Average account balances across all participant accounts were down for the first quarter of 2025, according to a new analysis by Schwab.
The Q1 SDBA Indicators Report, a benchmark analysis that examines retirement plan participant investment activity within self-directed brokerage accounts (SDBAs), found that the average account balance for Q1 2025 finished at $335,857, down 4.7% compared to Q4 2024. This was likely due to macroeconomic uncertainty and a rise in market volatility that dulled equity markets and spurred glum consumer sentiment, Schwab reports.
As a result of market tensions, the S&P 500 had declined 5% during the first quarter of the year.
Despite lacking in performance compared to the end of the last year, account balances were still up 2.3% year-over-year, Schwab’s report found. Trading volumes also grew, averaging at 15.9 trades per account.
While average accounts had around $300,000 in assets, advised accounts were likeliest to hold the most at $525,213 versus $293,605 for non-advised accounts. Baby Boomers had the highest account balances at $560,250, compared to $343,831 for Gen Xers and $124,381 for Millennials.
Results for other data points, like participant holdings, were akin to those in Q4 2024. According to Schwab, equities continued to lead in asset classes at 33.4%. Information Technology was the top equity sector holding at 35.9%, followed by Apple at 9.7% and Nvidia at 9.3%. Tesla, Amazon, and Microsoft were also counted as top holdings, at 6%, 4.7%, and 3.2%, respectively.
Mutual funds persisted as the second largest holding at 27.3%, with the largest allocation resorting to large-cap stock funds at 33.2%. This was followed by money market funds at 18.3% and taxable bond funds at 15.2%.
Exchange-traded funds recorded 27% of participant assets, with investors allocating most dollars to U.S. equity at 50.7% followed by U.S. fixed income at 13.9% and international equity at 11.6%.
Finally, cash holdings held 8% of participant assets while fixed income had 4.3% of assets.
The SDBA Indicators Report includes data from 308,000 retirement plan participants with balances between $5,000 and $10 million in their Schwab Personal Choice Retirement Account.
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Amanda Umpierrez is the Managing Editor of 401(k) Specialist magazine. She is a financial services reporter with nearly a decade of experience and a passion for telling stories and reporting news. She is originally from Queens, New York, but now resides in Denver, Colorado.