199 annual sub scription to EBRI Notes and EBRI Issue Briefs. Individual copies are available For research that examines how 401(k) assets might contribute to retirement income for future retirees, see results holds up e 44% ven when accounting for investment options of 22.7% fered by the 401(k) plan sponsor. The mix of investment Education and Research Fund. 11. Kn21.2% own Bondholders, Mortgagees, and Other Security Holders Owning or Holding 1 Percent or More of Total participants in the database have accou | nt balances less than $19,398 (the m 21.9% | edian account balance), while half >20–30 Years 21 1996 1999 2002 2004 2005 Utku 10 percent, due in part to s, Steph Institu en P. “Th te, February e qu 24.2% estio 2001). n of pos l itive equit oans.” Presen y market returns. The ted at 2005 US–UK D median ialogue account ba on Pensions lance (or , July 19–2 m 1, 20 idpoint, wit 05, in h half Figure 4, More Than Half of Participants With Small Accounts Are New to Their Jobs $41,335 .................... 7 26.2% >90% of Participant Account Balance from Amount 2004. of Bonds , Mortgages or Other Securi with prepa ties: None. yment 12. Tax for $25 each (fo Sta 7% tus (For13% completi r printed cop on by non ies) profi or for $7.50 (as an e-m t organizations authorizeda to iled mail ele atc no troni npro c file fit ) from the EBRI/ICI 401(k) Accumulat|ion Projection Model published i | n Holden and VanDerhei (July 2005, November Orders/ 29.8% option Plans Offering 401(k) Loans Are Co s, 45% particu40% larly th 21.3%e inclusion of company stoc mmon, but Loans Are Rarely T k and/or GICs and other stable value fund aken s, offered by a plan sponsor Lifestyle and Lifecycle hold more. Although manyFunds Gain Popularity observers wonder whether these accumulations will serve as a source of 33.0% Washington, DC: July 21, 2005. above and hal rates) The pur 10.5% pose, func f below) am tion, and no ong this c nprofit status onsis of this or tent grou ganization p also grew, m and the exempt status ore for f th ederal i an do ncome ublin tax p g between 199 urposes: Has not changed 9 and 2 during 005 to Ibbotson Ass • Company st ociates. SB ock as a pe BI (Stocks, Bon rcentage of 4 ds, Bills, and 01(k) plan a Inflation) 200 ssets co 6 Yearbntinued to fall in 2005: ook: Ma 38.1% rket Results for 1926–2005. by calling EBRI or from | 8.0% www.ebri.org. Change of Address: | 33 EBRI, 2121 K Street, NW, Suite >50%–90% of Participant Account Balance 2002As observed in prior Figure 5, Account Balances Increase Wi , and November 2002–Ap years, pend 14younger 401( ix). For addition th Age and T k) plan par al research referen tic eipants still tend to nure................................................................ ces, see Holden hold a higher porti and VanDerhei (Sep on tem of their ber 8 significantly affects the asset allocation of the participants in a plan. See Appendix Figures A21 to A23. Most 401(k) participants are in plans that offer borro 12% wing privileges. Indeed, research indicates that the preceding 12 months: 501(c)(3). 13. Publication’s name: EBRI Employee Benefit Research Institute EBRI Issue Brief. 14. Issue Date for Circulation Bibliography significant inco Lifestyle and me lifecy for retir cle funds have beco ees, such con | cerns fail to consider how me increasingly popular in recent y | aggregate account ears (Figure 9) as plan balances can prove 7.5% 6.2% 42.8% Chicago, IL: Ibbotson Associates, 2006. Utk$54, us, St 591. ephe 20% n P., and Jean A. Youn 600, Washingto g. Retirement Investor n, DC 20037, (202) 659-0670; Report Card for December fax number, (202) 775-6 2005: Returns Remai312; e-mail: n Positive, Recently hired 401(k) participants contributed to this trend; they are less likely to hold 24 34 2005 Data B ). elow: August 2006. 