Since 1996, the Employee Benefit Research Institute (EBRI) and the Investment Company Institute (ICI) have worked together on collecting and analyzing annual data on millions of 401(k) plan participants’ accounts. This report reflects the year-end 2018 update of these data and EBRI and ICI’s ongoing research into 401(k) plan participants’ activity.

Key Findings:

• The bulk of 401(k) assets were invested in stocks. On average, at year-end 2018, 63 percent of 401(k) participants’ assets were invested in equity securities through equity funds, the equity portion of balanced funds, and company stock. Twenty-eight percent of assets were in fixed-income securities such as stable-value investments, bond funds, money funds, and the fixed-income portion of balanced funds.
• More 401(k) plan participants held equities at year-end 2018 than before the financial market crisis (year-end 2007), and most had the majority of their accounts invested in equities. For example, about three-quarters of participants in their twenties had more than 80 percent of their 401(k) plan accounts invested in equities at year-end 2018, up from less than half of participants in their twenties at year-end 2007. Overall, more than 90 percent of 401(k) participants had at least some investment in equities at year-end 2018.
• More than three-quarters of 401(k) plans, covering more than three-quarters of 401(k) plan participants, included target-date funds in their investment lineup at year-end 2018. At year-end 2018, 27 percent of the assets in the EBRI/ICI 401(k) database were invested in target-date funds and more than half of 401(k) participants in the database held target-date funds. Also known as lifecycle funds, these funds are designed to offer a diversified portfolio that automatically rebalances to be more focused on income over time.
• 401(k) participants’ investment in company stock continued at historically low levels. Five percent of 401(k) assets were invested in company stock at year-end 2018, in line with recent years. This share has fallen by 74 percent since 1999 when company stock accounted for 19 percent of assets.
• A minority of 401(k) participants had loans outstanding. At year-end 2018, 19 percent of all 401(k) participants who were eligible for loans had loans outstanding against their 401(k) plan accounts, unchanged since 2016. Loans outstanding amounted to 10 percent of the remaining account balance, on average, at year-end 2018, up 1 percentage point from year-end 2017 but still below their historical average. Loan amounts also edged up a bit in 2018.
• The year-end 2018 average 401(k) plan account balance in the database was 5.9 percent lower than the year before. This is consistent with stock market declines in 2018 but may not accurately reflect the experience of typical 401(k) participants. Among consistent participants in the EBRI/ICI database between 2010 and 2018, the average account balance was 0.7 percent lower at year-end 2018 than at year-end 2017. Changes in a participant’s account balance are primarily due to the combination of contributions, investment returns, and withdrawal and loan activity.
• The average 401(k) plan account balance tends to increase with participant age and tenure. For example, at year-end 2018, participants in their forties with more than two to five years of tenure had an average 401(k) plan account balance of about $36,000, compared with an average 401(k) plan account balance of more than $306,000 among participants in their sixties with more than 30 years of tenure.

Figure 7 F Fiig gu ur re e 2 23 6 F F F Fiiiig g g gu u u urr r re e e e 1 2 1 10 0 6 2 F Fiig gu u rr ee 2 3 4 401(k) Loan Balan Dc oe m se a sts ic a S P to ecrk c e an nd ta B go en o df M 4a 0r1 k(ek t )I n Pd la ex ne A s ccount Balances 401(k) Loan Balances Asset Allocat D io is nt rD ib is uttr io ibn u o tio f 4 n0 o 1f( k 4)0 P 1l(a kn ) P Aa crc tio cu ip na t n B t a A la cn cc oe us n t b B y a Slia zn ec o ef tA oc B ca olu an ntc B ed a lF an uc ne ds by Tenure DistT rie bn uu tiro en C o ofm 40 p1 o(s ki)t iP oln a n os f ,S P ea le rtc ic te ip da 4 n0 ts 1,( k a)n P dl a An s s Ae ctc so b u yn Itn B ve as la tn m c ee n C t O atp etg io on rs ie, s 2 018 Few 401(k) Participants Had Outstanding 401(k) Loans; Loans Tended to Be Small 401(k) Plan Characteristics by Plan Assets, 2018 1 Figure 14 for Participants With 401(k) Loans by Plan Size, 2018 Month-end level, December 2007 to December 2020 Average and median loan balance1 s for 401(k) Percentage of participants with account balances in specified ranges, 2018 Percentage of participants with acco Figu un re t b 6 alances in specified ranges, 2018 Changes in Concentrations in Equ ities Sinc Pee rce the nt Financ ag Se e lo efct ial pe a Cri d rt iy ci se is p a a r ................................ s nts, 2018 .......................................... 21 D Age Ho Russ U. D Ref the Year partici Fi Asse U. g efini ist S. S. ld ure past en, and Te ell ri De De ere t A pan bu - 22, ti partm partm 2 Sarah End the on o ll 2 000 I n ti ts 3 ocat Per on ces , t ye enure of 4 ent ent xperien he f 401 2018 centag , and Jack nd of 401 ars ion t e as , among of of x. s Labor, Labor, et siz (k) Pla T e o Equi cacom e Sna (k ofof 01 Eli Van ) Pa e f p typica a Em Em (k) pshot of a gi or many n Account ti , WA: Fra Derhe rticipants ble rt es pl pl Plan ici oy oy l 40 4 ee Ben ee Ben pants’ Balanced i. 0 1(k 1(k 2 pl Par nk R 001a with ans )) P 40 p B efi efi ti articipants i uss artici alance . “ l cipa sts ts 1(k) oans mod Contri S S ell pan ecurity ecurity nts Com outst est Par ts bu With . .pa tio Fu T Am an Administra Administra wen n ticipants’ Asset ny. di nd Al B ong 4 ng 01 ty eh con - ,(avior a sk) iloca x bout Loan s pe tion tion ist of rc ti ent 13 . 2 . 2 401(k ent ons b s b 0 0 pe partic y Pl 19 12d. of rc the .) y ent an Size, P Private Age ipa Pr All lan pla ivate Pe onts P f ocatio tns ha ar h P i 2 e n ticipants.” ension 0remai t18 he nsion ve ................................ n E as P B nin s RI/ICI lPlan an Bulleti ets g Inv a of B cco est d ullet $250,0 ata unt balanc ment Com n, in, ba A Ab s00 bstr e be sor less t ........ act of ract e p twee any of 24 , n Investment Options Offered by 4 0 P1 la (n k) Plan Assets F A Firig e gu C u P re r lo a e n n 2 s c 9 8e ntrated P a in rt iE ciq pu an ittis es Assets Sarah Hol Abode ut the n is Senior EBRI/ICI D Director of Retirem atabas ent an e d Investor Research at the Investment Company Institute (ICI). Jack 401(k) Plan Asset Allocation, Account Balances, and Loan participants with 401(k) loans, 1998–2018 14 29 1 401(k) Participants Represent a Range of Job Tenures Equity, bond, money, and/or balanced funds 61,810 4,023,800 $258,256,864,299 2015c, Ot Foher s r the a 2016, 2018a table ge distri -value f butio , 2018b, 2 unds i n of 401 nclude sy 019, an (k) plan pa Lnt d oa hetic GICs, 202 ns1 rtic a F.r ipants a o U.m S whic . Departmen 401 nd h co (kass ) P nsist of a portfol ets at y lat o ns To f L Tabor t e ear an l d -e e 2021a nd d io 2018 to of fixed reports that the Be , see Fi Sm -inco algu l me secu re 5.re were rities about 588,500 “w Arappe verage d” wi Ath a c401(k) cou nt and remaine a 20 Inst 20 nother 1 07 Form 8 Form d unpa itute P 201 0 33 a ers id nd 201 5500 5500 p. U ercent pective .SA A . 8, nnu nnu De h the 7, av pa al ale no. rtm avera R Re pelan 4, and p p ent ort ort ge as of s s s account ( ( Lab ets Version Version EBRI be or d Iss tw b ata 1.0). Was 1.2). Was een al ue i an $250 n Br di ce w ief cat ,,001 an n hin hin as e o. that 0 g g.7 ton, DC: ton, DC: 238 l pe d $1,2 oan (Oct rcent lo am ob U. U. 50 ounts S. S. er) ,0 wer 00 ( Dep Dep . Av ten at y Fi artm artm ailab g d ur ear to ent ent le e - at be 3 en ). o o a d 20 f fw Labor, Em Labor, Em negli ww 18 than .ici.or gibleg/pd p pl p at lo ort oyee B yee B year f/p ion er of -07 end 2017. ene ene p -0 lfits fits a 4.p n df VanDerhei is Director o4 f Re 01(k) search at plan ave the rag eEm asse ploy t aee Ben llocatioefi n, t pe Researc rcentagh e I onst f toitute (EBRI tal assets, ) se . Steven Bas lected yearss is an economist at Allin At year 340 g, B -end rian T 201 ., Jeff 8, 39 rey W. C percent of lark, an 401(k d Dav ) p Pelian rd ce Sti pa ntnnett. articip ge ofant 2 A0 cs 20 c’ ou acco . nt Ho B unt w alAm a b nc aer e lances w ica Saves Invested ere in 202 i B naves 0 la. V nc ted a elley For d in Fue nd qu sg ity e, P fun A: ds, on The V a average, nguard Distribution of 401(k) Participants’ Balanced Fund Alloc Fiations gure 4 by Age .................................................................. 22 Snapshot of Year-End 401(k) Plan Account Balances Activity in 2018 Years of Tenure 1 41.8% S& Fi gP ure 500 38 23 . Ne , 4 01( O wf York: Sta P w k) e hr Loan ic ce hn : tta ag rg Balan e nd e o t-far d E ad tces le ig& ifb u P as a Perce ln ed oor 4 s0 1 ’s. a(rk e ) a P na ntage o rtp ic tiio pn a of nts 401(k)4 P 7,lan 688Account Bal 3,18 a4nces ,606 for Partici $1pan 95,5ts 39 ,W 96ith 4,04 91 01(k) Loans by The EBRI/ICI ParP ticipa erce ntn -tDir agected e of a R ct etir ive em 4ent 01(k) Plan Data plan paCollection rticipants Pb roj y ect yeagat rs o hers f te n inf ur orm e, 2 ation a 018 bout individual gua plans in 2 rantee (typi 018. Pla call n A y by sse an ts insurance compan Tota yl 1% or a ban Plans k) to provide benef Participantit paymen s ts To acco talrding to Assets the plan at boo Balk v anc alue. e assets and Security A Security A . Changes www.e dmi dmi bri. inistr nistr norg/cont a partici ation (Ma ation (Se ent/c pan Pe p rch) t’s rontributio Y tember) cen ea a. Available rcco tagunt balanc e . Avail A o n v- f e be re alg at ihavior abl e g iLb ww o e e la e at n are p - w.d O of a u p r- tt s 4 ol. ir tci 01 a imarily n g p d ( ov a ik) nn g /sites - ts pl d b an M u y 3% ee /d - d p partic ito t a a ol nr go tL ihe ci ov/fil a ipan p n co a On es u mbination ts tt s a /e -t1 a gbsa/re n 54 e d,i n . 2 g 01 of s8 earchers contributio /statns, istics inves /retireme tment nt- Indi As The data Am 32 a 0ong vicro duial s nd base s 401 sec ividtion, or sna ual ( includes k) p 4articipa 01( 401(k k) pla ps nts hot, of n )’ p part as artici set all icip the pan a e ocat nts ts nt, the ire acro ion pop al to sslocatio a u bal lation wi ance de n of of range d f ac 4 und 01 count of (sk) varie age a p b lan a dlances to p w nd artic i t de enur ly ip aroun ants e e gro quit , td up he database ies (equ an s. At ye avera ity f ar geun - includ e of nd ds, com 31 2018 es 4 perce , pan 01 48 nt (y kp sto at )ercent ck, ICI. This 30 in line with Group, Is re sVa ue cent years ngu Brie ard f was Center (writ Figu f ten re or R 14 with as etir 3% ). Alto ement sist geance ther, Research. Avai equity from th securiti e In labl stitute e es at — ’s res equity earch a 1 fund nd e s, the ditorial staffs. equity2 porti An on of y views balance expre d ssed EBRI/ICI 401(k) Database Represents a Wide Cross Section of the 401(k) Universe See note 11 for additional detail on target-date funds. With Outstanding 401(k) Loans Year >3 2 -0En 007d 20 Eq1 u8 itySn , bo apshot nd, mo o nef 401 4 y,0 a1 n( d (k) k) /or P p blla aa la n n n Lo c p ea d an rftuin ci Act dp s;ivity a nt ................................ account balances, ................................ selected years ............................. 23 Years 2 5 of % Plan Size, Tenure Z 201 ero 8 ................................ >0 to 101998 >10 to 20 >20................................ to 3 $0 6,7> 13 70 to 40 >40 to ................................ 50 >5$ 03 t ,9 o 06 20 > A 6g 0e t o gro 7u 0p................................ >70 to 8013% >80 to 90 >9....... 0 to 1 0 25 0 $ 30 0 0 to 40 26 $ 1(k 250 ) plan p ,000 articipant accounts. As of 24 D ,0 e8 cember 2 31, 201 18 84 , t ,6 he 07EBRI/ICI data $2,base 310,3in 1clud 9,94e 8d statistical $12,515 By Sarah Holden, ICI; Jack VanDerhei, EBRI; and Steven Bass, ICI year of and partici pa t ww bu -rticip en he eq pan llet d w.d returns 2018 ts ins/ ants uity ol. wpriva gov/ ho are w p (, an Fi ort er g s te e ure ites/dolg ion d w - youn in p of ension th 14 ithd b eir t )g and . a ra F ov lanced - or exam wal hirties or pl /fa iltn es/ebsa a hos -nd f bu ull e wh pl nd loan f eti e, ort s/re ) ns o are ne 35 ivar activ es, -sa ea p b ies widely w ercent srchers ity. trac hile 14 w t-to t of 2008.p /stat part p heir around ercent isticip d ic jo fs . bs, /retireme of the ants as parti 10% av h well el erage cipan d nt no as -b b o of ull tsa ld etins lance were 63 er pa pe /p in the drticipants rcent f rivat unds, e ir for al -p twhi wen ension and l pa le ti e 46 thos - s rticipants pl , 2 pe ae 5 nrc -who pe bent ull rceti h in ent oav ns f thwere e -e been in 15 3 this report are those of the authors, and should not be ascribed to the officers, trustees, or other sponsors of EBRI, fun ds, https: 2008 and //inst company sto itutional.vang ck — uar repr d.com/n esente gid am 63 /as pe sets rcent /pdf/has of 401 /h (k) ow p-lameri an partici ca-span aves ts -report ’ assets -2 at 020. year pdf-.end 2018 (Figure 15). 2 11% S S ee In ome reco vestme rdke nt Company epers supplyi Institute ng data 202 were u 1.. nable to provide complete asset allocation detail on certain pooled asset classes 401(k) plan character istics by number of participants: EBRI/ICI 401(k) database in 2018 U. S. Departm and ent GICs of Labor, and/or o tBureau her sta 1999 b of le-v Lab alue or Statis funds tics $6,8. 2012. 15 2 7N ,5ational 67 Com 6 $ pe ,4 6,5 4 nsat 8 0,027ion 8 Survey$:4 Empl 70,120 oy ,0ee 36,7 B7 ene 6 fits in Mar31 ch 4, 0 to 2 2021 • No. 36.8%526 2.0 % 1.5% 1.3%> 30 y0 e.a 9r % s 0.9% 1.1% 0.6% 0.8% 0.7% 53.3% 401 >(2 k0 ) L to o a 3n 0 as aL P oa en rc a en s ta ag P ee o rfc R en etm ag ae in io nfg t h 4e 01 R (k e)m Aa cic no in ug nt Ho $ 28 2S 0ld 5 ee Figure A9 0 en, ,00 Sarah 0 to $, and Jack 62 in the 5,000appendi Van 34Derhe x. i. 2001b 15 . “ ,4 T0 he 4 Impact F F iig of gu u rEm r e 2 e 3 2 pl 2 1 1,oy 83e 3r-Selected I$ nves 6,44tm 7,7 ent 12,O 5ptions 16 on 401(k $2) 7 P ,6la 92 n Aveinf 2ra 01orm g 0e ation about: Availability and Use of 401(k) Plan Loans by Plan Size ........................................................................................ 23 abstract-2017.pdf. 20 in partici with 1 th 8eir fifti t datab heir pan curr tse as held s, e ent and (Fi more t gu em 13 re pl p oy 15 ercen han ers ). 