No doubt market appreciation had quite a bit to do with it, but total U.S. retirement assets accounted for $27.9 trillion as of December 31, up 3.4 percent from the previous quarter and 11.1 percent for the year.
The latest Investment Company Institute data finds that Americans held $7.7 trillion in all employer-based DC retirement plans, of which $5.3 trillion was held in 401k plans.
In addition to 401k plans, $540 billion was held in other private-sector DC plans, $993 billion in 403b plans, $321 billion in 457 plans, and $563 billion in the Federal Employees Retirement System’s Thrift Savings Plan.
Mutual funds managed $3.5 trillion, or 67 percent, of assets held in 401k plans. With $2.1 trillion, equity funds were the most common type of funds held in 401k plans, followed by $971 billion in hybrid funds, which include target date funds.
As of December 31, 2017, target date mutual fund assets totaled $1.1 trillion, up 5.8 percent in the fourth quarter and up 25.8 percent for the year. Retirement accounts held the bulk of target date mutual fund assets: 87 percent of target date mutual fund assets were held through DC plans (67 percent of the total) and IRAs (20 percent) at year-end 2017.
Assets in individual retirement accounts totaled $8.9 trillion, an increase of 4 percent from the end of the third quarter.
Government defined benefit (DB) plans—including federal, state, and local government plans—held $6 trillion in assets as of the end of December, a 3.8 percent increase from the end of September. Private-sector DB plans held $3.1 trillion in assets at the end of the fourth quarter of 2017, and annuity reserves outside of retirement accounts accounted for another $2.2 trillion.
With more than 20 years serving financial markets, John Sullivan is the former editor-in-chief of Investment Advisor magazine and retirement editor of ThinkAdvisor.com. Sullivan is also the former editor of Boomer Market Advisor and Bank Advisor magazines, and has a background in the insurance and investment industries in addition to his journalism roots.
