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Employer-sponsored retirement assets hit $10.9 trillion

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Employer sponsored U.S. retirement assets rose 8 percent in 2012, new research shows., a unit of Spectrem Group LLC, released this finding in its “2013 Retirement Market Insights Survey.”

Assets held in employer-sponsored retirement plans totaled $10.9 trillion in 2012, up 8 percent from the $10.1 trillion recorded in 2011. Individual retirement accounts held another $5.4 trillion, bringing all U.S. retirement assets to $16.3 trillion.

Private sector retirement plans account for the largest share of employer-sponsored assets at $6.7 trillion, the survey shows. Public sector retirement and 403(b) plans, used by educational and healthcare institutions, accounted for $3.3 trillion and $882.2 billion, respectively, last year.

Corporate defined benefit plans totaled $2 trillion in 2012, up from $1.9 trillion in 2011, the survey reveals. Union defined benefit plans totaled $363 billion and $346 billion in 2012 and 2011, respectively.

The survey adds that 401(k) plans are the most widely adopted plan in the private sector. Most plans have fewer than 50 participants, but assets and participating employees are concentrated in plans with 1,000 or more participants.

The report adds that 401(k) plan assets have grown at an annual average rate of 3.4 percent over the past five years, attaining $3 trillion in 2012, up from $2.7 trillion in 2011.

Participants’ investment allocations are more equity-oriented now than at the height of the economic crisis of 2008. In 2012, equity allocations — including diversified equity, company stock and balanced/asset allocation funds — garnered in the aggregate for 69 percent of investors’ portfolios, as compared to 56 percent in 2008. However, the 2012 total remains below the 2006 peak of 74 percent for these funds in 2006.

The survey notes also that more than 80 percent of IRA assets are held in mutual funds or self-directed brokerage accounts, accounting for $2.4 trillion and $2.1 trillion, respectively, of the $5.4 trillion total. Additional IRA assets are held by life insurers ($451 billion) and banks, credit unions and savings institutions ($487 billion), the report states.


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