15. Extent and Nature of Circulation: a. Total Number of Copies: Average No. Copies Each Issue During Preceding 12 24 accounts in equity assets than older participants, who tend to invest more in fixed-income assets such as bond subscriptions 8.4% | | Brad presence of a y and Holden loan feature increases parti (July 2006) report th $30,at 002 lifecycle cipation and m $2u9tu ,77al 4 fund contributi s totaled on r $70 a tes in 401(k) billion at year-en plans. d 200 Yet the loan feature 5, an increase of 6.9% sponsors have acted to Figure 6, 401(k) Plan Assets Concentrated in Equi make retirement saving more convenient and easy ty Funds................................................................ for participants. Some plan 8 misleading. Publications Subscriptions@ebri.org. Membership Information: Inquiries regarding EBRI Activity Muted. Valley Forge, PA: The Vanguard Center for Retirement Research and The Vanguard Group, March 15 Inv Months: estm1,2 ent 7 Co 2; No. mp Copies of Singl any Institue te. Issue P Quaublished rterly Sup Near p est lemen to Filin ta g Da l Data te: 1. ,272 Wash . b. Paid ing and ton, DC: /or Requested Investm Circula entt Co ion (1) m Paid pany Institu /Requested Ou te. tside- The 401(k) account balances of these participants $27,526 have increased since 1999, generally because of Fixed-Income Agnew, Juliecom . “Pers pany onal sto ized c k and tend to hold lower Retirement Ad | vice and Mana concentrations of their ac ged Accounts:| Wh 5.7% o Uses Th counts in co em and H 39.3% ow D mo pany es A stock. dvice A ffect funds, GICs (guaranteed investm The Revenue Act of 1978 contained ent contracts), and ot a provision that becaher stable value funds, or me Internal Revenue Code §4 m01 oney (k). funds. The law On average, went i 3 nto 59 percent over the year, and lifestyle mutual funds totaled $97 billion at year-end 2005, up 67 percent from a year 40% 20% Investments also raise County Mails Subscr concerns that some plan participants iptions Stated on Form 3526 membership and/or contributions to EBRI-ERF : Average No. Copies Each might save and acc Issue During Preceding 12 um should be directed to EBRI President/ASEC ulat >2–5 Years Mon e ass ths: et 71 s only 2; No 5.8% . Copi to then acce es of Single Issue ss them 16.7% sponsors add Most im $24,371 portantl lifestyle or lif y, these aggregate averages are based on accounts held by ecycle funds to their plans’ investment line-up to provide an easy participants of var -to-understand ying ages __ 2006 ___. ___. “Redemption Activity of M | utual Fund Owners.” ICI Fund |amentals. Vol. 10. No. 1 (Investment Company contributions they and their 13.5 employers made and because of stock market appreciation since 2002. For Behavi Figure 7, or in 40401(k) Plan Asset Concentration in 1(k) Plans?” CRR Working Paper. No. 11.6 E 20 quities 06–9. C Decreases W hestnut Hill, MA: Cen ith Participant Age ter for Retirem .................... en Company Stock t Research 9 12.9 15.9% effect o Published Nea n Janrest uary to Filing 1, 1980 Date , bu : 71t it 2. (2) Paid was n In-Coun ot until ty S No ubscriptions S vember otf a t1 ed 981 on Form that 3526 propo ; Average No sed regu. Copi latioes E ns were issu ach Issue Duri ed (see Em ng Preceding 12 ploy ee earlparticipants in their 20s ier. Mottola and Utkus (Novem hold the bulk of ber 2005) repo their account rt that 63 perce s in equit nt of DC y pl se ans curities in 2005; 52 percent of their record6.6% kept by The Vanguard Group Chairman Dallas Salisbur 23% y at the above address, (202) 659-0670; e-mail: salisbury@ebri.org prior to retirement. However, as has bee | n the case for the 10 years | that the EBRI/ICI database has tracked and job tenures, and many and professionally m In • stitu Most 40 te, March 1(k) 2001 aparticipants nage ). d investm of these individuals are y approac ent choice for plan participants who can be overwhel hing retirement a ears away from ge do not ha retirement and have only just started ve a loan from me their d by the at Bo Months: ston 126 C ; No olleg . Copies of Sin e, March 200 gle Issue P 6. ublished Nearest to Filing Date: 126. (3) Sales Through Dealers and Carriers, Street Vendors, Counter example, contributions made toward the end of the bear market and invested in broad equity market funds 4 14.6% Benefit Research Institute (February 20 | 05) and U.S. Internal Revenue | Service (November 10, 1981)). Equity Funds offer lifecycle and/o12.4 r lifestyle funds; the paper also analyzes participants’ use of the funds, as well. Hewitt Associates Figure 8, Asset Allocation to Equities V 15% 25 aries Widely Among Participants 35.4% ......................................... 9 account balances are invested in equity funds, compared with about 38 percent of account balances for 401(k) Sales, and Othe plan p r a Nrticipants’ lo on-USPS Paid 19% Disan activity, relatively tribution: Average No. Copies Each few p Issue Duri articipants ng Precedi make use of bo ng 12 Months: 0; No rrowing priv . Copies of Single il Is eges. At y sue Published ear- ________. “401(k) Plan Particip 19% ants: Characte 10 ristics, Contributions, and Account Activity.” ICI Research Series complex array of choices or are too busy to actively manage the asset allocation of their 401(k) accounts on saving for ret 401(k) pla irement. Young workers or ns outstanding: Ninet those just starting o y percent of 401(k) plan participants in their 60s do n ut at their current jobs typically have small ot 16 Editorial Board: Dallas L. Salisbury, publisher; Steve Blakely, | editor. Any views expr | essed in this publication and those of the authors should 22 Agn have increase ew, Julie R., an d nearly 50 d Lisa R. Szyk percent in value. man. “Asset Allo cation and Information Overload: The Influence of Information Endnotes >10–20 Years 50.6% (2006), Nearest It i Fid s pos elity Inv to Fili sibl ng D e tate: estm hat0 t; ( h en 4 ese ) tOthe s (200 olr Cl de16% r 5), asses Mailed Throu loPro ngef r-tenured workers it Sharing gh the USP /401(k) S acc Cou : Aver um n age No c52.8% ula il otfed DC . Copies America Ea plan a ch Issue Durin (20 16% sset 05) also s, e. 16% g Pr g. d , ieceding 12 pos scus si s bl lifecycle/lifesty y Mon in a ths: profi 0; No. Copies t-shle ari ng Balanced participants in their 60s (F 26 igure 7). Participants in their 20s hold only about 20 percent of their accounts in 35% 15% | 64.5% | end 200 not be (In ascribed to the officers, ve 5, o stmn eln y t 19 Com percent of those eligi pany In trust stitu ees, te, Spring members, or b 20 le for loan other sponsors of the E 00). s have loans ou mployee Benefit Research tstanding (Figure 15). As i Institute, the EBRI Educ n previo 4 ation and us Figure 9, M 66.9% ore 401(k) Plans Offer Lifestyle, Lifecycle Funds 33.0% ............................................................ 11 their own. account balances because t 49.2% hey have not had the tim 49.3% e to accumulate significant balances. Funds have outstanding loans from their 401(k) plan. Among the 10 percent of participants in Display, Asset Choice, of Single Issue Published Nearest and In to Fi vest ling Da or te: Ex 0peri ; c. Tota ence.” l Paid and The/or Jo Requ urnal ested Circula of Behatvi ion o [S ral um of Fin 15b an. ce. (1), (2) Vo 13% ,l. 6 (3), and , No (4) . 