Mutual Fund Ownership on the Rise, and Mostly Within 401(k)s
Mutual fund ownership has risen significantly among middle-income households over the past two decades, and most hold those mutual funds within employer-sponsored retirement plans, according to new data released this week from the Investment Company Institute (ICI).
“Rising mutual fund ownership among middle-income households demonstrates the important role these investments play in the growing strength of the American middle class.”
ICI’s Sarah Holden
ICI’s latest reports, “Ownership of Mutual Funds and Shareholder Sentiment, 2025” and “Characteristics of Mutual Fund Investors, 2025,” show that the share of middle-income households owning mutual funds rose from 43% in 2005 to 57% in 2025, the largest percentage point increase occurring in the second income quintile. The median income of households that owned mutual funds was $125,000, compared with a mean of $154,700.
“Rising mutual fund ownership among middle-income households demonstrates the important role these investments play in the growing strength of the American middle class,” said Sarah Holden, ICI Senior Director of Retirement and Investor Research. “This trend highlights the benefits of mutual fund ownership and the important role they play in helping investors secure their financial futures.”
In 2025, 73% of mutual fund-owning households held mutual funds in employer-sponsored retirement plans. These plans continue to serve as a key gateway to investing, with 84% of mutual fund-owning households younger than 50 holding mutual funds inside these plans.
The new data also show many mutual fund shareholders had moderate household incomes and were in their peak earning and saving years. Sixty-one percent of U.S. households owning mutual funds had incomes less than $150,000, and 52% were led by household respondents between the ages of 35 and 64 in 2025.
Additional findings in the ICI research include:
- Fund ownership is widespread, as more than half of U.S. households own funds. In 2025, 56.4% of households owned shares of mutual funds or other U.S.-registered investment companies—including exchange-traded funds (ETFs), closed-end funds (CEFs), and unit investment trusts (UITs)—representing an estimated 76.0 million U.S. households and 128.7 million individual investors.
- Newer mutual fund-owning households show increasing diversity. In 2025, 46% of mutual fund-owning households who purchased their first fund after 2019 are Asian, Hispanic, or Black, more than three times the percentage that bought their first mutual fund before 1990.
- Incidence of mutual fund ownership is higher among older generations. In 2025, 57% of Generation X households, 59% of Baby Boomer households, and 63% of Silent Generation households owned mutual funds. By comparison, 50% of Millennial households and 33% of Generation Z households owned mutual funds.
- Most shareholders have confidence that mutual funds can help them meet their investment goals and view the mutual fund industry favorably. In 2025, 82% of mutual fund-owning households expressed confidence in mutual funds, and 75% of mutual fund-owning households familiar with mutual fund companies had a favorable impression of mutual fund companies.
Check out the full “2025 Ownership of Mutual Funds and Shareholder Sentiment” report here, and the full “Characteristics of Mutual Fund Investors” report here.
SEE ALSO:
• More Historic Lows for 401(k) Mutual Fund Expense Ratios
• Lessons from Alternative Mutual Funds for 401(k) Advisors
Veteran financial services industry journalist Brian Anderson joined 401(k) Specialist as Managing Editor in January 2019. He has led editorial content for a variety of well-known properties including Insurance Forums, Life Insurance Selling, National Underwriter Life & Health, and Senior Market Advisor. He has always maintained a focus on providing readers with timely, useful information intended to help them build their business.