8 f t we 0 Forty or ma percent re -fo ny yea in ur th of pe eir the rs r sixties ( cent of . T irhese accou part an Fig nts u nici re ual ipan n balanc 5, up upd ts h at pe aes of d r ed pan mo funds at the rel). The me e than data the 80 base e pe di nd rc provide an ent ofag 2e of 018 snaps o the f th (Fi ir e p gac hots ure articipants count 19 of) . At y 40 bal 1(k anc ie n )ar p e the s la -en n d EBRI-ERF, or their staffs. Neither EB1RI nor EBRI-ERF lobbies or takes positions on specific policy proposals. EBRI invites 2000 $6,856 $3,824 for one or more of their cl 401(k) Planients. The Account Bfina alanl E ceBRI/ICI 401(k) databa 4% se includes only plans for which at least 90 percent of all plan >2 to 5 Of wh3 ic 5h .7 : % target-2 d.a 8t% e funds 2 v.s. 1 a% r2 e 0 an 1 8 op 2D t.i0 oO % n L For1m .6 % 5 25 20 ,70 62 1 fo .5r% all 40 4 1 1 ,.9 4 (3 k) % 2, 6 p5la 3n1 s.0% $35 10 .2 ,4 % 00,5231 ,7 .3 1% 3 49.5% Balan 20 ce 11 20s 30s 40s 50s 60s $78,267 All 4 Figure Private I 24, Fend w ust 401 ry in (k) P tarti he Un cipan ite> d ts 2 Ha Stat 0 tod es, 3O 0 Marc uts yea tanding rsh 2012 401( . Was k) Loans hington, ; Loans DC: U. TS. end De ed partme to Be Small nt of La ................................ bor, Bureau of Labor.. 26 Percentage of 401(k) Plans Offering Loans by Plan Size, 2018 260 >10 to 20 21% 21% 21% U. $ Th 6 S. 2e Emplo 5 • Participa De , 00 partm 0 The aver to yee nts $ ent 1 Benef ,’ 2A of 5s age 0 Labor, s,et All 0 it R 0 0 40 esea ocat 1( Em rch In k) p ion ploy sla : Prel stitute ( ee Ben n account ba imiefi 1 EB nary 4ts ,RI) 2 S 3 is a nonprofit, Fi 9 ecurity nla dince ngs.” Administra ten Wo d nonpa 3 rking pap s 11 to ,9 tion increa 7rtisan, publi 4. 2 er 0pr 12 se ep e. wi are Privat c po $ th p 1 d for th 2li ,cy 9 ar e 1 resea Pe 5 ti,cipant 8 e nsion 0 Ce 3rch orga ,6 nte 1 Plan age an 1r for B niza P ullet ed tio nsion an in, te n th $ Ab 4 n1 ure. at d ,s 4td 0 ract oes not 0 For of 0$ t7 o6 2 ,2 y 9e 3a rs Bloomberg Barclays 40 Cap 1(k) ita P l U la.n S. C Agg ha reg raat ce te Bon risd tiIc ndex. s by N N ew Yor umb ke : r B lo oom f Pbe larg n L.P Pa . r ticipants, 2018 32 2001 $6,644 $3,659 $75,358 20 acco invest C 20 ha 1 18 8 2 unt balan nges in , 0datab ed 65 13 i pe n e as rc qe ent Asse ces uities, is , ass 46 oft A 401(k whi yet all ears lllocat e ) , le o s partici cation, an similar s ion Bet than pan to 10 prior ts d loan activity wee held per years cent h n Year bala . B eld no nce -ecaus E acr d nd f equities und os e 2017 sold w s th id er roug e at and Y cros partici al h t l sa sections arget ear pan t the en ts -End - te date nd to of d 20 fu of pa nd 18 2have l rticipants. 01 s and 8 (Fi ar gu non gere Ho r ac - t17 arget wever, count ). Youn -date the bal ge b anc cro ra 401(k le anced sss, - ) com >5 to ment on 10 this researc 36.1% h.3 .8% 3.0% 2.7% 2.1% 1.9% 1.8% 1.4% 1.6% 1.8% 43.7% For an an Ealysi quitys track , bond,ing targ money, et an -d date f /or bau la nd u nced s e an funds d the ; persistence of their use from 2007 through 2009, see Copeland 2011. as Zesets could be i r40 o (1(k no l) o P anla ) n Lo dentified. an Activity Varies With 9% Participant Age, Te 92%nure, and Acc 81% ount Ba 75% lance ................................ 77% 86% ............ $7 81% 3,67 25 2 20% $73,357 15% Statistics. Available at www.bls.gov/ncs/ebs/benefits/2012/ebbl0050.pdf. 240 $72,383 20% 201 •5 14.6 million 401(k) plan participants, in 23% lo $1 bby > ,2 55 tor t 0 o ,1 00 ak 00e posi to $2 ti,ons o 500,0 n legisl 00 ative proposals. 14,1 04 499,411 $25,128,948,428 $50,317 U. Introduc S. 20 Retireme De 1partm 0 Form example, tio nt R ent 5500 n of e at s Labor, earch (CPRR) yAear nnu -e al Em nd Rpl e 2018 p oy 2002 ort Cu ee Ben 35 ,s p rre (artic Version nt P efi ip ensi ts ants S 1.0). Was on Poli ecurity in the $6,65cy 9Administra ir Iss hin fort g ues Conf ton, DC: ies with tion erenc mo . U. 202 S. re $ e Dep 1 3 th , at ,a 7a . 0n 0 Privat artm Miami twoent to five y e Uni Pe ofnsion Labor, Em vers ears ity, Plan Ox of B t for pl ullet enur od, yee B in, OH e h Ab , Ju ene ads tan ne fits ract 8 of –9, >10 t2 o0 2% 0 40.7% 6.5% 5.0% 4.3% 2.9% 2.3% 2.0% 1.6% 1.9% 2.5% 30.3% >0 to 10 pea rc ne dn c t ompany stock 19% 2% 530 5% 1,722,39% 73 11% $13 19% 8,613,89 19% 37% ,936 19% 7% s fun as pl ectional a an sets ds, partic i similar n the ip nal a data nts ys to the is is not well w base ar ers e hmuc are e in m h suited ore mo 2017 re he l . to a avily ikely Mor dd co te o have ress ncentrate than ing h h th alf igh c e que ( d 56 am oncentrat pong sercent) tion of the ions of tol he im de 401 in r 40 e pact of (qu k) 1(k p itiarticipa es. ) p part a At rticip ici year nts pati ant g h -en eld tar on d ro in 40 2018 upge s. At 1(k , t-about date fun year ) plans over -thre end ds, e2 -018 qu time. arters , For an analysis of target-date fund use among defaulted and non-defaulted 401(k) plan participants, see Mitchell and Utkus Figure 20 125 6 , 401(k) Loan Activity Varied Across 401(k) Plan Participants ..................................................................... 26 31% 16 220 2003 $6,839 $3,832 $2Av ,50 erage 0 •, 090 00 Loan ,9 18% t87 o $ emp 6Balances ,2 18% 5lo 0,yer 000 - s ................................ ponsored 1 401(k 18% 12 ) p ,4lans, 21................................ 18% holding 858,262 ................................ $48,36 18% 4,077,................................ 439 $56,351.... 25 Bloomber The avera g Da ge a ta. N ccoun ew Yor t balan k: ce is calc Bloomber ulated f g L.P. or t he 1.9 million 401(k) plan participants who had account balances in every >2> 0 220 20 Security A t o t o 3 1 0 0 5 1. 8 Form average dmi 5500 401(k 4nistr 5.1% Aation (N nnu ) plan 9 al .1 R account %e ov pember). Av ort6 s. 3 b (% Version alance ail 5 of .abl 1.0). Was 3% a eb at out $ 3.hin 4 36 %g ,0 ton, DC: 00,2 c .8 om % pared w U.S. 2Dep .3% ith a artm n ent 2 avera .0% of Labor, Em ge 40 2.4 1(k % ) p pllan o2yee B . acco 9% ene unt fits 18.2% >10 t2o 0 1 27 0 percent $65,454 2% 4% 6% 5% 3% 4% 5 Over the p as O t ffour whic h de : tca arg de ets -d , a40 te 1(k fund )s plans h are an ave bec option ome the mo 281st widesprea 1,3d 22private ,456 -sector emplo $110,051yer ,61- 2s ,8 ponsor 42 ed Plan Assets of Cros 11 63 4pe pe 01 s sections rc rc (k) ent ent pla o hel f 401 n p change d artic no (k) n-ip plan as tar i ants n c geto in the -mpos dsate b ets w ir ition fro aere tlance wen hti e d f m year to e ld by sund had partici s more t , a yea nd 2 pan r b hpan tercent s ec i8 n ause t 0th pe 3 h eir fifti rc el he s d bo ent election eof s th. T or the sar ixties, ir ge o acco f da t-dat w u ta p nt b hil e e 13 frov und use alances ide prs ercen a var in nd ves t of 40 sam ies wi ted pl ti1(k h partici n e of e)qu p pl la ities, ans n pan t 2012. Changes Sug The In ges ves te ind ci tme assta nt et all ti Co ompan ocat n: Ho ion y Insti ld e ov n, er time tute (ICI) Sarah, refle Jack is t ct invest V he lead anDerh ing ass ment ei, a nd pe $ oc 6 St 3 iati rform ,9even on represen 29 ance, Bass partici , “ ting regulate 401( pan k)ts P’ la rn eb d fu As ala snds et All ncin glo g, ocat bally, and ion, Account cha inclnges uding mutual in the Russell 2000 Index U.S. Department of Labor,17% Bureau 2004 of Labor Statistics $6,9. 2013. 46 National Com$ pe 3,8 nsat 93 ion Survey: Employee Benefits in the 401 200 (k) Plan Asset Allocation, Account Balances, and Loan 2018 $ >6 30 ,250,000 to $14 28,.5 80 % 0,001 0 0.1% 6.4% 4,75 7 .1 3% 3.5% 7222 ,.2 82 % 8 2.3% $41,1 6.8 7% 7,467,4 15 .6 0 % 1.5%$57,72 11 6.0% yea >20r between year to • 3 0$1 pe.1 rc etrillio nt -end n in as 2010 sets and y . ear- 1end 2018. 1% 3% 3% 3% 1% 2% 0 to 2 Equity, bond, money, and/or balanced funds; ww Security A w.d bal P ol. anc ergov/ cdmi e enof ta nistr s mo g ite es/dolg o ation (Jan re tha f plan ov n a/f s $s i306 luary) es/ebsa ets,00 . Available at 0 amon /reseag pa rchers $60rticipants ,32 /stat 9 istic in s/retireme their sixtint es w -bull ith etins more t 20 /privat han 30 e-pension years of -pla ten n-bu ull re. eti ns- Num16% ber of Plan 16% Total 94% Average Account Refe retireme rences nt pla ................................ n in the United Stat................................ es. In 2018, an estim................................ ated 59 million America ................................ n workers wer 93% e activ .......................... e 401(k) plan 29 Figure 26, 401(k) Loan Balances ................................ 2005 $6,821 ................................ $3,6................................ 61 ........................... 27 Balances, age and com using a giv as fu EBRI/ICI nds, exchan sets pare w ten ere d wit cros and en held ur g h s provider e. You e Lo section o 1 -traded funds b 4 perce an y Act ng partici vary er ivity nt f pla pa p o in 2 ants and rticipants f ns in (E 401 TFs), 01 i be n (t8 k) ca he data t, c heir ” p use lo E wer lan partici BRI sed t4 wen e 01 base. - Iss end slightly (ti k) ue es or t funds, and p pan His Br artici mo ief tor tsh in ,ic r ir pa no e ties ( t ally, i nts li heir un . 5 ke join ly to 26 it i Fi sixties. nves g , an nv ure or estmen hold tm d 5, lower lea e IC nt perform targe ve p I R t trusts (U esear la t p -ns. d an ate cel). anc h ITs In P fu er e a Participa nd ) in s like dd p sective tha the United S itio ly e n, n xp nts , ol th la vo de i e da in ns a l.r 4 p 27 0 ttabas artic ates, an 1(k 92% , good dea no. )ip p e ants 2 lans co d simi (Mar nt . l ain At of ch lar the s 180 16% United States, March 2013. Washington, DC: U.S. Department of Lab 91% or, Bureau of Labor Statistics. Available at 33 2 Brady, All Peter, and3 M 5.ichae 1% l B 4.ogd 4% an. 201 3.2% 0. “A Loo 2.8% k at Pri2 vat .0% e-Secto 1.r 7 Ret % irement 1.6% Plan1 In .2% come Af 1.ter 4% ERISA 1.6 .” %Investm 44.ent 8% $ >1 30 2 ,t5 o 0 80 0, 0 pe 0r0 c etn ot $25,000,000 2,469 3% 736,465 6% $ 6% 42,745,872 4% ,928 2% $58,042 5% Ho Ta lden, rget Sarah -date f, and Jack unds are often Van Derhe used a i. s the 2002. de“Can fault investmen 401(k) Accumulations t in automatic enrol Generate lment plans a Significant Inco nd in pla me ns’ for Future investmen t lineups Activity i companyn sto2018 ck; and GIC s and/or 2 abstr www.d act $ol. 5-5 2gov/ ,010. 502s pd ites/dolg f. ov/fil2006 es/ebsa/researchers $7,2/stat 92 ist 15% ics/retireme 87% nt$ -b 4,ull 08etins 9 /private-pension-plan-bulletins- 17 10P 0articipants Total Plans Participants Total Assets Balance participants. By year-end 2018, 401(k) plan assets had grown to $5.2 trillion, representing about one-fifth of all represe year fu only the 16 nds Fo 0 -r 401(k) asset f 12% en offered nt a d accou 2018 w to ide , nt b inves 6 ra 212% ap igures, see In nge of lances ercent tors in jurisdi jo o heb f ld p te in th articip 12% ves nure cti 31% tment Co ons worldwi e 401(k e ants xpe in the riences. I )mpan p 12% lans at de. ICI se ir y I twen n nstitute p 2018 ti aeks e rticipants’ s h , to 2020. 45 eld tar encourage pe rcent curr get-e of date fun nt e adh the partici m eren plds, co oy ce t ersp o high ethical standa . mpared ants Retireme in t with he dat nt sa 250 abase h vings h percent rds, pro eld in ad of fmot ive plans or e flu 202 ctuat 1). 15 % ion in 401(k) participants’ asset allocations over 84%time (Figures 7, 8, and 14). However, despite a 4.4 percent >80 percent 14% (*) 1% 1% 1% (*) 1% Endnotes www.b ................................ ls.gov/ncs/ebs/benef................................ its/2013/ebbl0052.pdf................................ . ............................................................ 33 The 2018 EBRI/ICI database covers Pe r25 ce nt pe ar ge cent of of Ac th cou e nt u ni Ba vers lanc e eof Inv 4e 0s 1(k ted ) p in lan Ta p rge arti t-Dcip ateants Fund , 1 s5 percent of plans, $25,Com 000,pan 0o 0 t0 hy I e tro s nst t$ a6 b itute Res 2 le,-5 va 0l0 ue ,0 f0 uearch n 0ds Perspectiv 1,e7 5 19 6, no. 2 (Nov1 ember). Av 1 ,0 ,1 83 07,605 aila 2b ,1le 66at ,1 $ 8 6 w 38ww.i ,518ci. ,5org/ 5$ 02 ,2 0pd 6 8,4 4f5 /pe 4,8r1 306 ,5 -6 02 3$ .pdf 60,. 2 31 (see Plan Retirees? Spon” sInv or Cest ouncil ment Com of America 2019). pany Institut At yea 81% e Pers r-e pe nd 2 ctiv018, 67 percen e 8, no. 3, and t o EB f ta RI rget Iss -ue Brie date mutu f, nal fu o. 25 nd assets were held in DC 1 (November). Available 2007 $7,495 $4,167 3 4 Figure 27, 401(k) Loan Amounts Varied Across 401(k) Participants 11% ................................ 11% ......................................... 27 abstr act 1 t-o2 018. 10 pdf. 313% 5,716 183,846 13% $16,474,250,188 $89,609 21 C retireme 14ha 0 nges in nt assC ets once . In ntr an at on ions i going co n Equit llaborie ative e s Since t ffort, t hhe e Fi Employee nancial B C eri nef sis it R esearch Institute (EBRI) and the public understanding, (*) = less than 0.5 perce an nt d otherwise a1dvance the interests of funds, their shareholders, directors, and advisers. ICI carries out fewer years at p de partici Bycli Sarah revio ne pan in us e ts the S& H in of mployers ol the ten den, P ir ur 5 sixties. 00 e, or tota ICI and ro ; l r 4 lled over Recently J eturn ind pe ack rcent VanDe h into indivi had ir ex, ed t p mo he rhei, artic re than ov du ip era EBR al ants retir ll 30 as I; were s ement a years et al and more locat ofSteven cco t ion enur lik un ely to o ts e f (IRAs B 4 (Fi 01 ass, gu hold (k) re ) are not incl p tar 6). ICI lans in ge T he t-date tme he uded f di Eu an BRI/ nd te in the s than In CI d ure an those ata atalys the base c is. curr with more hanged ent 18 80 Of which: target-date fu2008 nds are an option $7,191 731 1 $,3 8,8 89 8,9108 $176,048,607,504 $62,and 500 ,2 01 0 0 p ercen to $1t of 25,0401( 00,0k) 00 plan assets. T 716 he project is uniq9 ue because 76,724 it includes $62, d 38 ata 7,0 pro 63,6 vided b 82 y a wide vari $63,87ety 4 plans (see In Estimates of th vestment Company e number of 401(k) pl Ins 74% titute ans and acti 202112% ). Allve p ing, Cl artici ark, an pants are d Stinba nett 202 sed on a combi 0 reports that 50 na 10% tion of da 12% percent ta f 10% r36% om t of DC plans he U.S. 10% in their U.S. at De w partm ww.ici.or ent of g/pdf/per Labor, 08 Em -pl 03 oy .pd ee Ben f and efi ww <1ts 00 w S.ebri.org ecurity Administra /cont 8622 ent/ca 0.1915 tion 3n 2-40 . 2 191(k 0 .114 512% 3 )1 - .9 accum Private ulatio Pension ns-g P enerate lan Bulleti -sign n, ificant Abstr -act of income- $45,519 5 11 1t2 o . 