2 ] Avera (200g5) e No. Copies : 57–70 13% 26% 8.4 funds. plan, prior to the introduction of 401(k) plan features. However, generally such DC plan 12% arra 35 ngem 42.0% ents did not permit | | 50.0% 7.5 1 Resear fixed-incom ch Fund, or e their securities (bo staffs. Nothinnd funds, GICs and other g herein is to be construed as an attem 11% stable value funds, and m pt to aid or hinder the adoption 11% of a oney ny pending le funds com gislat 11.2% b ion, ined), whi regulation,le 11% yEach ears, loan activit Issue During Preceding 12 y varies Mon with age, tenure, salary ths: 838; No. Copies of Single Issue , account balance, and plan siz Published Nearest to Filing Date: 838. d. Free Distribu e. Among 40 tion b 1(k) y Mail See Ceru Lusardlli Asso i, Annamaria, and ciates (200 Oliv 5). ia S. MitcheAbout the EBRI/ICI ll. “Finan 10% cial Literacy and Database 10% Planning: Imp 37.7% lications for Retirement Wellbeing.” 10% 6.4 25 Calculating Some plan sponsors are increasingly an average account balance blends the experiences of using lifecycle or lifestyle funds as default invest 17.6 million diverse 401(k) plan ment options in their 60s that do have a lo | an outstanding, the loans are sm | all relative to the participants’ Figure 10, More Recent Hires Hold Balanced Funds 9% ........................................................................... 11 Besh em ears, Joh ployee co n, Jam ntrib es J. Cho utions an i, Dav d oftein d Laib were de sonsi , and gned Bri to g be itte su C. Madrian pplemental. t “Th o ote h e Im r em po23 rpl tan oy cer pl e of Defau ans. The lt Op se part tionisc fo ipant r s’ or interpretative rule, or as legal, accounting, actuarial, o 8% r other such professional advice. For e (Samples, complim xample, Sethi entary, and -Iyenga o r, Huberm ther 31.3% free): (1) an, a Outside-Co nd Jiang unty as (2004) s Stated on ugg Form 3526 est that particip : Average No. ants can Copies Each feel o Issue During P verwhelme rd by eceding 12 too m Mon any ths: 2 27 7% 7% those in their 60s allocate 39 percent of their assets to these investments. Allocations to company stock participants nearing retirement age, only 10 Pensi The EBR on Resea I/IC rch C I Partic ounci ipant-Direc l Worki|ng P ted Retirement Plan aper. No. 2 percent 006have a loan o –1. Philad Data C elph | o ia, PA: ullec tstanding at tion ThProjec e Wh yarton ear-end 2 t is the larges Schoo 0l0 , Un 56% . t, mos iversity o t f 10 See Br automatic enrollm ady and % Holden ( ent program July 2006). s, which then also add such funds to the plan’s investment line-up. Lifestyle participants, 82; No. Copies oand y f Single o Issue Pu ung participants blished Nearest or those with short job tenure c to Filing Date: 82; (2) In-County as 5% Stated on onstitute a sizeable portion Form 3526: Average No. Copies Each 5% of the Issue During Retiremen rem t Sav aining account balances ings Outcomes: Evidence . from the United States.” NBER Working Paper. No. 12009. Cambridge, account balances that pre-date the 401(k) plan are not included in this analysis, which focuses on 401(k) balance invest ment options and Agnew and Szykman (2005) argue that participants experience “information ov4% erload 4% .” 4% In EBRI Issue Brief is registered in the U.S. Patent and T | rademark Office. ISSN: 0887 -13 | 7X/90 0887 -137X/90 $ .50+.50 36 Figure 11, Recently Hired Participants Now Hold Higher Concentrations in Balanced Funds........... 