Schwab Report: Self-Directed 401(k) Balances Higher as Investors Remain Resilient Through Volatility In 2021
Charles Schwab's SDBA Indicators Report for Q4 2021 reveals an average account balance of
- Average account balance increased to $352,764, a 6.4% year-over-year rise.
- Equities represent 37% of participant assets, up from 35% in 2020.
- Advised accounts saw higher average balances ($558,470) compared to non-advised ($304,164).
- Participants held 12.5 positions in their SDBAs, consistent with previous quarters.
- Quarterly trading volumes declined slightly to 13.3 trades, down from 13.9 year-over-year.
SDBAs are brokerage accounts within retirement plans, including 401(k)s and other types of retirement plans, that participants can use to invest retirement savings in individual stocks and bonds, as well as exchange-traded funds, mutual funds and other securities that are not part of their retirement plan's core investment offerings.
The fourth quarter 2021 SDBA Indicators Report reflects continued resilience among investors through a historically volatile year. November began with fears over new COVID variants, inflation, and Fed asset tapering, but balances ultimately ended the quarter higher as investor concerns subsided and the economy proved stable overall.
Participant holdings remained similar to the fourth quarter of 2020, with a slight decrease in cash holdings and slight increases in equities and ETFs. The majority of participant assets were held in equities (
Allocation Trends
The data also reveals specific asset class and sector holdings within each investment category:
-
Mutual funds: Large-cap funds had the largest allocation at approximately
35.1% of all mutual fund allocations, higher than last year (31.9% ). They were followed by taxable bond (18.5% ) and international (14.9% ) funds. -
Equities: The largest equity sector holding was Information Technology at
31.8% , up slightly from29.8% last quarter and similar to last year. The top five equity holdings remained the same as last quarter. Apple was the top overall equity holding, comprising11.9% of the equity allocation of portfolios, followed by Tesla (8.5% ), Amazon (4.5% ), Microsoft (3.2% ) and NVIDIA (2.7% ). -
ETFs: Among ETFs, investors continued to allocate the most dollars to
U.S. equity (51.5% ), followed by sector ETFs (13.4% ),U.S. fixed income (12.8% ) and international equity (12.4% ). Year over year, investors increasedU.S. equity allocations by 2.3 percentage points and decreased fixed income allocations by 2.2 percentage points.
Other Report Highlights
-
Advised accounts held higher average account balances compared to non-advised accounts -
vs.$558,470 .$304,164 -
Gen X had the most advised accounts at
48.9% , followed by Baby Boomers (33.7% ) and Millennials (14.5% ). -
Gen X made up approximately
45.2% of SDBA participants, followed by Baby Boomers (30.7% ) and Millennials (18.5% ). -
Baby Boomers had the highest SDBA balances at an average of
, followed by Gen X at$548,658 and Millennials at$315,574 .$106,408 - Quarterly trading volumes were slightly lower than one year ago, down to 13.3 trades from 13.9, and similar to last quarter (13.1).
- On average, participants held 12.5 positions in their SDBAs at the end of Q4 2021, consistent with Q3 2021 and higher than Q4 2020 (11.4).
About the SDBA Indicators Report
The SDBA Indicators Report includes data collected from approximately 178,000 retirement plan participants who currently have balances between
The SDBA Indicators Report tracks a wide variety of investment activity and profile information on participants with a Schwab Personal Choice Retirement Account (PCRA), ranging from asset allocation trends and asset flow in various equity, exchange-traded fund and mutual fund categories, to age trends and trading activity. The SDBA Indicators Report provides insight into PCRA users’ perceptions of the markets and the investment decisions they make.
Data contained in this quarterly report is from the fourth quarter of 2021, and can be found here, along with prior reports.
About
At Charles Schwab we believe in the power of investing to help individuals create a better tomorrow. We have a history of challenging the status quo in our industry, innovating in ways that benefit investors and the advisors and employers who serve them, and championing our clients’ goals with passion and integrity.
More information is available at www.aboutschwab.com. Follow us on Twitter, Facebook, YouTube and LinkedIn.
Disclosures:
Brokerage Products: Not FDIC‐Insured • No Bank Guarantee • May Lose Value
The securities shown are for informational purposes only and are not a recommendation to transact in any security.
Through its operating subsidiaries,
This report is for informational purposes only and is not a solicitation, or a recommendation that any particular investor should purchase or sell any particular security.
Schwab Personal Choice Retirement Account® (PCRA) is offered through
All corporate names are for illustrative purposes only and are not a recommendation, offer to sell, or a solicitation of an offer to buy any security.
(0222-2WJL)
View source version on businesswire.com: https://www.businesswire.com/news/home/20220301005027/en/
Charles Schwab
330-908-4334
mike.peterson@schwab.com
973-618-6993
schwabrps@neibartgroup.com
Source:
FAQ
What does the SDBA Indicators Report show for Q4 2021?
How much do advised accounts average according to the SDBA report?
What percentage of assets are held in equities in Q4 2021?
How many trades did participants average in Q4 2021?