32 % 5 22,884 381,594 $29,075,412,033 $76,195 C S 12 o o 0u pyright I rce: Tabulan tifor onsma from ti E oB n: R IT /IC his re I Partport is c icipant-Diopyright rected Reed tire b my en the t Pla Em n D paloyee ta Col lBene ectionfit Res Projecear t ch Institute (EBRI). You may copy, Inves Yearstm ofent Tenu Co re mpany I Zero nst >itut 0 to e 1( 0ICI) >10 tcolle o 20ct >2 annual data 0 to 30 >30 o to n 4millio 0 >40ns of t26% o 50 401(k >50 to ) p 60lan >6 par 0 to ticipants as 70 >70 to 8 a means 0 >80 to 9 to 0 > exa 90 mine to 100 its i U.S. ntern Departm ationaent l work through of Labor, Bureau ICI Glo of bal, Lab wor Statis ith offices in tics. 2014. Washington, DC National, Lo Com ndon, B pensat rus ion sel Su s, and Hong Ko rvey: Employng ee . Benefits in the employer years Furthe on rmo w th re, e asjob: acco six A years unt balan t year in -en 2018 ces d 2 are , 018 2009 dow n , 57 et n of fro pe m rcent o unp seven aid loan f partici $7 y,ears 346balances. B ipan n 2017 ts with an eca d tw use of 2o or few 016 $.3 al ,97l2 the er yea 11% se rs factor of te snure , it is held not correc targett- to date funds, little bet Brady, Peter, wee Alln y and ear M -en ichae > d 12017 0l tB oogd 2 and 0 an. ye a 2 201 r018 s . At 6. “A Loo year-k at end P 2018 rivat , equity f e 9-0Secto ,987 run Ret ds irement were 14,57 0 3 P ,9.0 63 la 4 npe In rcent of com $e 1 Af ,0 th 7ter 3,e 4 11% 4as ERISA 5,s 6ets 25,5 i , 2015 7 n 5the .EB ” ICI RI/ICI $125,000,000 to $250,000,000 428 1,121,335 $73,965,364,979 $65,962 of plan totraecord l keepers 67% and, therefore, r 10 ep 0-5 r0 esents 0 the 6971 acti0 vity .154 of 856 partici 15.48p 56 ants 1 in 401(k) plans of varying sizes — Dep recoartmen rdkeeping sy t of Lastem in 2019 bor’s Bureau o offer a f Labor Sta utomati tisc enrol tics anlment, d Emplo up yee from 48 percen Benefits Security Administrati t in 2017 and 41 pe on. S rcent in ee discussion in note 2. 2015. U. Fig S. ure for 20 De 1 28 -partm f1 Form uture , Loa ent -ns From retir 5500 ofees Labor, A-- nnu 401( 169 al Em .k) R P pl ep lans oy ort ee Ben sTende (Version efi d ts to S 1.1). Was Be ecurity Small Administra hin ................................ gton, DC: tion . U. 202 S. Dep 1b. artm Pr ................................ ivate Pe ent ofnsion Labor, Em Plan B pl ullet ........................ oyee B in Histo ene9 fits rical .9% 28 26 60 to 50 13,008 466,469 $32,074,208,737Bloomberg $ Ba 6r8 cl, a7 ys 6 0 0 10 t0 o 2 43.$ 03 % 9,885 0.9% 01.8% 0.9% 0.8% 0.7% 0.9% 0.6% 0.7% 0.7% 10% 50.1% 2010 $6,846 $3,619 print, or download this repor 23% t solely for personal and noncommercial use, provide 27d that all hard copies retain any and how these par (perticipants ma cent of plan na asge set t sheir ) 401(k) plan accounts. This report is an update of EBRI and ICI’s ong 8.6%oing research More United 401( k) States, plan partici Of whic March 20 h: targpan et-dta 14 st h e .feld e uW nd as squ hin ariti e gton, es at year an opDC: tion U. -eS. nd De 201 pa 78 rtm 1 ,than 46ent 2 at of Lab year 1or, Bure - 1en ,32d 20 8,823 07 au , oand f Labor Statist a$ l8ar 32ge ,04 r percenta 0,7ic 08 s,. Availabl 150 ge of e at presume com 401(k pare ) dat d wit that t abah she e 54 (Fi ch pe gang ure rcee nt o 15 in t )f , l he p ittle articip aver change age ants or d with med from mo i an 4r0.3 e ath cco p aercent n unt b five a at to lance 10 ye year for -en ars the d of 20 database te 17 nure, . Bal and anced as a 36 w f hole pu ercen nd reflects s, t of partici which the inves e pan xtpe in b ts rience w oth ith 6 $37 Researc ,323 h Perspective 22, no. 8 (December). Available at www.ici.org/pdf/per22-08.pdf. >$250,000,000 100 plan assets 50 594 1-1000 3481 70 ,.7 08 77 93 ,2 18 907.7 23 0 21 88 0 6EB $6 R8 I/8 IC ,9 I 74,U 4.4 S4 . , A3 g1 gr0 egate Bond $88,453 10% 7.4% This upd from very ate e xtends prev large corpor ioations us findings from to small bu the p siness rojes ect for — with 1996 a variety o through 2016. Fo f investm r ye ent ar-opti end ons 2016 . results, see Hol 9% den et al. >2 to Tab Security A 5 les and dmi G4 rnistr aph 4.8% sation (Se 197 15 .4– % 2018 p2011 tember) 1 (V .2ers % . Avail ion 1. 1.0). Was 4 abl % $ e7 at ,02hin 71.3gto % n, DC: 1.1 % U.S. D$ 1 e 3 .partment 2 ,7 % 85 0 of .9% Labor, Emp 1.1% loye 1e .2% Benefits 4 4.6% 19 3480 51 to 100 8,298 5F 8i3 g,u 4r6 e0 5 $37,734,756,236 $64,674 6 4 all Fo At yea copyr r anr an ig -e ht nd 2 al a ysi nd 018, 57 percen s of the ch other appli ang cable es in a t of n non otices cco -target unt b co- alan A ntaine date ba T ces of co d la th A nced er P nsistent pa ein, e fu G rcend n a L tnd yo aass gA e o ets were ass rtic fN u m ipants in th C P ay cite or eE rcen tumed age EBR e qu of to ote sm I/ICI 401(k) be inv all porti ested in Inde data xons equities ( of base th in the w e rsee eportak e of into 401(k) plan participants’ activity through year-end 2018. The report is divided into four sections: the first young ww erw.b inves ls.gov tors/ ncs had /eb highe s/ber conce nefits 5.1 /2 % ntratio 014/eb ns in eq bl0055. uities. pdf. Overall, at year-end 2018, less than 10 percent of 401(k) plan mo of “ty re than pical” 40 30 4054% 1(k years ) p of lan 100 t p enur Parti lan A e cipan s(sFi etgu sts --re . ( Se 20e A ).1 0bout 01-500 C 0hange 9054 s in Acc 0.20ou 112 nt B 8 2alances on 0.11285 page 8.) equities and fixed-income securities, increased only slightly in share, accounting for 31.2 percent of the assets i53% n the All 90,987 14,570,634 $1,073,445,625,575 $73,672 Holden, Sarah, Jack VanDerhei, Luis Alonso, and Steve 2 n Bass. 2013. “401(k) Plan Asset Allocation, Account Balances, 2018. Fo Figure >5 to 10 r ye s ar-end 452017 .6% res 2ult .1% s, see the a 2012 1.8% pp3 endix. .92 % .0% Results for earlier years $7,1531.8% 1.4% are $ 13 .4 ,av 8 % 58 ailable i 1.2n ea % rlier issues 1.5% of 1ICI Research .7% 39.5 % 60 S&P 500 Security www.dol. Agov/ dministr sites/dolg ation ( ov Jan /filuary es/ebsa ). Available at /researchers/statistics/retirement-bulletins/private-pension-plan-bulletins- 101 to 250 405 1,(7 k2 ) 5 Participants 8 R 9e 4p ,9 r7 e6 sent a Ra $n 54 g,e 7 6 o4 f, A 14 g5e ,6 s02 $61,191 Investment Options Offered by Plan 3.1% Plans Participants Percentage of Assets the f Investmen inancial cri t Compan sis (over the e y Institute, ight Quarterly S -year perio ud from yea pplementary r-e D nd ata). 2010 T2 he a to .5% yea llocratio -end 2 n to equiti 018), see es in target Holden, Van -date De fu rhei, and Bass nds varies with the 2020. Brady, providePeter, d that Kimberly you do so ver Burhbatim a am, and nd wit Sarah h Holden. proper ci20 tat 1i2 on. Any u . The Succes se beyo s of nd the the US Reti scope rement of the for Syse tem goin (g Decem requirbe es EBRI’s r). describes the EBRI/IC 100 I 401( Partick) ip d anatabas ts-- e; t> he 500 s0 econd pre 16888 sents0 a .37s 5na 156 pshot of 37.2 5.1 1 5 % 5 p 5articipant account balances at year-end participants held no equities, down from 13 percent at year-end 2007 (Figure 18). Y 1.8oung % er 401(k) participants were database >10 to 20 at year-5 e1nd .8% 20184.. D 2% esp 2013 ite 3.mi 1% nor mark 2.8% et $7 s,hi 42 fts 12., mos 1% t 40 1.1(k 7%) partici $ 13 .5 ,9 % pan 73 ts a1pp .4% eared1 n 1 .5 ot .7 % % to have 2.3 mad % e dramatic 27.3% and Loan Activity in 2012.” ICI Research Perspective 19, no. 12, and EBRI Issue Brief, no. 394 (December). Pers 40 pective (www.ici.org/research/investors/ebri_ici) and EBRI Issue Brief (www.ebri.org/publications/research- Investment Options Fi gure abstr ww 1, w.d act 401( 25 ol. 20 - 12 gov/ k) t011. o P 5lan s 0 pd ites/dolg 0 fC . harac ov teris /files/ebsa tics2 b ,3 y N 2/resea 8umber rchers of Plan /stat 8 Participa 0i8 s,tic 92s1 /retireme nts, 2018 nt $4-9 ................................ b,ull 07etins 0,75/p 4,rivat 791 e-pension ................................ $6 -0 pl,a 6n 6- 2bulletin- th 8 Equity, bond, money, and/o39% r balanced funds 67.9% 27.6% 24.1% Percentage of active 401(k) plan participants and 401(k) plan> a 2sse to 5t s ye ba yr s particip 16% ant U. funds’ target d S. Department ates. Fo of Labor, 100 r target Par tBureau ic- ip date f ants- of -unds, in Labor Statis vestors were as tics. 2015. sume National d to be i Com n a fund whose pensation Su target da rvey: Empl te wa oys ne ee B arest to th enefits in eir 65 the prior express permission. For perm 2014 issions, 28 please contact $7,780 EBRI at p 23% ermiss$ ions@ 4,239 ebri.org. 20 >21 08 W t; th o as 30e hin th gton, ird look 5 DC: In 9.s 0 at % p ves art 6tm .0 icip % ent Compa ants3 ’ ass .6%et nyallocations Inst 3.0% itute. Avail , i2 n.clud 3% abl ing e at 1 analys .9 ww % w.i is of ci.org/ 1. 401(k 7% pdf/ ) p pp 1a .7 rticipants’ r% _12_succes 2.1 u %ss e_r of etirement. 2 targ .7%et-date, pdf 16.. or 1 % much more 20 likely to hold equities and to hold high concentrations in equities at year-end 2018 compared with year-end Note: The median account balance at year-end 2018 was $16,010. shifts in their asset allocations in 2018. Since 20 Because of th 1996, the es Em e cha ploy nges ee B in enefit R the cross secti esearch ons, Inst co itute mparing a (EBRI) and verage accou the Invest nt ba ment Com lances acr pan oss di y Inst fferen itute t ye (ICI) ar-end have wo cross-rked publicati Availab ons/i less at uew -briefs ww.ici.or ). g/pdf/per19-12.pdf and www.ebri.org/content/401(k)-plan-asset-allocation-account- 1 501 to 1,000 1,303 917,068 $59,128,34625% ,031 $64,475 histo 5%rical-tables-and-graphs.pdf. 100 Plans-- 2015 sum $7,982 45016 $4,359 Of which: target-date funds are an option age, 5 2 2.0 4% 18 21.9% 2018 For 1m 8. 2 5% 500 birthday >30 United . The e States, quity porti 64 March .3% on w 2015 6.7as e %. W stimated u as 3.hin 5%gton, sing the 3DC: .0% U. indust S. De 2.3 ry a pa % rtm vera ent 1 ge .9% of equ Lab ity percentag or, Bure 1.6% au 1 e .o 3 for the a f L % abor Statist 1ssigne .2% d target ics1 . Availabl .2%-date fund e 1 at 3.1% Size of 401(k) Plan Account Balances lif S fhe r $o 2m f 0ou , 0E 0rth f B 0 R >I/ $ ocu I3 C 0I, s 0 P es 0a 0r on ti> c$ i p p 4a 0 artic n ,0t0 -D 0ip irants > e$ c5 te 0’ d ,0 40 0 R 0 1(k et> ir) $ e l 6 m oan 0,e 0n 0 ac t0 Ptivity > la $n 7 0 D ,.0 a 0t0 a C >o $8 lle 0,c 0t0 io 0n > P $r9o 0je ,0c 0t0 >$100,000 >$200,000 2007. For example, about three-quarters of 401(k) plan participants in their twenties had more than 80 percent of their 0 30% sectio together nal snaps on collectin hots can lead t g and analyzin o false co g anclusio nnual ns. Fo data on r exam millions of 40 ple, newly formed plans 10 1(k) plan partici wopa uld tend to pull nts’ accounts dow . Thin th s ree av port r eref age lects U. Fig S. ure bal De 2, anc partm Distr es-ent an ibution dof -loan Labor, of -activ 401 Em ity (k)pl - P in oy lans, Part -2012 ee Ben -532 efi icip 5 ts . S ants ecurity , and Administra Assets................................ tion. 2015a. Private ................................ Pension Plan Bulletin, .................. Abstract of 8 2016 $7,907 $4,279 Investment 1,0 o0 p1 tions to 2 are ,50 g 0 rouped into e 937 ight broad categori 1,44 es. 9,80 9 $100,989,969,996 $69,657 7 100 Plans-- All 44.2% 2.7% 1.9% 1.9% 1.5% 1.3% 1.3% 1.0% 1.2% 1.5% 3%41.5% Brig Repo htrt Scope avail Eq $ a u 2iab 0 nd ty ,0 , I 0 il b0 nves it ony: d to , m Thi tm $3 o0 n ent s ,e 0 r y 0ep , Company 0 atort n od $ /o i 4rs 0 availa b ,0 a0 la In 0ntc os e bl t $ ditute. 5 e f0 u on ,n0 d 0 s0 ;th 20 toe 2 $0 i6 nte . 0T ,0rnet at he 00 Br to ig $7 ht w 0,ww.e Scop 000 to e/ICI bri.org $80, D 00 e 0 an fin tod e $at d Cont 90 ,ww 000w.ici.org ributio to n Plan 8%Pro to file: A Close calcul The EBR ated u I/ICI 401(k) sing the Mornings databas tar L e enifetime Al vironmenlo t catio is certi n In fied to b dexes (see Morning e fully complistar 20 ant with th 18).e IS For the a O-27002 vera Ige nform 401(k) pl ation S an ecurity Aud asset it www.bls.gov/ncs 100 /eb ors F /b ew enef er its/2015/eb 101 tobl0 5005 0 7.pdf. 5 01 to 1,000 1,001 to 5,000 >5,000 Asse At year account balan t A -end llocat 201 ces ion and P 8 i , the nves avera ted ar in ge ti equ ac cipa iti count es at y nt A bge al ear ance -end was 2018 $73 com ,672 pare and d wit the m h less edian tha accou n halnt b f at y alance ear-end wa20 s $1 07. 6,Ol 010 de ( rFi 401(k gure )9), account balance but would tell us not 2017 hing about consistentl $7,935 y participating workers. Simi $4,293 larly, the aggregate average account the year-end 2018 2update of these data and EBRI and ICI’s ongoing r 7%esearch into 401 2,3 (k) plan participants’ activity. U.S. 20 Gov 09 Form ernment 5500 Accou Annu ntab alili Rty eP p Office. e ort rce s nt (Version a 19 ge97 of. A “401(k 1.1). Was ccount) P Ba ehin lnsion Pla anc ge ton, DC: Invens: L ste d U. oan Provis in S.N Dep on-Ta artm rge ions ent t-D Enhan ato ef Labor, Em Bac lae nc Pe arti d Fu cipation plnd oyee B s but M enefits ay 2,501 to 5,000 379 1,327,696 $103,668,813,883$100,000 $7$ 82 ,0 08 0,2 000 Equity Fua nn dd s GICs anC d/o o m r p oa th ne y rS s to ta ck b²le-value fu Bn ad lasnced Funds 30.3%Bond Funds 45.7%GICs and Other Sta4 b3 le .8 - % Money Funds allo stan cati dard. More Loon to ok at equities ( 401( over, k) P EBR lans, through e AcI ha tive 2s obtai 017 401 quity f (. kSan ) ned Pla unds, D na legal opi ieg Pa co o, rti CA cmpan ipa: Bri n nio ts y s n th gh totSco ck, and th at the pe a methodo nd e eq Was uity logy hing port use ton, DC: iod meets n of ba In la the priva ves nced f tment Com uncy sta ds) by nda pan partici rds of the y Inst pan itute. t ag Gramm e, see - Number of Plan Participants 2018 $ S 8i,z 1e 6 2 of Account Balance $4,486 bu Fi Ho partici gt ld ure bal en, pan anc 3, Sarah 401( ts es v were , Jack Va k) aried Pmu lan w ch C ide nDer harac less ly. For hei, likely teris e Luis tics xam to Alons b have pl y e, Pla a o, and Steve sbout n uch Asshi thr ets gh con ee , 2 -0 qua n Bas 1centrat 8 rters ................................ s. 2 of ions 018. the in equi part “401(k icip ti)es at y P ants lan ................................ i Ass n ea tr he et All -en 20 d ocat 1 20 8 1 EB io 8 RI/ n, compared Acc ICI 401(k ........................ ount Ba with y ) d lan atces ear abase , - 9 balance would tend to be pulled down if a 1 large number of participants retired. Value Funds • Equity funds consist of pooled investments primarily invested in stocks, including equity mutual funds, bank Security A Affect 5 In ,0com 01 dmi to enistr Se 10cur ,0 ation (Jan 0ity for 0 Suary) ome.” 209 . Available at Letter Report, GA 1,4 O/ 42 H ,6EH 20S-98-5 (Oct $121ober). W ,093,155as ,5hin 39gton, DC: $83 U. ,9 S. 4 0Government Figure 19 Of which: target-date funds are an option 25.0% 33.9% 32.6% U.S. Department of Labor, Bureau Less Th of an Lab $10,or 00Stat 0 istics. 