12 continue to be relatively similar across age groups. Participants in their 20s have a little more than 10 percent 3 rep Penn ressylv entati anv ia, e rep Pens oisito on Research ry of information Council, 2 about indi 006. vidual 401(k) plan participant accounts. As of Preceding 12 30% Months: 11; No. Copies of Single Issue Published Nearest to Filing Date: 11. (3) Other Classes Mailed Through the USPS: Average No. Among participants with outstanding loans at the end of 2005, the average unpaid balance is $6,82 5.5 1. Thparticipants in the EBRI/ICI database. funds m e Emploa yintain a predetermined risk level and genera ee Benefit Research Institute (EBRI) is a nonp More than one-th rolly use words such as “conservative,” “m fit, ird of part nonpartisan icipants at y , public policy research ear-end 2005 are in their 20s organo izatio derate,” or n, or am Mount A: Nat s. ional Bureau of Economic Research, February 2006. | | add ition, Investment Company Institute (Spring 2000) finds that 32 percent of nonparticipants indicated confusion over Copies Each Issue During Preceding 12 Months: 0; No. Copies of Single Issue P >5–10 Years ublished Nearest to Filing Date: 0. e. Free Distribution Outside the of their 401(k) plan account balances in co December 31, 2005, the EBRI/ICI database in 28.9% mpany cludes statistical information about stock as do participants in their 60s, while those in their : • About the EBRI/ICI 401(k) database: The EBRI/ICI Participant-Directed Retirement 17 Mitch Participants’ ell, Oliv loan activity ia S., Gary R. in 2005 m Mottola, Step | atc hen hes the trends noted in P. Utkus, and Takeshi Yam previous | aguch yiears: Loan balances a . “The Inattentive Particip s a percentag ant: Portfolie o Did Figure 12, Recently you read this as a Hired pass-alo Participants No ng? Stay aheaw Hold More Balanced d of employee benefit issues Fund Assets with your o ................................. wn subscription to EBRI 12 which “aggressive” in their nam does not lobby or take poe ss to indicate the fund’ itions on legislative proposals. s risk level. Lifecycle funds foll ow a predetermined 30s, and o Mail (Carriers of o ne-third have fiv ther means): Averae ge No. C or fewer y opies Each Issue Du ears of tenure (F ring Preceding 12 igure 3). T Months: he 0; No ma . Copi jority es o of f Single participants with an account Issue Published Nearest to Blo plan feat omberg Data ures was . New a “very Yo ”rk, NY: or “somBl ewhat oom” ber im 29.1% gport , L.P ant . reason for not participating in their employer’s 401(k) plan At year-end 2005, 64 percent of balanced mutual fund 27.4% assets were invested in equities (see Investment Company 3 2 2 Equity Funds2 Company Stock | Balanced Funds 2 Bond Funds | GICs and Other Stable Money Funds • 17.6 million 401(k) pl 19.3%an participants, in 4 40s have close to 14 Issue Brief Trading Befor havonl ior i y percent. n $89/ 401( yekar ) Pl electro ans.” n Pen icall sy io e n -maile Researc d to h C yoo u 17.6% uor $1 ncil Worki 99/year pr ng Pinted aper. No and mai . 200le 6–5 d. F . Ph or more i iladelpn hformatio ia, PA: Th n e Filing Date: 0. f. Total Free Distribution (Sum of 15d. And 15e.): Average No. Copies Each Issue During Preceding 12 Months: 16.7% 93; No. Copies of of account ba Plan Data Co lances (net of the unpaid loan balances) f 16.0%llection Project is the wo 15.8% 11.1 rld’s largest repository or participants with loans continue t of i 15.6% nformation about o hover around 13 Threallocation of risk over time to a specif e Investment Company Institute (ICI) is the ied target da national assote, and t ciation of th ypical e U.S. inv ly rebalance their portfoli estment company indu os to become stry. Its (mubalance les In ltip stitu le reason te, Qus arterly S s than $10,000 could bupp e gilem ven 10.3 e have been at their cu )n . Nev tal D ea rth ta). el 10.3 ess, Mitchell, rrent em Utkus, and ployers five Yang (Octob years or less er 2005) find (Figure 4). 