How self-directed retirement savers invested in the fourth quarter: Schwab

Pension plan participant account balances in self-directed brokerage accounts averaged $352,764 at the end of the fourth quarter, a 6.4% year-over-year increase and a increase of 3.4% compared to the third quarter, Charles Schwab reported this week.

SDBA account holders can use their brokerage accounts to invest their retirement savings in individual stocks and bonds, ETFs, mutual funds and other securities that are not part of SDBA’s core investment offerings. their pension plan.

During the fourth quarter, investors remained resilient in a historically volatile year, the report noted. November started with fears about new variants of COVID, inflation and dwindling Federal Reserve assets, but as investor concerns subsided and the economy broadly stabilized , their balances ended the quarter up.

Participants’ holdings remained similar to the fourth quarter of 2020. Thirty-seven percent of participants’ assets were in equities compared to 35% in 2020; 30% in mutual funds against 31%; 21% in ETFs versus 18%; 11% cash versus 14%; and 1% in fixed income securities versus 2%.

Schwab based its report on data collected from some 178,000 retirement plan participants who currently have balances between $5,000 and $10 million in their plans. Schwab Personal Choice Retirement Account.

Other Report Highlights

The report says advised accounts held average account balances of $558,470, compared to $304,164 for non-advised accounts. Forty-nine percent of Gen X investors had advised accounts, followed by 34% of baby boomers and 15% of millennials.

Generation X accounted for about 45% of SDBA participants in the fourth quarter, baby boomers 31% and millennials 19%.

Baby boomer SDBA balances averaged $548,658, compared to $315,574 for Gen X and $106,408 for Millennials.

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