2016. National Compensation Survey:M Empl ore Th oy aee n $B 10 ene 0,0fits 00 in the >$40,000–$50,000 Lea Figure ch Av -Bl 15. ailab iley Act. At no t le at www.iime has ci.org/pd an f/2 N yo nonpu 0 te_ppr_ : Averbl > adcpla 5 g ic e t personal informatio o a n1 d n_p 0 S m iy xe e tro id e a ia s rfil s n e 4_401 01(k) k.pdf loan th n a. mat is personally identifiabl ounts are calculated e, such as a Social Security EBRI/ICI 0% 401(k) Database Twenties Investment Category 1 to 100 101 to 250 251 to 500 501 to 1,000 1,001 to 2,500 2,501 to 5,000 5,001 to >10,000 All Plans Key Findi Years of Te ngnu s: re Zero >0 to 10 >10 to 20 >20 to 30 >30 to 40 >40 to 50 >50 to 60 >60 to 70 >70 to 80 >80 to 90 >90 to 100 had end 200 a and cco Loa 7: unt 14 balances n pe Act rce ivity nt of i th n 20 401 at w 16 ere (k) .” p ICI Re lo lan partici wer than search pan $73,6 Pers ts i72 pe n th , t ctiv eir s he s e 2ixties h ize 4, n of o. 6, the ad and ave more tha rage acc EBRI n Is8 sount 0 ue pe B rrie bal cent of fanc , no. e. In fa th 458 (Se eir a ct, cco ptemb 41 unt balanc .8 pe er) rce . nt of es As in previous Part years, icipan the ts database for year-end 2018 shows that participants’ asset allocation varied considerably with collective trusts, life insurance separate accounts, and other pooled investments. Since 1996 A > E s ,1 q th s u 0e i,te 0 t y ,0 A Em b 0 lo lo n pl c d,oy a m tie o oe B n n e y D enefit R , ia sn td ri/b oru b esear ta i200 o lan n co c efh d 4 fInst u 0n 1 d(s k itute ;) Pa (EB r6 ti,c 1 RI) and i1 p4 a,n 1t7 A 5 the cco Inv un$ t est 4 B 6a 9 ment Com l,a3n 7c 1e ,8 t1 o2 B ,pan 5a 3l8 ay I ncnst editute Fu $7 n6 ( dICI) ,s 7 6 b8 y h A ave wo ge rked 21 1 ww Abo Accw.d ountabi ut C ol.gov/ lity hange sOffi ites/dolg ce.s in Availa ov/f Acc ib les/ebsa le ount B at www. /resea gao alanc rchers .gov/archiv 13%es /stat ist e/ ic1 s99 /retireme 8/he9800 nt-5. bull pdetins f. /private-pension-plan-bulletins- among participa19% nts with 401(k) loans at year-end. 1996 2000 2002 2005 2007 2008 2009 2012 14% 2013 2014 2015 2016 2017 2018 TaUnited bulatio States, ns of the S March 20 urvey of 16 Co . nsu Was mer Fina hington, nces re DC: U. vea S. l tha Depa t 58 percen rtment oft o Lab f tra or, Bure ditional I au 1RA assets 0o ,0 f L 00abor Statist in 2019 ic resu s. Availabl lted from e at nu Almber, been t l indexes are set ran to 1sfe 00 in rred to o December sh r 200ared 7. with EBRI. Fi 0 g to ure 2 4, EBRI/ICI 40 93.2% 1(k) D 1.a 5tabas % e 1R .0ep % resents 0.5 a % Wide0 C .2ros % s Se0 ction o .2% f the 0.1 % 401(k) U 0.1nivers % e 0 ................................ .1% 0.1% 3.1... % 10 35 29 Percentage of participants Size of Accoun1 t Balance age. partici invest FoAv r ye ed pan Youn ailab ar in ts a - e end n le ha ge dq at c uities at rd o 2partici m 017 da w acco pww.i anyunt bal pan year s ta, see t ci.or toc ts k-g/pd te end ances of nd he f2018 e /p appen d er to l 24 f ess com avo -dix 0 t 6.p pare .han $10 r eq df d with 30 uity and f , 000, ww undw.e s a whi pe nd bri. rce 0 le . 6 bal org/cont nt of 1 %8.5 an 401 ced perent/ funds, cent of (k) p 4 101 1 lan partici .8 part ( whi % k)-lpl e ici aol pan nde pan -as r ts sts partici et h i- an allocat d th a 1 pan cc eir s 2.9 ount balanc ion % tsixties at w -aere cco more unt yes ear - l greater -iend kely 2 Source: Tabulations from EBRI/ICI Participant-Directed 1 Note: At yA ea lrl-end 2018, the average acco 9 u0 n,t9 b8 a7 lance among a 1l4 l 1 ,5 47 .60 m ,6 il3 li4 on 401(k $)1 p ,0 ar7 ti3 c, ip 4a 4 n5 ts ,6 w 2a5 s, 5 $7 73 5,672; the$ m 73 ed ,6 ia7 n2 account together abstr on act c -2 ollectin 009.pd g f.a nd analyzing annual data M N on ue m di b mil e arn otlfions of 40 e P nu artric ei: pa 6nty s1(k e ia n r) P s p lan la n participants’ accounts. This report reflects The S&P 500 is an index of 500 stocks chosen for market P siz e er,ce liqu n id ta ity g , e a no d fi np da usrttriyci gp roa un p trs, epre 2 se0 n1 ta8 tion. MiChoi, James J. nor investment opt, D ionsavid are n Laib ot sho sw on n, ; th Bri eregi fotte re, c C. Ma omponedrian nts do, and not adAndre d to 100w peMetr rcent.ic Pk. 2001. ercentages“D are efined dollar-w Contri eightedbu ave tiron Pens ages. ions: Plan rol >2lo to vers ww 5 w.b from ls.gov emplo / 8ncs 9.yer 5% /eb -sponsored reti s/b 2.e 1nef % its/2 1.0 reme 516/eb % nt plan bl0 0.05 9% s. 9. pdf. 0 .4% 0.4% 0.2% 0.1% 0.2% 0.1% 4.6% Sources and Types of Data 1 19 •9 6 The bulk 1010 999 of 240 002 1(k) ass 2007 ets we 20re 08 inves 20ted in 10 2 stock 012 s. On 20 avera 13 ge 20, 1at year 4 2- 0en 15d 201 28 0, 16 63 perce 201nt of 7 42 00 1(k 18) 8 3 2 balan •c e wBond a s $ O 1 f 6 f ,w u 0nd h 1i0 c.s h A ar : c ta ce ro gu pool en t-td b aa ed te la acco n fu c R n e e d sts iraunt e rm a er e e ps n a a trprima n tP i c lo a ip p na t iD n o rily ta n ta ac invest C co ou lle nc t tb ied o an la i 0 P nn .r c 3 o b e % je so c h nd t eld s . in 401(k9). 1 p% lans at the participan 1t0 s.' 3 c% urrent employers and than 20 U. Acco S. 07. bal Interna $1 un Aanc 0 lt balan 0,0 ow es er 00 ( l Revenu -an s ces are hare Fi d-g loa ure h e neld n net of -S 10 activ ervi ). o ce. 198 T ity un eq he -paid lo in uiti var -2016 es. 1. iatan “Not ion . bal iice nan account ces. Thu of Propose bs, alan ud npa ces Rule id l p Making, artly oan ba refl la Ce nces a ects rtain the re n Cash eot ffect in or cl suded of Defer part in an red icipan A y o rrangem f th t ag e eight as e, ten ents ure, Under set to invest The R In uss ord e in ll 2er to 0fixed 00 In ana de-xincome mlyze easu re t sec he s thec urities such p han erforge ma nin partici ce of as the b 2,0 pa on 00nt account d fun smallesds, t U.S G . bal ICs com an p ances ov anid es ot (bahe seer d r sta o ti n me, it is tobl tae l m -valu arke i t e fund mpor capitalitant to h zs at,i or on) in mo cluave a dn eey f d in t consis u hend Russ ( seF tent llig ure 15). Nodata 36 t all pa thro rticipugh ants a year re off- een redd 20 this i18 nvesand tmen EBRI t option ’s an (seed FiICI gure’s on 16). goin g research into 401(k) plan participants’ activity. >5 1 to t o 1 0 10 11 to 2 85 8.5% 26 to 2 5.0 7% 51 to1 1 .9 0% 0 101 to 1 .2 25 % 0 251 to 0 .5 50 % 0 501 0 .t4 o% 1,00 01 .3 t% o 2,50 0.12 % to 5,00 0.1 2 % to >10 0.,1 0% 00 All P 3l.a 9n % s Rules, Participant Decisions, and the Path of Least Resistance.” NBER Working Paper, no. 8655 (December). Plan-specific information on loan provisions is available for the majority of the plans in the sample (including virtually all of Figure 5, 401(k) Participants Represent a Range of Ages ........................................................................................ 11 22 Soupartici rce: Tab pan ulatts io’ a nss fs ro ets m w EBere inv RI/ICI Pest artied cip in ant-eq Diru eity sec cted Reurities tiremen th t P rough lan Da e taq C uity ollec fund tion s P, th rojee equ ct ity portion of balanced 3 3 a0 re 00 n Ie nd t eo xf (p wE lh aiq n cu h l io ttry a a,n c k s bs.o tn R hd e e, t 3 im r ,e 0o 0 m 0 n e e la n y rtg , e s a sa n tv d U in /.o S gr .s c bh o ae m la lp d n a c in n ie e d p s) la .f u nn sd a st; previous employers or rolled over into IRAs are not included. Percentage of Account Balance Invested in Balanced Funds No tAt yea e: Accro-u en nd 2 t bal018, 3 percent ances are particof the pa ipant acco rtic unipants in th t balances he da eld in ta 4 base 01(k were missi ) plans at thng a e par birth date ticipants’ c entry urrent , w emp ere y loyerounger th s and are a nn 2 et o0, f p or lan GIcategori CM s e ard e ig aun es des aranteed c ribed. investm ent contracts. 1,000 2,500 5,000 10,000 S U. s For exam o alary, u S. rc Em s eDe ample : contrib Tpl partm abN oy p ule, am lo aee Plan t to ie o f part ent : n ution behavior sT fh ong partici rof o e m icip s Labor, m .” Ee B ants Fd R ed iIa /Ier C n . Com Em I pan al a P , rol c apl R rcts tie o oy c paring aver lovers i gi u ipn n ee Ben a s th n tter tb -D eir t a ifro 46 rle acn efi , m other twen e cno. d ag ts e R S a e ti e21 ttecurity es, acco iry e7 e p m the (N a e la ru n-ns, te nt ov P n Administra average F ld emb a ass bal ig n 2 u D 0 a ra et all er 10) 1 e nces acro ta 8 1 al C w 8 oocat a loca tion lle : 555 sc t$ i. 2 o tion to i1 on, w s ns 6 44 0 P d ,0 15b. ro i– 1 ff je it 5554 0 er ceq hd .tent Pr u ra ity ivate Pe 9. wa ye and ls, ar- l e oan act bal nsion nda sna nced Plan ivit pshots fun y, and Bu ds llcan l etin, w e as mp e Ab ad 80 loyer s to pe tract rce of nt >10 to 20 85.8% 4.2% 3.0% 2.0% 0.8% 0.6% 0.4% 0.2% 0.2% 0.2% 2.7% U.S. Department of Labor, Bureau of Labor Statistics. 2017. Figu rN e ational 27 Compensation Survey: Employee Benefits in the 4 80 Note: The tenure variable is generally years working at current employer and thus may overstate the sCambrid mall plans ge )., S Mome pl A: National ans wiBu thout this informatio reau 2 of Economic Researc n are class h. ified as h Available at aving a w lo ww.n an provi ber.or sio g/paper n if anys /w86 partic55 ipant in the . plan has 177.7 0.108473 10.84727 S To he u rB cle oo : m Tb ae bru gl a Btairo cn la sy s fr o Um .S .E AB gg R re I/g IC atIe P Ba orn td ic Iin pda en xt - is D c iro e m cp te os de R d e oft is re ec m ue ritn ie t sP clo av n e rD ina g tg ao v C eo rnlm lee cn ttio an n dP cro orjp eo c ra t te bonds, mortgage-backed securities, NotSeveral A e:ge Fu • n ds recor inBalance cc luo dm ed p m keepi a un td fun u ya ls ng ftu o nc d d o k s s; are poole ,rgan a ba nn dk G izations cI o C lle sct d ia ve n a d provid tcco r/u osrtunts invest s, lied fe i r nsecords uranced e s o e in both sto pn ac aratetive pa accouck ntrtici ss , an anp dants d bon any p ion 40 ds. Th oled i1(k nve ey s)t p m are ela ntns at ye cl proa ds us cifi t ped ar rim- a end into t rily in2018 vw eso ted. T in h the es se ecurity l oans. Retfun iremds, ent an sad vi co ngsmpany sto held in planck s . atTw pre evnty ious -ei em gh ptlo pe yerrce s ont of r rolle ass d ovets er in w toer IR e Aisn afrix e ed no- t income included sec . Thurities such e tenure varia as ble stable is gene-rvalu ally e Ho lden, Sarah, Jack VanDerhei, and Steven Bass. 2020. “What Does Consistent Participation in 401(k) Plans Generate? were older than 69. They were not included in this analysis. >20 to 30 82.5% 5.4% 3.9% 2.8% 1.2% 0.8% 0.6% 0.3% 0.2% 0.2% 2.0% contr 20 ib1 utio 2 Form Sn ou E ra rx ctes p e5500 :o . T T sa u his brA u ennu l a pa tto io pe al E n R s q r ex u fe ro p itam m ort ie s E ines t s IB ( n Version R cIr/h e IC e aIs relat P e1.2). Was a dr tionshi A icm ipa on n p betw tg hin -D 4 irg 0 eton, DC: 1 ceen t(e kd ) acco P Ra e r tU. itrunt balanc ie c S. m ip e Dep a nn t tP artm sl a B es a ne ent D tw nd ate o a e partici f Labor, Em C no 2 ll0 e0 c pan 7 tio a n ts n ’ pl P d age ro o 2 yee B j0 e 1 c an t8d ene ten fits ure. of asfalse con sets, com clusio parens. d with ab For exam out 4p 0 64 le, 1( k pe a ) dd L rce oing a nn t of a l Am a as rge numb os uets nts am Vaong partici rer o ied fA ne crw plans ospan s 4ts 01 i(wit n k)th h Peir a sr maller tis cixti ipa es. b nta s la Youn nces to th ger part e da iciptabas ants h e woul ad d 9 Fi ang dure aUnited sse 6, t-ba401( ck States, ed s y k) ee c P a urriarticipa s t March 20 ie o s f( rp ea ba rt lnts a ic nc ip e 17 R a d tm e i.o present oW n n ti has n ly thin b h ye m a Rang gton, 4 a0 rk1 e(tk c)a DC: p pe ilta aof ln izU. .a Job tiS. on ).De T Ten he pa inur rtm dees x'sent ................................ totalof re Lab turn cor, Bure onsists of pau rice o af L p................................ preabor Statist ciation/depreciaic tio sn . Availabl plus in............. come e at 12 ind icated. 169.9 0.103711 10.37114 an G Th r outstanding ou e cro p ss-Z sect ero lo ioan na balan > l ana 0 to lysis f 1ce. 0 T >1 or t his may 0 to his pub 20 > un 20 lide cati to rstate th 3on found 0 >30 e nu to 4 that c 0m> ber of plans 40 onso to 5li 0dating th >50off to ering lo 60 e mu >60 lti an tple accou o s (o 70 r partici >70 tnts a o 8pan 0 cro >ts eli 8ss a 0 to gibl 9majo 0 e f >rity o or l 90 toans) o f th 100e other stable-value funds 1.2% 14.9% 19.2% years working at current employer and thus may overstate years of participation in the 401(k) plan. 1 pl >3 an 0 recor invest sub dke categor ep ments ers 80 .ies: include 9, bo % targe nd5 .mutual funds 8t % -date , mo fund c 4fu .0nd ney funds, % s and ompan 2.non 9% ies, and th -target banks 1e .4-f% date ixe , insurance d- b inc a 0.lom anced 9%e compan portio fu 0nd .6% n sies, a . o f balance nd 0.3 co % nsultin d fun 0.ds. 3g firms % . Althou 0.2% gh 2the .7% U.S. Changes Joint Co i mm n 4ittee on 01(k) P T lan axation. Account 2006. Balances, Technica 201l 0E–xp 20 lanation o 18.” ICI Re f H. searc R. 4h , th Pers e “Pe pectiv nsion Protect e 26, no. 6, ion A and ct of 20 EBRI Is 06” a sue Brie s f, Figure 25 as 4 0 a 1 pe (rk) ce n lo taa gn e o b f a thla e n orce igin s ala in s ve a s tp me en rce t. ntage of 401(k) plan account balances for 401(k) participants with loans by participant age, 60 Number of Participants in Plan Sou cons 23 rce: tend Security A T ist abently h ula to pull tionP s ie fS rgh dmi oro m d ce u er E o rnistr c n a B wn e tR a llocatio :I g /T Iation (Jan t C e a he Ib P o u af lav ra tns to targ 4 itc ierag 0 o ipn 1 as n (uary) k) t-fe D ro ip acco rm ea c et . Available at tE retd i- B u ci d R R nt ate funds. A p e I/ta I ibal rC e n m It s P a en nce. a b tr y t P i c la ain p g Thi a t D e n a arget F ts to - a i cou D g f C iu p r oe ra l- le c e date, lrd c t te 1 itci ith d o 1 n p R en be or lifecycl P a e rn o tijrt ee ,cm t mistak y ee na t rP e, fund -e la enly desc n nd D 2 a 0 tpu a0 C 7 rs o rib a ues a lle ned c dt iy as o l e non a an Prr-g o e- je n indic term c dt 20 ation that i1 nves 8 tment Copeland, C 20s 33rai .6% g. 2011. 2.0% “Target Dat 1.3% e Fun 1 1.2 d U % se in 40 0.9%1(k) P 0lans an .9% d 1 t.he Pers 0% ist 0.ence 7% of 0 The .8%ir Use, 2 0.8% 007–2009.” 56.6% EBRI T able of Contents 86.2 0 .052619 5.261873 At yea www.b r-end 2 ls.gov 018, 16 percen /ncs/ebs/benef t of th its/2 e pa 017/eb rticipants in th bl0061.pdf e d . atabase were missing a date of hire entry and were not included in S provi becau ourcders to the single individual o ese some : Tab u l aO tifo plans ma w ns h ifc ro hm : t a E y rg Bha e R t-Iv d /Ie offere a CtIe P fu awning the n rtd ic s d a p ip a a F n rie tft-la iD a en loan, but no n is m resu r e ocptte io dn lted i Retiren an o me partici nt P vera 0l.a8 pan n% ll D increase of 2 a t ha ta C do tak llecen out a tio 1n 3 ..9 percent in the a P 0% roje lo ctan. It is likely th v1 era 6.4ge 401 a % t this o (k) missi plan on is 2018 EBRI/ICI All 88.8% 3.0% 2.0% 1.3% 0.6% 0.4% 0.3% 0.2% 0.2% 0.1% 3.1% Sources: Bloomberg, Frank Russell Company, and Standard & Poor's EBRI/ICI project has collected data 401(k)from 1 Loan 99 Ac6 ti throu vity Vgh arie2d 01 A8 c,r the oss u 4n 0ive 1(krs ) P e la of n data Part p icirp ov an id ters s may vary from year to no. 514 Passed by (Oct the obe Ho r)use on . AvailaJbl uly e at 28, ww 2006 w.ici.or te , and nurg/pd e as Consid , or fa /pe cco r2 u6 nere t- 0 si6.p d by the ze;d se f a le nd ct Senat ew dw yw.eb ea e rs on ri.org Augus /con t 3 tent/ , 2006 what . JCX -doe -38 s--cons 06 (Augu istents-t 3). 