2 that more choice Figure 13, Recently 1999 5 2000 Hired 401(k) Plan Participants 2001 2002 Are Less Likely 2003 12.1% to Hold Com 20 Value Funds 04 pany 2005 Stock .......... 13 Brady, Peter, and Sarah Holden. “The U.S. | Retirement Market, 2005.” IC | I Research Fundamentals. Vol. 15. No. 5. % 9.7% Single Issue Published Nearest to Filing Date: 93. g. Total Distribution (Sum of 15c. And 15f.): Average No. Copies Each Issue During Preceding 12 about subscri 377.4% ptions, visit our Web site at www.ebri.org or complete the form below and return it to EBRI. 8.9 Wha Am • ong individual participants, the allocation of rto47,256 e n School, m Uni plo vy ersi er-spo ty ofnsore Pennsy d 401 lvani(k) plan a, Pensio s, holdin n R account balances to equities (equit esearch g Council, 2006. y15 funds, company 25% 8.3 8.4 18 8.2 percent.individual 401(k) plan participant acco In addition, consistent with prev | ious years, unts, th and at ere is variatio year-end 2005 includes inform | n around this average: Older ation ex me pm and bershi s pap rtici incl patio udes n pro 8,71 v9 id o ep den th-e ere is nd inno vest t to m o m ent com uch co pani mp Investment Category elex s (“m ity in utu th ale cho fundi s”) ces. , 653 closed-end investment companies, m Months: ore conserv Second, since 401(k) 931; No. C ative and income-producing b opies of Single plans Issue Published were introduced relatively Nearest to Fili y the targ ng Date: et date. 931. h r . Cop ecently ies not Distributed (about 25 : Average years ago), No. Copies Each even older Issue During and Washington, DC: Investment Company Institute, July 2006. Unless otherwise indicated, all asset allocation averages are expressed as a dollar-weighted average. Source: Tabulations from EBRI/ICI Participant-Directed Retirement Plan Data Collection Project. Figure 14, Fewer New Participants Hold High Concentrations in Company Stock............................. 13 • $1.0 trillion in assets. | | 5.7 26 stock, and the Mitchell, Olivia equit S., Sty ep phe ortio n P. Ut n of balanced kus, and To funds) va ngxuan Yaries widely ng. “Turning aro Wo ur n kd ers the average of 68 into Savers? Incent percent for all ives, Liquidity, and Preceding 12 Name Months: 341; No. Copies of Single Issue Published Nearest to Filing Date: 341. i. Total (Sum of 15g. And 15h.): Average No. Copies 211 e 1participants, longer-tenured particip xchange-t 1998 raded fun 2004 ds, and five s 2005ponso ants, and participants with higher rs 1998 of unit in2004 vestment t2005 rusts. Its m 1998 utu account balances t al fund 2004 members m 2005 ae nag nd to have lower e assets of 19 for 17.6 million 401(k) plan participants’ accounts in 47,256 plans with more than In the EBRI/ICI database, lifestyle and lifecycle funds are included in the balanced fund category and See endnote longer-tenure Account balances 21, ared par whic em ticipa h s ploy nt u accou mmarizes the re ees could have pa nt balances held in 4search ind 01(k) p rticipated in a 401(k) lans at th icatin e particg ipan th ts' cur e bu rent lk of em plan f pl40 oyer 1(k s and o ) ar r, at m pe n articip et of p o lan an l st, about ts oans. do R no etiret ch half of t ment s ang avings e asset h hel eir career d s. Cerulli Asso Inv Source: Tabulations from EBRI/ICI Participant-Directed Retirement Plan Data Collection Project. estm cieates. “Retiremen n Source: Tabulations from EBRI/ICI Participant-Directed Retirement Plan Data Collection Project. t options are gro t Mark uped in ets to eigh 2005.” t categ Ceruories. Equ lli Quantita