30s 30.7% 3.3% 2.5% 2.2% 1.7% 1.5% 1.5% 1.2 T% hirties2 1.5% 1.6% 52.1% Relationship of Age and Tenure to 401(k) Plan Account Balances Fi gure ww 7, w.d Dom ol.gov/ estic s2ite Stoc 7 A 1g .s 3/d ek a olgov 0 C .1n o 6d 5 m 6Bo /f 0 p 9io lnd Mark es/ebsa s 16 it.i 5o 60 n 25% 8 6 /resea o etf In Se dlexes rchers ecte ................................ d/stat 401ist (kic ) s P /retireme lan Accnt ou - ................................ b null t B etins ala/p nc rivat e Ce a-tp eension go............................... ries -plan-bulletins- 13 s 1tratbal egy, usin ances are g a mix of declining as, set class but it woul P es that ercd ent tell f age ollo us of w nothing a aa c p cou red ntetermine bout bala consis nced real invtently eslocatio ted ip n articipati e n, quty itip eic sally re ng work bal ers anc . Si ing milar to sly, the hift its focus 401(k) Issue Plan A Brie ll L f, n oan o. 3 Act 61 (ivi Auty gu Vari st). Available at es With Par wwti w.eb cipa ri.org nt A 10/ 0ge, content/tar .0% Tenure ge , 1t0 and -0 date .0%Ac -fund count B -use-inalan -41 01 00ce (.k) 0% -plans-and-the- this analysis. acco Introductio small, un as t balan U.n S. ................................ cGo e. This statistic vernment Accountabili should be inte ................................ ty Offrpreted wit ice 1997 found h cau ................................ tha tiot mo n, as it may re than 95 percen not represen ................................ t oft 401(k) pl the total 401( ans tk) asse ha.......................... t offer lo ts ow an ned s ha by d at 6 The analysis io n clud A target es the 14 -dat .6 m e fund illion pa purs rticipues ants a l in on theg y-e term ar-en i dn 2 ves 018tm EB ent RI/Is Ctrat I 40eg 1(ky, usi ) datang a base.mix of asset classes, or asset • More 401(k) plan participants held equities at year-end 2018 than before the financial market Perce(n pte arg ce e n otf e olfi g pia brlte ic 4 ip 0a1 n(tk) s) participants with 401(k) loans by participant age, t24% enure, or account size; selected years Source: Tabu40 lations from EBRI/ICI Participant-Directed Retirement P Flia gn u rD ea 8 ta Collection Project year. 40s In ad 3di 5.ti 8on, the % 5 p .0% lans with any 3.7% given 3.2% provide 2.2r m % ay chang 1.8% e from 1.7 y %ear to y 1.3% ear, which 1.6%change 1.8s % the plans 41.8% provided. partici Washin pation gton, -in DC: -401 U.(S. k) - Joi pla nt n Committ s-generate ee- o chn ang Taes xation. -in-401( Availab k)-plan le at -acco wwuw.jc nt-ba t.gov lances /publ -201 ications 0-2018 /200 . 6/jcx-38-06/. 1 30 933.1 0.569589 56.95886 U.S. Department of Labor, Perce n Bureau tage o of f p Lab artici or Statis pants w tics ith. 2018. accou n Nt ational balance Com s in pe sp nsat eciion fied Su ra rvey nge:s, Empl 201oy 8 ee Benefits in the from gro agg abstr rwth eg act ate - t O 2o in f012. ave whicom crage acc pd h: f te a . as t r get-d ount he fun ate f ubal nd ds anc a pp are woul e ro aaches an n opd ti ten on d pas d to be ses its pu 78lled d .5 targe % own if t date. a large 77 At year .8% num -end ber of 2018 olde , 7 2 r 7 6. partici .56 % percent pants of ret 401(k ired. ) persistence-of-their-use-2007-2009-4871. 2 the individua least one plan l. T partici he impact of pant wi 1996 th a acco n outsta 2000 unt consolida nding loan. 2002 tio 2005 n v aried wi 2007th th 2008 e partic 2009 ipant’s ag 2010 e and t 2014 enure wi 2015 th the 2016 current emplo 2017 yer. 2018 >80 PercenP t ercent Chan >g 6e 0 itn o T 8o 0t a P l e R rc ee tu nrtn Index > e4 s0 to 60 Percent 24 50s crisis (year 36.9% allocation, t 5- .8 end % 20 ha 4 07 .2 t the fun % ), and3 mo d pro .7% st h vider adjus a 2d .5 the majo % F ts ig 2 t .u 1 o b % re riecom ty o 2 1f e .9thei % lessr a focus 1 c.counts 4% ed on inv g 1.r 6owth a %ested in e nd mo 1.8% qu re it foc i3 es. 8used .1 % For on A target-date fund typically rebalances its portfolio to become less focused on growth and more focused on income as it approaches EBRI/ICI Thu Th se posi , agg 401( rtive co egak) te f D rrelati igu atabas res in on betw e ................................ this re een tenu port gen re an erally shou d acco ................................ unt balan ld not be ce is expect used to ed beca ................................ estimate time use long - trends. R term emplo ................................ ecord yees s w ha ere ve e ha nd mor crypted ...... e time 6 Figure 8, Percent Change in Total Return Indexes ................................................................................................ 22 .. 13 31 Age and account balanc1996 e are positiv 2000 ely co 2002rrelate 2005 d amo 2007 ng partici 2008 pants 2009 covered 2010 by the 2014 2018 databa 2015 39 s2016 e. Exam 2017 ination 2018 of All United States, March 20 16%18. 14% Washin16% gton, DC: 13%U.S. 12% Departm 16% ent of 15% Labor, Bure 14% au 11% of Labor Statist 12% 11% ics. Availabl 9% e at 10% assets In iad n the ditio data n, ch base anges wer in e tihe nves sample ted in of tar rge ecor t-date dkee fpe und rs and s, up f chang rom es in 25.3 the perc set of ent in p 2017 lans f . or wh Among pa ich they rticipants keep recor in th ds eir In 60s the 2018 39 E .0BRI/ICI % 5 401(k .6% ) d 3atabas .9% e, 388 .5% percent 2.4% of participants 2.1% wer 1.8% e in pl11 ans of 1.3% fering loans. 1.4% 1 .6 Ho %wever, 3 rel 7.5% atively few The largest increases in average account balance occurred among older participants with fewer years of tenure. For example, and passes 20 the target date of the fund, which is usually included in the fund’s name. income as the fund approaches and passes its target date. 37 example, about thre Dis et -qu rib art ut ers io of n o partici f 401 p( ants k) P in latn heir s, t P wen artti ic es ha ipad nt m sore than , and A 80 ssp eercent ts of their 401(k) plan Holden, Sarah 1S&P , Jack Va 500¹ nDerhei, and Carol Quick. 2000. “401(k) Plan Asset Allocation, Account Balances, and Loan to accumulate an account balance. >2 Ho 0 to wever 40 P, a ro ercenll t over fro >0m a pre F tio g u 2r 0e P 2 vio e2 rcus e ent mployer’ Zes plan ro could interfere with this positive be A llFo forr a compl e inclusio et n e time series o in the d18% atabas f th e 18% e percen to conc 17% eal tag the e of eli 19% identity o gible 18% 401(k) partic f empl 18% oyers ipants wit a 21% nd employe h outstan 21% es, 20% b ding 401(k) l ut were co 18% d oans a ed 19% so t nd loan amo hat 19% both coul 19% unts d U.S. Departm A ta ent rgetof -d Labor, ate fund Em typipl caoy lly ee Ben rebalanefi ces ts i S ts ecurity portfolio Administra to become ltion ess . 2 foc0 us 15 ed c. o n Privat growte h Pe annsion d morePlan focu B seullet d on in, Abstract of Em Allployee Ben 35.1% efit Researc 4.4% h Inst 3.2itute. % 22 018 .8%. “Histor 2.0y of % 401 1(k .7% ) Plans: An 1.6% Updat 1.2e.” % Fast 1 F .4acts % (N1 ov .6% ember). Was 44.8%hington, the Sources a ww ge w.b com and ls. pgov osT ition ypes of /ncsof /eb acco D s/b ata e unt balanc nef ................................ its/2018/emp es finds loy that ee- 54 be ................................ ne pe fits rcent o -in-thf partici e-unitepan d-................................ stat ts es with acc -march ount balanc -2018.pdf ................................ . es of less than . 6 twenti Age can G es, rou also 50 p. 5 influe percnce ent th of e th ceir hange in ag 401(k) ass gre ets gate wer averag e invest e acco ed in tar unt balanc get-date funds e. Thus, to ascert at year-eain what nd 2018; among is happe p nin art g ici to pan ts partici among pa Note: Fu pan ndrtic ts s m in ipants in th cade us lude mue tuo a eir six f l fthi und ss ties w b , orro bank ith tw wi co ng pr lleo cto ivivilege r fe e tru wer yea sts ,— lif ewhic rs of tenu insuh rahas nce re, the a sbe epe an ratth e e vera accas coge account ue for nts, a t nhe d an 23 balan y py oears olce increa ed that invest m the sed 3.9 percen entdatabase product pr ihas m t wi arilth y accounts inv 1P 63 e 8 est r.c 2eed nt in age eq ou f ities Elig at ible year 401 -e ( 7k nd ) P2 a01 rti8 c,i u pa pn ftrom s W les ith s 4 than 01(k) half Loan of s pa byrticip Plan ants Siz ie n , 2 their 018 twenties at year- Fi Ag geure G Act ro 9, uivity p Snap in 19 shot of 98.” IYnves ear-tm End en 401( t Company k) Plan In Acc stitute P ount Bal ers ances pective ................................ 6, no. 1 (January), an ................................ d 20EBRI Iss 18 2Formue Bri 5500 ef, n ................ o. 218 15 co End rrelati not on becaus ies nP co e m rce e a e a r s n tita a ol g plo e pr ver oo a9% f c h p co els a uld give a n an s, d p p aa ssre tsh isci ort th p ea - tenu tn artgs, ered em t a da n td e oa plo f sse thyee e futn a h s d,b w igh a yh n icu h cco m is b uun s e ur t balan a lo lyf ip ncla ce. lun de T p dhere a inr tth i is so ci e fp un a dme discernibl n ’st s, na m 2e 0 .18 e evidence be as a tra percenta cked by g e of the re researchers main oving 401(k) pl er multiple ye anars acco . Data unt balan prov ce, ide see Hol d for eac den h pa et al. rtici 2013 pant . included date of birth, from which an Year-End 2018 Snapshot of 401(k) ParF ticipants’ Ac igure 15 count Balances 2013 Form 5500 Annual Reports P e(rVersion centage 1.0). Was of Accounthin Bag laton, DC: nce Inve sU. ted S.i n Dep Tarartm get-Dent ate Fu of Labor, Em nds ployee Benefits DC: Employee Benefit Research Institute. Available at www.ebri.org/docs/default-source/fast-facts/ff-318- 12 k-40year- $10,000 were 0 in their twenties or thirties (Figure 11). Similarly, 62 percent of participants with account balances greater inves6 t0 ed s in the security indicated. The tenure variable is generally y 14% ears working at current employer and thus may overstate years of in Agth e G 40 eir ro1(k us pixt )R p ies, ua ssrticip e 22 ll 20.09 ants 0 ²perce ’ acco nt of unt the bal ir anc 401(k es, a ) ass set of ets w co er nsis e inves tent p ted in articip tar ants get -mus datet b fuend an s.aly zed. trac the consol 20s ked 40 idati 21(koon o ) plan N f th on peir multi -arti target cip 30% ants -d ple acco ate b . At year 30%alance un28% ts. -end d fu Amo nd 2018 24% ng p s inc artici , 19 lude as 25% pan perce ts in their fift snt of et all 29% tho ocat 26% sion, e ies eli or si or hybri gi24% ble for l xties w d, fun 26% oans ith more than ds an had 25% 401( d lifesty 3 k) 23% 0 y p le lan ears fund loans 21% of ten s. ure, the 24% About the EBRI/ICI Database ................................................................ Figure 13 ................................................................. 7 end 2007. GICs are Ov guaerall, ranteemo d inr ve esth tman ent9 c0 on pe trarc ctent s. of 401(k) participants had at least some investment in equities at of ro Age ( llover a Februassets a ry). Available at mong the p w artici ww.ici.org pants wi /pdf th a/per06 ccount balan -01.pdf ces grea and ww ter tha w.ebri. n $ org/cont 100,000, as ent/ 3 percen 40121% (k)-pl t o an f th -asem ha set-allocat d twoion or fewer - Average Asset Allocation of 401(k) Plan Accounts by Participant Age age group is assigned 100 ;o d r at Fe e o wef rhire, from 101 whi to 5ch 00 a tenur5 e 0ran 1 to ge 1 i ,0s0 ass 0 igne 1d; ,00 outs 1 totan 5,0di 00 ng loan b> ala 5,0 nce; 00 funds in the U. S. Security A 5De 0spartment dmiof nistr Labor, ation (Se Bureau ptember) of Lab. Avail or Statis abltics e at . 2019. National Compensation Survey: Employee Benefits in the 38 pa 20s rticipation in the 401(k) p12% lan. 11% 10% 11% 10% 10% 13% 13% 11% 8% 8% 8% 8% 50%5nov18.pdf. than $100,000 were in their fifties or sixties. The positive correlation between age and account balance is expected 30s In plan year 2018 (latest data a 22% 20% vailable), 22% only 1. 19% 4 percen 19%t of th 25% e $5.2 tril 22% lion in 401 20% (k)18% plan asset 19% s were 17% participan 16%t loan 17% s. average account balance increased 3.0 percent with the consolidation of their multiple accounts. Future joint research with out Figure standing ( 10, Dist Fig ribu ure tion 24 of ). As i 401(k n pr ) P evious lan Acc yea ount rs, lBa oan activit lances by y varies Size o f with a Account Ba ge, tenur lance e, ................................ and account balance. O ................. f those 16 Note: Funds include mutual funds, bank collective trusts, life insurance separate accounts, and any pooled 401(k) Plan Account Balances IncF ro e rta ies se With P 1articipant Age and Tenure 1 year-end 2018. yea G30s rou rs of tenu acco 4 p 0s unt Ze -re bal ro, and 8 pe ances >0 - to and 1 20% rcent 0-loa >1 of them h 0 n19% - tactiv o 20 ity >2 18% ad b - 0in to -1 etween two 3998 0 20% >- 31 032 to . 4 0 20% an >4 d five 0 to 20% 5 yea 0 >5 rs of 0 t23% o 6 tenu 0 >re (see Fi 60 23% to 70 > 22% gure 70 to 12). 8019% > 80 to 9 20% 0 >90 20% to 100 19% Source: Tabulations from EBRI/ICI Participant-Directed Retirement Plan Data Collection Project 13.7% partici Fact N Fo Inves u r data m or pan bs Tha tm e on 401(k) pl r t’s ent oin f t A P ves Olptions affect 4 tm n P ent a an ................................ r ass tport i01 c17% ip et (k) folios; an a s, parti n tPart s ciici pan d as pants’ A ts, set valu an ................................ d plans es att ccou through nt Balan ributed 201 to t ces 8hos , see ................................ e fU un .Sds. An . Departmen account b t o ................................ f Lalanc abor, Emplo e for each yee Benef part ........... ici its pant 7 United States, Bloomberg March 20 Barclays U.S19 . Ag.g rW egas atehin Bongton, dPerce DC: nN ta uU. g m eS. b o e frDe ao cco fpa Prtm lu an nt P ent ba ar la tiof n cce i Lab pas, nts or, Bure 2018 au of Labor Statistics. Available at 40s ww Although w.dol. the gov/ average sites/dolg 16% accou ov/fi15% lnt b es/ebsa alance 16% /resea for 13% rchers the entire /stat 13% d ist atic abase at 18% s/retireme 16% year nt--b end ull 15% etins 2018 /p 13% is rivat 5.9 e-p 13% percent ension l 12% -o pl w aer n- b tha ull 11% eti n th nse - 12% • Company stock is equity in the plan’s sponsor (the employer). 18.2% Asse becaus t A e youn llocat ge ion and I r workers ar nv e est like me ly to nt Op have tilow ons er incom 38.8% es and to have had less time to accumulate a balance with their See Table D6 in U.S. Department of Labor, Employee Benefits Security Administration 2021a. 22% this feature wil invesl ex tmeplo nt p re the roduc lon t prim gitudinal aspe arily invested cts o in the f th seis co curity nsoli ind 24% idati cateon in mo d. re detail. participants in plans offering loans, the highest percentages of participants with outstanding loan balances were among 4 20s 40s 0%30s 3 In 8d .5 ex % ³ 0.9%22% 0.21% 7% 20% 0.8% 22% 0.8% 22% 0.7%22% 0.8 26% % 0 26% .6% 26% 0.8% 24%0.8% 25% 5426% .4% 25% 8 50s Average12% 401(k) 11% plan 12% acco 10% unt ba 10% lance 13% by par 12% ticipa11% nt age 9% and te9% nure, 2 9% 018 7% 8% G Security Admin ustman, Alanistrati L., and Tho on 2021m a as an L. Ste d 2021inm b. Fei or t er. 200 otal retireme 8. “How nt a Cha ssets (incl nges in uding th Social Sose i ecurity 30.1n 4 % Af 01(k) pl fect Ran ecent s) thro Retir ugh ement the fourt Trend h s.” 25 is the sum of the participant’s assets in all funds. Plan balances are constructed as the sum of all participant 21% balances ww abstr w.b act ls. -2 gov 013. /ncs pdf/eb . s/benefits/2019/employee-benefits-in-the-united-states-march-2019.pdf. 4.2% average account balance at year-end 2017, this is affected by participants 3.9 an %d plans entering and leaving the 50s Because 4 So01(k urce) pl : Taan bus w lati17% oere introduced about ns from 17% EBRI/IC 17% I Partic40 ip 19% 3a 2 n yea .4t% -Drs ire19% ago, cted ol Reder a t19% ire 35 m .1% e nd longer nt P 22% lan D- atenu ta 22% Co red em llecti23% onplo Pryee ojec 21% s may t n23% ot have p 23% articipated 23% Fi current 30s gDistr ure 20 s11 e ibutio mp , 3 P Age 9lloyer. .a n 1n % Composit of s P In lans, 1 .ad 8% di Partici ion tio n, of 1pan .they Se 5%lecte ts are , an d 40 1 ld .es 6As % s 1(k l sikely to ets ) P b 1lan .y Pl 5% h Acc an avo e S unt 1 irollov ze .2% ................................ Baers lance f 1ro .3 C % m a previous ategories 1.0% ................................ ................................ employer 1.3% ’s p 1.l5 a% n in ........................ the .................... 4 ir curr 8.3% ent pl an 16 7 1 to 25 3, 4 31.5% 39 partici • pan Mor ts in e than t their thirti hree es,- qu forties arter , or s o fif f 401 ties ((k) p Figure la 25 ns), co . In 27% v aer ddition, ing mo partici re than pants thr wi ee th f -qu ivear or fe ters we or years f 401( of k) ten plan ure or Inves 10 60s tment Company Inst B 10% itut alane. Quart ced 9% Fundserly S 10% upplem 8% enta 8% ry Data. Was 11% Ghin I10% Csgton, DC: and9% Inves 8%tment 8% Compa 7% ny Institute. 6% 7% 15.1% Year In th- e 201 End 7 EBR 2018 I/ICI 401(k) Snapshot of database, 86 40 percent of pa 1(k) 43.7% Plan 43 rtic .2%Lo ipants were in plan an Activity s offering loans. 43.5% This system of classification does not consider the number of distinct investment options presented to a given 43.partici 8% pant quarter of 2020, see Investment Company Institute 2021. For a discussion of trends between defined b 20% enefit (DB) and In in 360s 0th % any • N e plan. Pl BER Wor give Money f n 2y 6an ear, the .king 5%und s2ize 7 P .2s % i ap c s cha ons er, n est 2 9% 6.nge in 9 imated ist % o. of 14 9% those a partici 10 as 5 the (June). C f9% un s p ds um of ant’s accou de 10% ambrid signe active d ge nt 10% to ma partici ,bal MA anc intain : Nat pan 11% e its n ional Bur a stable in 7 th .2 12% the e% data p share eau la base i 13% n o an f p d, Ec sric t as such, ono he 13% e. s mic Researc um o 13% does f thr n ee fact 6 h. ot 14% .5 Available at % neces ors14% : saril y 14% 40s 4 P4e 48. .5 rc % 5% entage 3 .1 o% f plans2.2% 2.1% 1.7% 1.4% 1.4% 1.2% 1.4% 1.7% 39.2% database. Among the sample of participants who were present in the database in19% every year between 2010 and 19% in 401(k) plans for their entire careers. The Revenue Act o Median f 1978 age: 4co 6 ntaine years d a provision that became Internal R 25.eve 5% nue Code accounts. Account balance and tenure are also positively correlated among participants in the 2018 database. A The invest Age me Equnt op ity tio Tans tha rget-Datt a plan e Non-Ta of rgef t-ers Dat can e sB ign onidficantly affec Money t ho Ow partici ther Stablepan - C ts o all mpa ocat ny e their 401(k) assets. FiM gu em re o :16 with morpart e tha icipants, n 30 years inclu of tenure ded ta 54.9% were rgetle -date ss likely to funds in their use the loan inv p estment rovision than lineup othe at r p year artic- ip end ants2018 . Ten .pe At year rcent o -end f About C hanges in Account Balances ........................................................................................................................ 9 $18,942 21.3% U. but ra S. De ther th partm 10e t 0ent ypes of of o Labor, ptio 20% ns p Bureau resen of ted. Pre Labor Statis liminary tics resea . 2020. rch an N Ye ational aly arzing s of Com 1. Te 4 mil nu pernsat lie on participa ion Survey nts dra : Empl wn fr oyee om t Bene he 2fits 000 in the U. define 50s S. De d co partm ntributio 47.7ent % of n (DC) pl Labor, 3.7% an Em s, see Poterba, V 2pl .5oy % ee Ben 2.4efi % tsenti, Security 1 an .8%d Wi Administra se 200 1.5% 7; Ho $tion 18 1lden, B ,.4 4. 2 % 330 16 $rady 18 . 1 ,Private .1 22 , and Hadley 2 % 7 21. P 8% 1 en .4% sion P 006; Br lan Bulleti 1.7%ady and B n, 34 A .8 bstr ogdan 201 % act of 0 40 www.nber.org/papers/w14105. $17,686 20.0% Fi represe gure 12 nt th , Te e t nure otal Com numpositi ber of on of empl Se oy lecte ees d at the 401(k sponso ) Plan A r $ing 1 cco 7, 6 firm. Wit unt 30 Balanc hin e the Cate year gories -en ................................ d 2018 EBRI/ICI database, ................. it is 17 Years of Tenure* 2, 3 17% 3 $17,132 5 Secti Th20 on 401(k). T is pattern is 26 1 8 to , th 10 e 0ave driven he law went i rage acc 401(in part k) P ount lanto e nby re A balance ssff estric tect o s tio n Janu de ns p crea laced o ar sed y 1 by , 1980 n loan amoun only , but i 0.7 t was not until No percent ts. between year vembe $16 -en ,r 1981 73d 2 2$ 017 tha 16,8 a t pro 3 nd ye 6 posed regulatio ar-end 2018, ns 17% presents partici Inves Grouptm pan ent tt’s t he d Fu Co nenure dist mpany I s ribu w Fu tion it nnst h ds of aitut n em plans, e. Bpl a2 la oy 02 p ncer arti 1 ed . serv “Th Fu cipa nde U es as snts S R , and ass Fu a proxy etir ndsement ets for the Fu b Market, n y fo ds lur eng com V Fourt t ah o luebi f Fu h nations time nQuart ds a work of er St o 2 in c020 kves er h ” ( tm as fort ent O partici thcom hof erfer pin ated in t ing g U)s n. Availab k . nThe first own he 40 $16 le a E,q 0 1(k u 1 it t0 ie)s Y 2e 0a % rs of Tenu$ re 1 *5,246 16.3% 18.4% 70.5% 13 14 participan 20 ts1 wi 8, th account 27 percent bal of the ance 2018 ass s of Fets o l ress m i n 5 t 5 than $10 he 00 EBRI/ICI 40 ,000 had 1(k loa ) data ns outs base tand wer ine g.inves ted in target-date funds and more 60s 49.9% 3.6% 2.3% 16 2 .. 02 % % 1.6% 1.4% 1.3% 36.1% 1.0% 1.2% 1.4% 33.9% Avai •labil Stable A itge y and Use -G valu rou e p p roducts of 40, such 1(k) 0 to Plan 2as guara Loan > ntee 2 s to by P d5 inves lan Size tm >5 ent to c1 ontrac 0 ts >1 (G 0 ICs to 2 )0 and > ot 20her 41% to stable 30 -value >30 funds, are EB 0 tRI o 2 • /ICI 401( New kcontr ) database ibuti 74 15..6% 1 ons % sug 27% bgests th y th24% e par at the ticipant 27% she er n (23% +), the umbe 21% em r of investmen 13pl .7% oy 25% er (+), or b t 22% optio oth ns p 19% ; resen16% ted does not i 14.6% 19% nfluence pa 18% 15% rticipants. 17% and 2016 20 United 14 Form ; an States, d Brady, B 5500 MaA rch urh nnu am, and 2020 al Re . pW ort Ho as shin lden 2012 (Version gton, DC: .1.0). Was U.S. De hin pagrtm ton, DC: ent of Lab U.S.or, Bure Departm au ent of L ofabor Statist Labor, Empl ics o. Availabl yee Benee fits at $12,578 16 $12,655 16% poss Relationshi ible to 16% linp k in of di EBRI vidua /ICI ls a 4 cro 01s(s k) p D lans ac atabas ros e Plans s a maj to t ority he of Univers the recor e of dkee All 40 pe 1(k rs. This ) P 18la .1ns % improv ................................ es the identificatio ................ n of activ e 9 20s 0 $ t1 o1 23 2 ,600 26.2% 50.56% % 5% 3.2% 4% 5% 9.9% 7%Tw 0.e 6n % ti6% es 9% 1.4% 7% 1.6% 9% 4 8% .4% 7%2.3% 7% 74.7% 3% were issued (see Ho from $181,492 lden, B to $180,2 rady, an 51. d Hadley 2006; Employee Benefit Research In 12.0% stitute 2018; and U.S. Internal Revenue plan. Indeed, 70 percent of participants with account balances of less than $10,000 had five or few 24.er years o 6% f tenure, category All www.ici.org is th 480 4.2e % base /resear g 2.7 ro % ch/stat up, whi 1s./ 9ch retireme % consis 1.nt 9 ts % . of plans 1.5% that o1 ff.er 3% neither 1.3 c %ompan 1.y st 0% ock nor GICs 1.2% or 1.5ot %her stab 41.le 5% -value 15% >2 to 5 than half of 401(24% k) partici 25% pants 25% in the data 21% base h 22% eld tar 26%get T-h dat 23% irtiee fun s 20% ds. Also 18% known 19% as lifecy 17% cle fun 8.15% 7 ds, these % 18% 15% 7.8% 27.9% 20s $4,160 $11,705 $19,5 6.1 0% 3 7.5% On av G 1ust 0% man erage reporte , Alan , partic L., and Tho d ipants h as one av cate m e as 10.4 disti gory. L. Stei nct op nmeier. 201 tions b3. ut, o “En a ffects vera 2% of ge, cho Social ose o Security Po nly 2.5 (H licie old sen a on B nd ene Vafit nDCl eraiming hei 2001 , Rb). etir In ement, Fi 30s > g2 ure tww o 513 w.b , 3 4 ls. 301( .8gov %k)/ P ncs lan /eb 40Acc .6 15% s % /b ou e6 nef nt Bal .514% % 15% its/2 4 a.nces I 30 % 20/emp 12%ncreas loy 14% 5.ee e 3% W -be ith 15% ne P Ffits iarticipant g 1u .- 0 rin e % 15% -1 th 7e- Age unite 17% 2.4and d %-stat Tenure 18% es-marc 3.2 ................................ % 19% h-2020.p 17% 8.5% df. 18%0.9% ................. 18% 75.17% 0% 17 Security A 101 to 2,5 dmi 00nistr 5.9% ation (September). Available at 5.2% 23.8% 36.8% part 2 icipants and resulted in the reclassification of 0.5 million 4partici .9% pant accounts that were multiple accounts owned by Service 1981). Percentage of Acc4ou .2% nt Balance Invested in Non-Target-Date Balanced Funds 3.5% > Before 2005, the U 5 to 10 .S. Dep 23% artmen 21% t of Labor 23% private pen 19% 18% sion plan bu 24% lletins r 11% 20%eported a co 19% 16% unt of a16% ctive 401(k) pl 15% an 13% participan 15% ts fun whi Age ds. le 72 T awen nd Te perc ty enu -nt of eire of gh p t pe artic 401(k rcent ipa ) of nts Pl an w partici ith Parti accou pan cipa S tsnt int b x itn s ie ................................ s th alances e 2018gr EBRI/ICI eater than $1 401( ................................ k) 00 d ,0 atabas 00 had 2e .6 were i m % ore than n ................................ these 10 ye plaars ns, of w te hicnure h ge ....... nerally 11 Average Loan Balances 2.1% • Total investment return on account balances (±), which d 1.e 4% pends on the performance of financial markets and 40s >5 to 10 fun 42 ds .1 are % desi 28gn .4 24% % ed to of 23% fer 3.8a d %21% iversifie 22% d p 6.2% ortfolio 23% 1 th .7at a % 23% utom25% atically r 3.8% 27% ebala 4.8 nces to % 26% b24% 8 e .2mo % re f 26% ocus 1.0e %d 25% on incom 71.25% 2%e 30s $10,401 $22,982 $41,954 0.5 $ % 67,012 Fi additi fty- and ton, hree the p Savin perreli g.” cent of mi NA na BER Wor s th ry a see tna A 40 lly lking 1(k o sis found th ca ) P p tio ap 6 lans n 4er, n . 4 to % for at E o. q 401(k) partic whi 19 uitch i07 es l 1 oan (May Var d ie ip at )d an . Ca a w W ts are imbridge, MA: er de e ly ava not n Am ilable i a oive ng — n N 4 th ational B 0 that is, w 1e (k2 ) 018 Pla ure hen n EBRI/ICI P au given arof tic Econom i 401( p n 0a .0 opt n 1% ts k) ioins, they d c Re atabas searc do no e of h. fere t d 28% www.dol.gov/sites/dolgov/files/ebsa/researchers/statistics/retirement-bulletins/private-pension-plan-bulletins- Age 60 s >ing 10 tle o i 2n 0dividuals. This proce 15%dure 14% allows E 16%BRI 22%13% and ICI to 13% begi17% n to cons 16% olidate 14% accoun 12% t balances 12% for 23.0% 11% individuals 9% acros 10% s Mitchell, Olivia 24 S., and Stephen Utkus. 2012. “Target Date Funds in 401(k) Retirement Plans.” NBER Work 2ing Pa 3.6% per, no. Rel 0%ationship of EBRI/ICI 401(k) Database Plans to the Universe of All 401(k) Plans that h >10 tad be o 20 en adjusted from the n 27% 26% umber26% of active p 26%artici26% pants actua 26%lly re 29% ported in the 29%17. Fo 2% 28% rm 5500 27% filings 29% to exclude 29%(1) 29% ( 26 50s Figure 12)4.1.0 E %xamining t 23.7%he interact 4.8ion % of both 8a .2ge % and tenure 2.8% with ac 6.5 count % balanc 5.2% es reveals that, 7.0% for a 1.0 given % age 62.5% offer equity fu 19.nd 1% s, bond funds, money funds, and balanc 28.4% ed funds as investment options. Another 46 percent of • Other is the residual for other investments 36 , such as real estate funds. Fi g At yea ure 14 ron the ov -,e 4 nd 2 er time. 01( al 018, 57 percen k) P locat lan ion of Assets ass Are t oets f nConc on in- an target ent individua rated in E -date ba l’s la qu account nced ities mutu ................................ ; aal fu nd nd assets were assu ................................ med to be invested i ..................... n equities (see 19 U. S. Departm 40sent of Labor, A 28% sse Empl t$ a 1 oy l9 lo ee Ben ,5 ca 80 tionefi dits st $ S 3 ri6 b ecurity ,u 3t0 io 4n oAdministra f 40 $1 6(4 k) ,4 p 9a 7 tion rtici . 2 p$ a 01 n 12 1 t a 8 a. ,cco 0 Privat 69 unt e ba $ Pe l1 a6 nsion n6 ce ,3 4 to 1 Plan Bulletin, Abstract of Year divide their ass Grou-p 2 En ,5d 20 01 Zte o 1r 8 o 1 ets among a 0 Sn ,0apshot 0 >0 0 to 1 o 0llf 401 n >1 . Indeed, l 0 t( o k) 2 P 0 artic >2ess th 0 tipa o 3nts 0 an> 1 p ’ 3Acc 0 tercent o ount 40 > Balances 4 of partici 0 to 50 > pan ................................ 50 ts fol to 60lowed a 1 >60 to 70/n > 7ass 0 to ................................ et allo 80 >catio 80 to n 9 strategy 0 >90 to . 1.......... 00 12 a p >20la tAv o n 3ailab loa 0 n pr le at ovision to par www.nbe 11% r.or ticip g/paper ants 10% (Fi s/w19 g 11% ure071 21). 9% . The 8% loan feature 12% w 11% as more comm 9% 8% only ass 7% ociated 9 7% with larg 6% e plans (as 7% 36.5% abstract-2014.pdf. >20 to 30 25% 26% 25% 24% -2 24% .0% 25% 27% 26% 26% 25% 27% 28% 28% data 60s provid 3ers 5.7% to provi 22de .9% a more accurat 5.0% e estimat 10.6e %of average 3.0% accoun 10t b .1% alances 3 pe .9r % individu 7.al. 8% 1.1% 52.3% 17911 (March). Cambridge, MA: National Bureau of Economic Research. Available at individuals eligible to participate in a 4 19.9% -4.201(k) % plan who had not elected to have their employers mak -4.4% e contributions; and (2) partici group,pan avera ts w gere e acco in plans t unt balh aat off nces ten er GICs d to incr and 1 eas other e with sta t benure. le-valu F e fun or exa -ds as an 4.4% mple, i tnves he av 2 tm erent age acc option, in ount balance addition ofto the base 20s 94.2% 1.5% 0.9% 0.5% 0.2% 0.2% 0.1% 0.1% 0.1% (*) 2.1% Am Inv >30estmen ong partici 50s t Co 40pan mpan tsy I with nstitute, Q o 7% utstandin $ua 3 8% 0rterly S ,4 g7 401( 510% uk) pplementary l $oans 48% 9,0 at 93 th 7% Deata). e$ n8 d All 0 9% of ,7 oc 8 28 at 018 ion 9% , to the $ equ 13 aver 67% ,iti 70 es in targe age 1 unpai 6% $23td balanc 8 -date fun ,8 6% 98 e was ds is ass $ 5% 30 1$ ,8,162 8umed 65% 3 , to va 5% ry -10%2005 Form 5500 Annual Reports (Version 1.1). Washington, DC: 17.6% U.S. Department of Labor, Employee Benefits Bri >ghtS 31 099co 6 pe an 19d In 99 ves2 tment C 00 13% 2 ompan 2 16% 007 y In 15% 2 stitu 008te 2020 17% 201 reports an a 0 17%201218% verage of 20119% 3 28 inv 2019% 1estmen 4 218% 0 t 1 opt 5 ions in 2 17% 2016017 a 19% 20 nd an av 17 21%2er 01 ag 820% e of measured by the number of partici epan quitts ie in s the by a p gla en). ; peMo rce re tha ntage n o90 f p pe artricent of ci 29p .0% ants, plans 201with 8 more tha2 n 01, .900 % 0 participants All 39.0% 26.6% 4.6% 8.1% 2.4% 6.3% 4.5% 7.6% 1.0% 63.1% 9.7% 15 Factors That A 7.0% ffect 401(k) Participants’ Account Balances ................................................................................... 