ity tive Upd funds ca ote ns . Bo ist of stop nool , MA: Ceru ed investlli Asso ments pri ciates, marilIn y i c., nvested in Each Issue During Preceding 12 Months: 1,272; No. Copies of Single Issue Published Nearest to Filing Date: 1,272. j. Percent Paid and/or Requested The 2005 EBRI/ICI database covers approximately 37 percent of the universe of 401(k) plan —20s— —40s— —60s— in plansC at hoi previ ce i ous e nm 40 ployer 1(k) s or Pl rollan ed over Desi into IR gnAs ar .” NBER Worki e not included. ng Paper. No. 11726. Cambridge, MA: National Bureau of Economic participants in the 2005 EBRI/ICI data 1 base. Indeed, 40 percent of participants have more than 80 percent of approximOrganiz ately $a 9tion .225 trillion (representing approximately 98 percent of all assets of U.S. mutual funds); th ese funds loan ratios. F Figure 15, Note: Components may not add to 100 percent because of rounding. o S r exam mall Percentage of Participan ple, for half of the participants in ts Take Loans fro their 60s that have a loan outstanding, m Their 401(k) Plans ............................. the loan am 14 ount allocation i Minor investment options are not shown; therefore percentages do not add to 100 percent. Percentages are dollar-weighted avera n a $1.0 trillion in assets. The ny given year. 2005 EBRI/ICI database covers approxim ges. ately 37 percent of Nevertheles there is an upward trend in Circulation: Avera s, on average, participants in their 60s wi ge No. Copies Eachbalanced fund investing Issue During Preceding 12 Months: am th m 90ong 401( %; No ore than 30 . Copies o k) plan participants. Toda f Single years of job tenure have Issue Published Nearest to Filing y, m accu ore than Date: mu 90% lated . 2 2005. stocks. These “funds” include equity mutual funds, bank collective trusts, life insurance separate accounts, and other Figure 2analyzes sample of 3.5 million participants with account balances at the end of each year from 1999 through 2005. participants, 11 percent of plans, and 42 percent of 401(k) plan assets. The EBRI/ICI project is unique Research, October 0 2005. Age Group 38 “Funds” include mutual funds, bank collective trusts, life insurance separate accounts, and any pooled investment product primarily invested in the security indicated. serve 27 their account balances invested in equiti approxim %ately 89.5 million shareholders ies, while 15 pe n more than 52.6rcent hold no equities at all in 2005 (Fi million households. 16 gure 8). Publication 20% of Statement of Ownership Publication: Will be printed in the Aug. 2006 issue of this publication. 16. Signature and Title of Editor, Address is less than 10 percent of their remaining account balance (Figure 16). Fo po the m 40 percent of r ex oled 3am o ire n pthe universe vest le substantial su , Del mrecently eo nt itte Co s. Sim of 401(k) plan participants, 11 percent hired participants hold n im l sa url of $180,988 in ltin y, b g o LLP, In nd fund te s a rnration t e any heir 401(k) abalanced l Foun pooled d a accounts at y ation ccou funds, com , and nt pri t of plans, and h m e In ari p elared with 29 ar-end 2005 (Figure 5). tern y invest ation e 42 percent o a dl iSo n b ciety of Em percent of new hires in 1998 onds, and f bal 401(k) pl oay nced ee Ben funds efit are Figure 16, Loans From 401(k) Plans Tend to Be Small....................................................................... 