12 www.nber.org/papers/w17911. 19.0% nonv 30s ested f 8or 9.9 mer emplo % 2.5% yees who had n 1.6% ot 0. (at the time the 9% 0.4% Fo 0rm 5500 .3% 0 fili .2ngs % were subm 0.2% itt0 ed) i .2%ncurre 0.d the 1 11. %2% break 3.-6in se % rvice The • • 2018 W Unk EBR ithd nown I/ICI 40 rawa , ls whic (1 -) (h , b k)is th data orro e final wi base i ng (category - s) a , and loan representativ , co re nsis payments ts e of sample ass ets (+) of t. t hat coul he estimat d not edbe univ ide ers ntified. e of 401(k -1 1 .0%) plans. At year-end Fi partici gure • pan 15 40 ,ts Av 1(k in e the )rage pair rticip sixties Asset ants Allo with u ’ inv cation of est p ment in com to two y 401(ears k) Ppa lan ofny sto tAcc enur ou ck e nts continued at was by $46,4 Partici 57 p, compare h ant Ag istorica e ................................ lly d wi low th lev $30 els. 6,214 Five for p perc ....................... artic ent ip ofants 401 i (n k) 19 options. >10 Alter ,000natively, 12 percent of participants were in plans that offer company stock but no stable-value products, com Ho with in ldpare en, ves Sarah d wit to 60s (r age peh r, Pe c$ e. Asset all 7,935 nter t of B p ra lin an dy, oca t sh )e and tio year $ n to equiti 4 M 6-,ichae en 45d 72017 l e H s for target adl $ data ey. 60,1 base ( 2006. 61-dat “401 Fi e f gure $ un 8(3 k) ds was ,26 5 P 9)la 6 . ns: Th ba e A 2 sed on M me $15 1 di - 8Yea an ,83 l orni r R 9 oan et ng b ros star a $ ala 1pe 9 18. nce 7ctiv , 2% na 3 outst 2lysis o e.” 6 In and fves $ target 3in 0tm 6 g was ,2 ent 1- 4 1 date fu .8 4 %Com $4,48 nd pan 6 y at 1 U. 21 inv S. Security A De estmen partm t ent opt dmi io of nistr ns whe Labor, ation (Ma n a Em target plrch) oyee Ben -date fu . Available efi nd s ts S at uite is co ecurity www.d Administra un ol. ted as gov/sites a s tion in/gle i dol . 2go 0 nv 18 v/fil estmen a. es Privat /e t o bsa/re e ptio Pe n. nsion s earchers Plan/stat Bullet istics in, Ab /retireme stract of nt - 3.8% 9.1% included a loan provision, compared with 12.7%30 percent of plans with 10 or fewer participants. Participant loan activity Percentages are dollar-weighted averages. -20% 40s 88.8% 37. .4 9% % 2 7..9% 3% 1.4% 0.6% 0.4% 0.3% 0.1%7.1% 0.1%27% 0.1% 2.4% Size of Accou20 nt Balance 25 perio Size o d estab f Accoun lits hed Balan 2. by th c 4% e eir plan, but were unable to make the adjustmen 6.3% t in 2005 and later ye 1 ars (see U.S. Department of 2018, all 401(k) plans held a total of $5.2 trillion in assets, and the database represents about 215. pe 3%rcent of that assets were invested in company stock at year-end 2018, in line with recent years. This share has fallen by 74 their whi Def le th siinition xties e rem wi of aini th more 401 ng (k) 15 P than pe lan rc Acc ent 30 y ount Ba of ears part of icipa lance tenure nts ................................ w (Fi er ge ure in p 1lans that o 3). Similar ................................ ffly, t ered he both aver comp age ac any st count ................................ ock bal and ancs e o table f pa -val rticip ue.......... ants produ in cts 14 asset allocation (see Mornings 2018 tar 201 EBRI8 an /ICI d P n erot ce e nt 34 age for additi of Accou onal di nt Bascuss lanceion Inv ). e sted in Equities yearInst -end itute Res 2018 Note, compare : Te harch P e averers d wi age pe th acti c$ c ve 4,293 ou 1 n2, t b ino. a n la the 2 (N nce year a ov member). A -o en nd g a 62 .l801 l% 17 4vailabl .data 6 mibase. lle io at n 4 T ww 0h 1e ( w.ici.org kratio ) pla of n p /pdf tahe rti/per12 cloa ipa n nouts ts -0 w 2.p ta as df nd $ . in 7 3 g ,6 to 7 the 2; 2 bulletins/private-pension-plan-bulletins-abs 4.trac 7% t-2005.pdf. 2015 Form 5500 3. A 0% nnual Reports (Version 1.0). Washington, DC: U.S. Department of Labor, Employee Benefits var 50s ied modest 86.5% ly by pl 3.an 7% size, ranging 2 3..9% 6%2.5% from 1.8% 15 per 0.cent 8% of p 0.artic 6% ipants 0.4 % with loans 0.2% outstandin 0.2% g in 40 0.23. % 1(k 8% ) plans 3.1% with 26 to 11 A < $ ta 1r0 g,e 0t0 -0 date fund ty1. p5% ically re 12% balance11% s its portf 4. o 11% 3% lio to bec12% ome less11% focused o 12% n 5. g0% rowth16% and more 16% focused 13% on incom11% e as it ap10% proache5. s 7% 10% and pass10% es Mor < 1 $10nin ,00gstar 0 . 2018. Mornin 39% gstar 39% Lifetime 37% Allocat 35% ion In36% dexes (J 39% une). Ch 39% icago: Morn 5.1% 35% ings 42% tar, In 38% c. Avail35% able at 32% 35% 17 26% Forties 4.7% The chan Fi g Th ure e as 16 sge ,et allo Dist in an ribu catio y i tion nd n pa ivi of th th du 40 al1(k a p t the targ artic ) Plans, Pa ipant et’s -dat rticipants, acco e funt balan und fol alo nd As ws ce i to s n shift its focus f ets the b y Inv database i estment O rom s inf grow luen ptioth to i ced by th ns, 20 ncome o 18 e ................................ ma ver gn time i itude of s typically these .. 20 La Dist bor, ri Emplo bution yee of P Benef lan its Sec s, Par urity Administratio ticipants, and Asset n 2 3.4% 012a for fu s by P rther de lan Size tail). This change in methodology results in a dramatic AA ge ccount balances are participant account balances held 3i.n 1 % 401(k) plans at the participants ’ current employers and are net total. The database also covers 25 percent 2.2% of the universe of active 401(k) plan participants and 16 percent of all their for -30% ties perce wint sinc th up to t e 199 wo 9 whe yearsn of co tmpany sto enure wasck $19,58 accounted for 0, compare 19 percent d with $16 of 6, a 341 ssets fo.r p articipants in the 2.3%ir forties with in addition to the base options. Target-date funds were available in 79 pe 3.2% rcent of the 401(k) plans in the year-end 2018 remainin 60s $10,000 tg o t$ 8 a h 2 6cc e 0 19. .5 ,0 ount balanc m % 2% 00 edian 3. 5 a % c 26% ce ou increas n2 t .23% b 4% ala ed nc s e 22% ligh 1 w .8a % tly, s $ f 1 26% rom 60 ,0 .91 % 9 0 .pe 25% Ar ccent at c 0o .6u % n 26% t b year ala 0n .4 -28% c e % e nd s a 2017 re 0 29% .p 2a % to rti c 10 ip 28% a pe 0n .2 trc % aent cc 26% oat u0 n.ye t 1 % bar a 26% l-a en ncd e3 2018 s.25% 3% (Fig 25% ures the target date 0 of the 0. fu 8% nd, which is usually included in the fund1. ’s9% name. 17.7% 27 $10,0Security A 00 to $20,00dmi 0 nistration (F 32% eb 32% ruary). Availab 31% 29% le at 30% 33% 31% 28% 24% 32% 31% 28% 26% 29% Size of 401(k) Plan Account Balances .................................................................................................................... 14 250 participants to 22 perce 26% nt of participants in 401(k 19 ) plans with 10 or fewer participants (Figure 22). Loan ratios — Fohttps: r year- //ind end exe 2017 a s.mo sset a rning lloc star. atio com ns, see th /resourc e appen es/PDdix F/Bro . chures%20and%20Fact%20Sheets/Mornin 13.2% gstar_Lifetime_Alloc 12.3% 1.2% 12.2% 11.5% three refe G ofr ou prred to as the g la pn factor loanss. r 18 R elative to e Zte irre li om de pa en the t th. sav iBecause d s n > tart 10. g 0s 9% t o h ing e 2l0 d acco P iiscussio n e rp clu e ant b nt ns ns of a aa 10. t> lance. p 8% 2r0 e v tsset a io ou 4s 0 Fo P ell m eoc r ex rp cati le ont am yon usu ers pl > e, o 4r 0 a al rto o ly focus on the lc l6 e ontributio 0 d P oe ve rc r e in nt to n Iof R >percenta A 6 a g 0 s ta o ive r8 e0 n n dollar P ge of the p oe t ric ne cnt lu d amo edort . unt produ >fol 80 io P inv erce es ces ntted a increase in th -33.e 8% number of individuals repo 9.1% rted as active participants in 401(k) plans; in 2004, the number of active 9.7% 32 8.5% 8.4% 33 Ho 40 A >l1(k l$ ld 2en, 0,)0 plans. 0 Sarah 0 to 8 8 $. 38 0% , and Da , 0The di 00 3.s 0niel S tri %26% butio chras 2 n .25% 0of %s ass . 202 ets 22% 11 .3 , p . % “D articipants, efin 27% 0 e.d Cont 6% 26% aribu nd pl 0.4tion %a 26% ns in Pla0 the n P .3 28% %articipants’ database 0 29% .2% Ac for 30% tivities 2018 0.2% is sim , 28% 2020 0.ilar 1.% ” 28% ICI R to the esear 3 u .27% 1nive %chrs Rep e o 27% ort f U. mo database. 3 >$S. 2re than 0 ,De 000partm to 20 $ 3Th 0,ent 0 years e 0s 0e of 1 pl Labor, 0 of a 0ns off t orenur F 28% eEm er w e. e ed pl r tar 28% oyee Ben get1-0 28% dat 1efi te ots f 5un S 0 25% 0ecurity ds to 26% 78 Administra 5 0 percent 1 to29% 1,0 of 0tion 0 the partici 27% . 201 12b. ,00 25% 1 pan Pr toivate Pe ts 5, in 0 28% 00 the nsion data 27%Plan base. >5,0 B 0 25% 0 ullet Amin, ong 23% Ab stract 26% of held in 401(k) plans at the participants’ current employers and are net of plan loans. Retirement 24 and 27). In addition, as in previous years, variation around this average tends to correspond with age (the older the Not all participants are offered this investment option (see Figure 16). 2 ww -37w.d .0%ol.gov/sites/dolgov/files/ebsa/researchers/statistic s/retirement-bulletins/private-pension-plan-bulletins- the -4 20s 0%amount of the 12.3 l% oan outstandin0 g divi .8% ded by the remain 1.5% ing account balance 3.0% — vary only sli 7.9% ghtly whe(n *) part 7icipa 4.6%nts Figure 17, Asset Allocation to Equities Varied Widely Among 401(k) Plan Participants ............................................... 20 ation_Summary.pdf. in eq T >h $e 30 uiti s ,0a 0es, the gli m 0 tp ol e $ 4o 0f, 0 p 0a 0 de pa rticipth generall an 25% ts chan 25% gy re es o flects the declini ve23% r time. 26% ng p 26% ercentage 26% of eq 28% uities in the 28% portfo 30%lio as it 10% 28% approaches a 29% 29% nd pass 28% es large partici 28 (*)Relationshi = • r l e pan g ss ro A tts increased h wth r a mi n 0 p nor .0 ate w o 5f p it Ag ey of 401 rchen e e to na t 53.1 mil nd Te add(k) ed nure to lion (new method) part a tos 4 icipants mall 01(k er account. ) Plan had loa from 44.4 mi Acc On ount Balances ns the outs oth llita on ( er han nd ol ................................ ing d d, method; see U . At invest year ment -end .ret S2018 . Dep urns of ................................ , 1 artmen 9 percent a gt iven perce of La of bor, all 40 Emplo ntag ........ 1(k e yee ) 14 >$30,000 to $40,000 23% 24% 25% 22% 23% 26% 25% 23% 24% 24% 23% 21% 23% The 2018 EBRI/ICI 401(k) database contains infN orm umat beion r o on f Pla90 n P ,9a87 rtic 4 ip0 a1(k nts) plans with $1.1 trillion in assets and 14.6 pl ans as Other resea (Feb rua repor ry 20 rch su ) ted by th 0. Available at 7 ggests th 201 e 8U.S at w .2 most 401( De 0 w0w.ici.org 7 partment 23.4 20 % 1 k) partici /pdf 8 of /20_rpt Labor 200 pan 7 (_recsurv ts do no Figur 201e 8 4). t mak eyq4. 20e activ 0pd 7 f. e cha 2018 nges 20 to 07 their ass 2018et allo 20 catio 07 ns d 20 uring any 18 2006 Form 5500 Annual Reports (Version 1.1). Washington, DC: U.S. Department of Labor, Employee Benefits partici 4 pants sa w vin ho were o gs held in ff er pled an tar s age t ptr-edat vioe u f s un em ds, plo 72 ye pe rs ro cent h r r5% olleeld the d over m at year into IRAs -a en red n2018 ot in.c T luar de ge d.t -T date fun he tenud reas sets participant, the lower the average), tenure (the longer the tenure of the participant, the lower the average), and 130s 9.1% 1.2% 2.2% 4.3% 12.7% 43.7% 70.5% G >I$ C 4 s abstr 0 ,a 0r0 e0 g act tu oa $ ra - 52 n 0t,015. e 0e 0d 0 in pd ves f. t m 24% ent contr 25% acts. 23% 25% 26% 25% 27% 27% 29% 28% 29% 29% 28% 42.0% are gro Source:uped Tabu o lan tio the ns b fro as mis o EB f R the I/ICs I iz Pe arof tic the ipanir t-D 401 irec (k) ted p R lae ns (as tireme measure nt Plan Dd a b ta y t Cohe numb llection Perr of plan oject participants). Among >T $h 4e 0 ,a 0n 0a 0l y to s i$ s5 i0 n,c0l0 u0 des the 14.22% 6 million21% participa 22% nts in th20% e year-e21% nd 2018 E 24% BRI/ICI 4 22% 01(k) dat20% abase. 21% 22% 20% 19% 21% the target date, which is usually indicated in the fund’s name. The target date generally is the date at which the typical produ Benefits S ce la ecurity Administratio rger dollar increases (o n 2018b). r dec As the reases) U w .She . Dep n com artmen poun t o de f L dabor notes: “In a p on a larger asset bas urely e e. Ass conomi et all c sen ocation also se and for research participants who were eligible for loans had loans outstanding against their 401(k) plan accounts, unchanged million partici -50% pants (Figure 1). As in the 401(k) universe at large, most of the plans in the database are small: given year. For example, 20s an ICI surv 3ey of re 0s cordkeepers co 40s vering more th 50san 30 mill 40 ion DC plan pa 60s rticipant a Acco ll unts found variable is generally years working at current employer and thus may overstate years of Year represe 40s >$5Security A - 0En ,00nted d 20 0 to $ 1 6 34 0 8 dmi ,0 Sn 8 p 0.0ercent 5apshot nistr % ation (Ma of 24% o t f 401 he as 24% ( rch) k) sets 1 P .9 . Available artic of %22% pl ipa ans off nts at 24% ’ As erin ww set All g 3 w.d 25% .1 s% uch fun ol. ocat gov ion 24% /sites ds i ................................ n t /d 25% heir inves ol6 go .8% v/fil 26% es tm /eebsa/re nt l 28% in ................................ eu s3 earchers ps. 6.27% 5% /stat 29%istics 29% /retireme ............. 43.2% 28% nt 18 - 5 acco Fi >$ g5ure 0,unt balan 00 18 0 to, $ Exp 60,ce (the 0os 00ure Lto e h sisE gh qu Th 19% er a iti the nes Increas $1 account 19% 0,000 20% e balance, t d Among 401 18% > he $4 19% l (0 o k) ,wer 0 P 00artici tt ohe av 21% $5 pan 0,0era 0 ts 0 21% ge Betwee ) (19% Fi n 20 gure 07 M 27 19% o and r) e. Overall, Th 2018 an 20% $1 ................................ 00 loa ,00 18% ns from 0 19% 401(k) p 19% lans . 21 Plan Sponso 2 r Council of America. 2019. 62nd Annual Survey of Profit Sharing and 401(k) Plans: Reflecting 2018 Plan Equities include equity funds, company stock, and the equity portion of balanced funds. those in p 200 la 8ns with 1,0 2009 00 or 2010fewer 20partici 11 pants 2012 , the loan 2013 ratio was 2014 12 20 p 15ercent 2 of 016 the r2 emainin 017 g 20as 18sets i2 n 012 9018, wh 2020 ile in inves A tarto ger for who t-date fundm tha typicat fu lly rnd is ebala designed nces its porwo tfoliuld reach o to becom retirement age e less focused on a gnd s rowth top making n and more focu ew se inves d on intments in come as it the f appround. aches and Ho purposes lden, Sarah , individua , Dan ls i iel Schra n these sgroups sh s, and Mic oul ha d el not be incl Bogdan. uded 2020 in the count of . “Ownership of active partici Mutual Fund pan s, Sh ts.” Ho arehol wever de, t r Sentim he form ent schedu , and le inf >lu $6ences 0,000s tince oinv $70 est 2 ,0016 0ment ret 0 . Loans outs 23% urns and cha 24% tanding ng 22% amo es iunte n as 23% s d to ets. F 10 24% or ex percent am 23% pl of e, sto the 25% ck rema s (as ining 25% measured by th acco 27% unt ba 27% lance, e S&P o 29% 5 n 00 tot average, 29% al ret at urn year 28% - 50s 8.4% 3.2% 5.1% Age Group 29.0% 36.1% 18.2% 64 that pe 10.6 rcent percent of D of the plans C plan p have 2 artici 5 or pan fets chan wer participants, ged the ass an et allo d 23 catio perc n of t ent heir account ba have 26 to 100 partici lances in pan 2020 ts ( an Fig d ure 6.3 2). I percen n t >$60,000 toS p $o a 7u 0 rt,ri0 c c 0 e i0 p s:a t Tia ob nu ila nt 16% ito h ne s 4 fr0 o17% 1 m( k E ) B pR la I 18% /n IC . I Par16% ticipant- 17% Directed 19% Retirem 19% ent Pla17% n Data C 17% ollection 18% Project 17% and U.S16% . 17% bulletins/private-pension-plan-bulletins-abstract-2006.pd f. U. NoS. te: De Fun partm ds inclent ude m of u Labor, tual funds Em , bapl nkoy coee Ben llective tefi rusts ts, S lifecurity e insuranAdministra ce separate ation ccou . 2 nts0 , 18b. and an Pr y ivate Pe pooled invnsion estmenPlan t prod B ucullet t primin, ari Ab ly ins ve tract sted of in tended to be small, with a sizable majority of eligible 401(k) participants in all age groups having no loan outstanding at passExperi es the tence arget .d C athicag e of the o: fu P nlan d, w S hic ponsor h is usu Cou ally inci nclul dof ed America. in the fund ’s name. 1 to 1Changes 0 11 t i on 2 Ass 5 et All 26 toocat 50 ion 5 1Betwe to 100en Ye 101ar to- End 250 2 20 517 an 1 to 50d 0 Y 5ear 01 t- oEn 1,0 d 20 00 18 1,0 ................................ 01 to 2,501 to 5,0............................. 01 to >10,000 A ll18 Pl ans pl > ans $70,with 000 to mo $80re tha ,000 n 5,000 26% partici 23%1 pan 1.3ts 22% % , the lo 22% an ratio 23% was 10 22% percen 24% t (Figure 24% 23). In 27% the 23 26% years that 28% the 28% database 28% nee 60sded to make the 11.5% adjustment is no lo 4.7% nger required. Si Usi z1 e8 o .ng Na 2 f % Accotio unna t Bl C ala omp nce 3ens 6.8% ation Survey da1 ta a 5.1% nd historical relati 13.onships 7% index) Us e decreas of the ed Int by ernet, 4.4 pe 2020 rcent .” ICI Re during sear 2018 ch , Pers whilpe e bon ctive ds (as 26, n measur o. 8 (Nov edember by the Bar ). Availa clays ble Cap at w ital ww.i U.S ci. . org/ Aggregat pdf/pe e Bo r26nd - 12 >$70,000 tend o $802018 ,000 , up 1 p 16% ercent15% age poin 16% t from ye 15%ar-en 16% d 2017 18% but still belo 17% w 16% their h16% istorical a 16% verage 16% . Loan 15% amounts 16% chan contr the se ged the as curt, less ityD ine as dp ic a than aset allo rtte m d.e n 1t pe o catio f L rce ab n o n ot of rf thteir co he plans ntributio have more ns during tha 20 n 20 2, (see Ho 500 part lden an icipand S ts. How chrass ev2 er, p 021). art Ana iciplyzin antsg 2019 and ass data ets, Al are ling, 1Source: Tabulations from EBRI/ICI0 P .2a % rticipant-Directed Retirement Plan Data Collection Project Fi g Lifes ure tyle funds 19, Asset All maintain a ocation pre Dist determined risk leve ribution of 401(k) P l and ge articipannt Account erally use wo Bal rds su ance ch as to B “co alanc nsed erva Fu tive, nds ” “mode by Agerate,” o ................... r 22 1 Note:20 Fu 1n6 Form ds includ 5500 e mutuA alnnu fun 0 dal .s 6, R % ba en pkort cos ll e(cVersion tive trusts1.0). Was , life insuran hin ce g ston, DC: eparate ac c U. ouS. nt s 2 Dep ,, 5 a0 n0 d artm any ent po5 o,l0 e od 0f0 Labor, Em investm1 e0 n,t0 p 0rpl 0 od ouyee B ct prim ene arilyfits >$80,000 tP o a $r9 ti0c ,0 ip 0a 0nts inclu 23% de the 23% 14.6 mill21% ion 401(k21% ) plan pa 23% rticipants 21% in the y 23% ear-end 23% 2018 EB26% RI/ICI 4025% 1(k) data 28% base and 28% 28% all. 2 For example, 92 percent of participants in their twenties, 75 percent of participants in their forties, and 86 percent The S&P 500 is an index of 500 stocks chosen for market size, liquidity, and industry group representation. has been tracking loan activity among 401(k) plan participants, there has been little variation. At year-end 2018, 19 A >$ ll80,000 to $90,009 0.7% 14% 14% 2.3% 15% F 14% ifties 5 14% .7% 16% 16% 14.8% 15% 14% 2315% .6% 14% 14% 43.8% 15% and trends evident in the Form 5500 data, EBRI and ICI estimate the number of active 401(k) participants to be about 59 08.pdf. Index) Sou As rcs eet All : T w aalso ere fl buocat lat e ioat n dio sge ( fn rFi o d m an gu ure E p d B a P R sarticip I /bi 7 ICt i Ia P nd n arant Ag 20 t i8). cip 1a 8 n. t-e D ................................ irected Retirement Plan Dat................................ a Collection Project .................................................. 18 U. Cla S. rk, an Departm d Stinent nett 202 of Labor, 0 reported that 7 Employee Ben perefi cent of DC plan ts Security Administra participan tion ts made . 2012 partici c. Privat pane t-direct Pension ed exchan Plan Bullet ges wit in, Ab hin th stract e of concentra 2 >$90,000 tte o $ d i 10n 0,0lar 00ge pla 22% ns. For exam 22% p 21% le, 61 pe 20% Nu rc ment ber o o 22% ff partici Particip20% apan nts its n ar P23% lan e in pl22% ans with 25% more t 25% han 2,50 27% 0 part27% icipants27% , and “aggress ive” in their na the 21.8 millionme to i 401(k) n pdicate the f lan participau nn tsd’s in risk level. the year-e Lifes nd 200 tyle fu 7 EBR nd I/Is g CI d ene atarally are inc base. luded in the non-target-date Poter 1 ba, James, Steven F. Venti, and David A. Wise. 2007. “Rise of 401(k) Plans, Lifetime Earnings, and Wealth at The R Security A ussell 2000 Indmi dex m nistr easuation (De res the perform cember) ance of the . Avai 2,000 l sabl malle es at t U.S. companies (based on total market capitalization) included in the Russell 3000 Index (which of participants in their sixties had no loans outstanding at year-end 2018 (Figure 28). >$90,000 to $100,000 13% 13% Plan13% s 13% 41% 13% 15% Partic 15% ipants 14% 13% 13% A14% ssets 13% 13% Equities include equity funds, company stock, and the equity portion of balanced funds. Funds include mutual funds, bank collective percent of 401(k) participants with access to loans had loans outstanding, the same as the 1996–2018 average mil lion in 201 2 8. The estimate of the number of active 401(k) plan participants is based on a combination of data from U.S. >$100,000 to $200,000 22% 20% 19% 18% 19% 18% 19% 19% 23% 22% 25% 26% 25% Figure 20, Asset Allocation Distribution of 401(k) Participant Account Balance to Balanced Funds by Tenure .............. 23 acco t(r* a)c k =s un 20 lte hs e t, 0 s 3 7 Form in li ,t 0h 0a 0 n ne with recent prior years. Furthe la r0 g.e 5 s5500 tp U e .S rc . e cA n om tnnu panial es R ). eports (Version rmo 1.5). Was re, Choi e hin t al. gton, DC: 2001 foun U. d tha S. Dep t 401(k) p artment artici of Labor, Em pants rarely ma ployee B de cha ene nfits ges thes Soure ces : ame Tab E uq p la utilito ans acco ie ns s firn oc m lu E dunt e B R eIq f /Iu C o itIr yP 65 fa urn t id c ps iercent p,a c no t-m Dip r o e ac n f ty eall ds R t plan oe ctk ir,e m aas n ed ns tt et h Pe ls a . Be e nq D ua itcaus ty a p Co ore ltle i mo o cn ti o os n f t of b Pa ro la je n th c cte plans ed funds h . Fu ave nd a s is nmall clude numbe mutual r of balanced fund category. trus As ts ww Retireme s , et All lifw.d e ins ocat ol. urnt.” a gov/ nio ce n N s san BER Wor ites/dolg epa d raInv te aest cov king co ment O /f un i P ltes/ebsa sap , an er, n ptions d an/resea y o. p 13 ................................ ool09 erchers d 1 in (May ves/stat tme ). Ca nist t pic rmbridge, MA: os d/retireme uct ................................ primarilnt y i- nb N vull e ational B stetins ed in /p thure rivat e s................................ eau ce u- rof ip tyension Econom indicat-e pl da .i c Re n-bull searc eti ........... ns h. - 18 >$100,000 to $200,000 10% 9% 10% 9% 10% 11% 11% 10% 10% 10% 10% 10% 10% 3 37 >$200,000 18% 15% 13% 13% 13% 12% 13% 12% 14% 14% 16% 15% 16% ( Ho Fi Thgu e ld Ben, r loe o m Sarah 24 ber). g Ba r, Dan H cla owever, ys Ui.el Schra S. Agg not al regas tes B l , Jaso oparti nd Indcipa n ex Seli is nts cog mman, an phave acc osed of sed cuess Mic rities to 4 hael Bog cover0 in1(k g gov) dan e p rnm lan . en202 t loans and1 c. or“Americ p— ora tfactor e bondan s,ing mV oiew r tin all 40 gags e on D -backe1(k defi se) c n p ued ritarticip ie Contri s, and ants asb se ution t- w bacith ked Departmen • The yea t of Labor, r-en Emplo d 20yee 18 aver Benefage 40 its Security Administratio 1(k) plan account n 2012a bala , 2012b, 2012c, nce in the dat 2012 abase d, 2012e, 2 was 5.9 014, 2015a percent lo , 20we 15b, r Source: Tabulations from EBRI/ICI Participant-Directed Retirement Plan Data Collection Project S No ou te rc : e A:c c T fo u au n b n d u ts lb a , a t bila o an n nk c s e cfs o r o la lm e re c tE p iva e B r tR tircu Ii/p sIC a ts n I, t P la ifa e c c ritn o ic s uu inp r ta a b n n a c tl- a eD n s c ir e e e p sc a t h re a etd le d R a in c e c 4 tio 0 ru e 1n (m k ts )e ,p n a la tn n P d s l a a a n n ty t D h pe a o o t pa la e rd C ti c o in ip lv le a en s cttts m io ’ e n cn u tP r rp e rro n ojtd e e u cm cttp p lo riy m ea rs ri la yn d are net of plan af 2 ter the initial point of enrollment. (For household survey results from fall 2020 reflecting households’ sentiment toward and Security Admi EBRnistr I Issue ation (Ma Brief is regrch) istered . Available in the U.S. Pa at ten ww t and w.d Trol. adem gov ark /sites Office. ISS /dolgo N: v/fil 0887es –1/e 37X/9 bsa/re 0 088 s7 earchers –137X/90 $ .50 /stat+.50 istics /retirement- >$200,000 5% 5% 5% 4% 5% 5% 5% 5% 4% 4% 4% 4% 4% Participants include the 14.6 million 401 (k) plan participants in the year-end 2018 EBRI/ICI 401(k) database. Available at www.nber.org/papers/w13091. 13 s *T eh cu er iabstr tte ien su (rre eact bv a a la ri- n a2 c be l016. e d m iso g npd e th n ly ef r. b a yll y m a yre ka erts c a w po itra kliiz na gt ia on t )c . u Tr hre e n in t de em x's p lto oy ta e l rr e atn ud rn tc ho un ss im sta s yo fo p vre ic rs e ta ap te p re yc eia ar tis o n o /fd e pp arre ticc ia ip tia otni o pn lu isn in th ce om 4e 0 1 a( sk a ) p ple a rn ce . ntage of the original GICs are insurance company products that guarantee a specific rate of return on the invested capital over the life of the AsPlan Sav set All invocat esing ted io , in n 2 02 tto E he 0 . s” qu ec ICI ities uri Res ty ................................ ind eic arch R ated. eport (February ................................ ). Available at www.i ................................ ci.org/pdf/21_ppr_d............................... c_plan_saving.pdf. 21 and Fi log aure n switho . R 21 etha t, irut l e Per m n the yea o ecentag n an t sacces avine gsof r befo s h in t 40 eld 1(k ihe database, n re p) la . P nT s lans Of his is consis at prev fionly o ering Loans us etent 17 mp lo pe ywith e rce r sb o nt h y Plan s r toc rola le k ma d d Si loa oz ve e, rket ns o r in 2018 to declin uts IR ................................ A tanding at s es i are n n o2 t 01 in year c8 lu but m de-d en . d ay not acc 20 ................................ 18. On urat averag ely re e, ov fleer ct. 24 *The tenure variable is generally years working at current employer and thus may overstate years of participation in the 401(k) plan. confidence in 401(k) plans, see Holden et al. 2021.) S iS nv o oeu u srr tc c bu m e e e :: nllet T tT .a a bb ins/ uu l© ala tio t20 priva in os n 21, Empl s fr ofte r m o m - Ep B E ension R B I/oyee Be R ICII/ IP Ca - I pl rP tica airnefi p n ta i- c n b itpull -t Rese D an ireti e t-c D tns e ird e arch - c R a te e b td is r e trac R I m nst ee tin rtte i- tu P m 2007.p la e te n n t – D P Edu atla a d nf C .ca D o la le tio tc at iC o n and n o lP le ro cjte io Rese cn t Pro arc jecth Fund. All rights reserved. Source: Tabulations from EBRI/ICI Participant-Directed Retirement Plan Data Collection Project Source: Tabulations from EBRI/ICI Participant-Directed Retirement Plan Data Collection Project co So ntract. urce: T abulations from EBRI/ICI Participant-Directed Retirement Plan Data Collection Project S So ou u rr cc ee s: : B Ta lob ou mla be tiro gn , s Fr fa rn ok m R E us B sR elIl/ I C C oIm P pa ar nty ic , ia pn ad n t S -tD ain rd ea crtd e & d R Po eo tirr 's ement Plan Data Collection Project ebri.org ebri.org ebri.org ebri.org ebri.org ebri.org ebri.org ebri.org ebri.org ebri.org ebri.org ebri.org ebri.org ebri.org ebri.org ebri.org ebri.org ebri.org ebri.org ebri.org ebri.org ebri.org ebri.org ebri.org ebri.org ebri.org ebri.org ebri.org ebri.org ebri.org ebri.org ebri.org ebri.org ebri.org ebri.org Is Is Is Is Is Is Is Is Is Is Is Is Is Is Is Is Is Is Is Is Is Is Is Is Is Is Is Is Is Is Is Is Is Is Iss s s s s s s s s s s s s s s s s s s s s s s s s s s s s s s s s s sue B ue B ue B ue B ue B ue B ue B ue B ue B ue B ue B ue B ue B ue B ue B ue B ue B ue B ue B ue B ue B ue B ue B ue B ue B ue B ue B ue B ue B ue B ue B ue B ue B ue B ue Bri ri ri ri ri ri ri ri ri ri ri ri ri ri ri ri ri ri ri ri ri ri ri ri ri ri ri ri ri ri ri ri ri ri riA res ef ef ef ef ef ef ef ef ef ef ef ef ef ef ef ef ef ef ef ef ef ef ef ef ef ef ef ef ef ef ef ef ef ef ef • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • Marc Marc Marc Marc Marc Marc Marc Marc Marc Marc Marc Marc Marc Marc Marc Marc Marc Marc Marc Marc Marc Marc Marc Marc Marc Marc Marc Marc Marc Marc Marc Marc Marc Marc Marc earch rep h 4, 202 h 4, 202 h 4, 202 h 4, 202 h 4, 202 h 4, 202 h 4, 202 h 4, 202 h 4, 202 h 4, 202 h 4, 202 h 4, 202 h 4, 202 h 4, 202 h 4, 202 h 4, 202 h 4, 202 h 4, 202 h 4, 202 h 4, 202 h 4, 202 h 4, 202 h 4, 202 h 4, 202 h 4, 202 h 4, 202 h 4, 202 h 4, 202 h 4, 202 h 4, 202 h 4, 202 h 4, 202 h 4, 202 h 4, 202 h 4, 202 ort from the E 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • No. No. No. No. No. No. No. No. No. No. No. No. No. No. No. No. No. No. No. No. No. No. No. No. No. No. No. No. No. No. No. No. No. No. No. 526 526 526 526 526 526 526 526 526 526 526 526 526 526 526 526 526 526 526 526 526 526 526 526 526 526 526 526 526 526 526 526 526 526 526BRI Education and R esearch Fund © 2021 Employee Benefit Research Institute 12 27 33 36 21 34 22 14 11 35 18 13 32 16 25 30 29 31 24 17 23 20 28 19 10 26 15 6 5 7 4 8 3 2 9 48% 37% 42% Dec-07 39% 44% Jun-08 43% 44% Dec-08 40% 39% Jun-09 11% Dec-09 10% 8% Jun-10 8% 7% Dec-10 7% 6% 4% Jun-11 5% Dec-11 15% 15% Jun-12 18% 21% Dec-12 23% 26% Jun-13 27% 30% Dec-13 31% Jun-14 8% 12% Dec-14 12% 12% 9% Jun-15 8% 8% Dec-15 8% 8% Jun-16 11% Dec-16 15% 10% Jun-17 11% 7% Dec-17 6% 6% Jun-18 6% 6% Dec-18 4% Jun-19 7% 4% Dec-19 4% 4% 4% Jun-20 3% 2% Dec-20 2%

Volume 526

Pages 36

EBRI Issue Brief

March 4, 2021

Sarah Holden

Jack VanDerhei

Steven Bass

Retirement