14 Choi, James J., Dav1998 id Laibson, B 1999 rigitte C. Mad 2000rian, and 2001 Andrew Met 2002 rick. “Savin 2003 g for Retire2004 ment on the Path of Least 2005 GICs are guaranteed investment contracts. Publisher, Busines because of its incl s Manager, or usion of data pr Owner: Dallas Salisbu ovided ry, ed by a wid itor; Employee e va Benefi riety of pl t Research an Institu reco te, pub rdke lisher; epers and, therefo Stephen Blakely, managing re, editor. Source: Tabulations from EBRI/ICI Participant-Directed Retirement Plan Data Collection Project. 1998 1999 2000 2001 2002 2003 2004 2005 28 Specialists (2 1 City/S 00ta6) te/Z report thIP at 3 8 percent of surveyed plans doing automatic enrollment used a lifestyle o r target po (Figure 10). Date: 08 oled acco /15/06. unt Not onl s invested i y are n bo m tho st re participants holdin ocks and bonds. Comp gany balanced stock is funds, m equity ino th re participants are co e plan’s sponsor (the em ncentrating ployer). Resistance.” Origina plan assets. lly prepared for Tax Policy and the Economy 2001. Updated draft July 19, 2004. Minor investment options are not shown; therefore, column percentages do not add to 100 percent. Source: Tabulations from EBRI/ICI Participant-Directed Retirement Plan Data Collection Project. portrays the activity of participants in 401(k) plans of varying sizes—from very large corporations to Source: Tabulations from EBRI/ICI Participant-Directed Retirement Plan Data Collection Project. I certify tha 2 t all information furnished on this form is true and complete: Alicia Willis, Communications Associate. Date: 08/15/2006. The analysis draws on samples of 1.2 million participants with two or fewer years of tenure in 1998, 1.8 million participants Note: The analysis includes 401(k) plan participants with two or fewer years of tenure in the year indicated and in a plan offe with two or fewer years of tenure in 2004, and 2.2 ring company stock as an Mail to: EBRI, 2121 K Street, NW, Suite 600, Washington, DC 20037 or Fax to: (202) 775-6312 small b Note: u The analysis in sinesses cludes participants with two or fewer years of tenure in the year indicated. —with a variety of investment options. investment option. million participants with two or fewer years of tenure in 2005. 3 Fixed-income investments include bond funds, guaranteed investment contracts (GICs) and other stable value funds, and money fu EBRI EBRI Iss Issu ue B e Br rief No. ief No. 296 296 • • Au Augu gust 20 st 2006 06 • • www.eb © 2006 EBRI ri.org • www.ebri.org nds. For a detailed breakdown see EBRI EBRI EBRI EBRI EBRI EBRI EBRI EBRI EBRI EBRI EBRI Iss Iss Iss Issu u u uIss Iss Iss Iss Iss Iss Iss e B e B e B e B u u u u u u ur r r r e B e B e B e B e B e B e B ief No. ief No. ief No. ief No. r r r r r r rief No. ief No. ief No. ief No. ief No. ief No. ief No. 296 296 296 296 296 296 296 296 296 296 296 • • • • Au Au Au Au • • • • • • • gu gu gu gu Au Au Au Au Au Au Au st 20 st 20 st 20 st 20 gu gu gu gu gu gu gust 20 st 20 st 20 st 20 st 20 st 20 st 20 06 06 06 06 • • • • 06 06 06 06 06 06 06 www.eb www.eb www.eb www.eb • • • • • • • www.eb www.eb www.eb www.eb www.eb www.eb www.eb ri.org ri.org ri.org ri.org ri.org ri.org ri.org ri.org ri.org ri.org ri.org © 2006, Employee Benefit Research Institute -Education and Research Fund. All rights reserved. Appendix Figure A32. EBRI Issue Brief No. 296 • August 2006 • www.ebri.org 4 EBRI Issue Brief No. 296 • August 2006 • www.ebri.org EBRI Issue Brief No. 296 • August 2006 • www.ebri.org EBRI Issue Brief No. 296 • August 2006 • www.ebri.org EBRI Issue Brief No. 296 • August 2006 • www.ebri.org 12 15 10 19 13 16 18 14 11 17 2 5 3 7 6 8 9 “Funds” include mutual funds, bank collective trusts, life insurance separate accounts, and any pooled investment product primarily invested in the security indicated. 0–2 >2–5 >5–10 >10–20 >20–30 >30

Volume 296

Pages 20

EBRI Issue Brief

Sarah Holden

Jack VanDerhei

Retirement