U.S. retirement assets declined slightly in Q2

By BenefitsPro


By Paula Aven Gladych

At the end of June, total U.S. retirement assets were $18.5 trillion, down 2 percent from $18.9 trillion on March 31, 2012. The decrease in retirement assets was driven by the drop in corporate equity values in the second quarter, according to the Investment Company Institute.

Retirement savings accounted for 36 percent of all household financial assets in the United States at the end of the second quarter.

Assets in individual retirement accounts totaled $5.1 trillion at the end of the second quarter, a decrease of 2 percent from the end of the first quarter. Forty-six percent of IRA assets, or $2.3 trillion, were invested in mutual funds.

Defined contribution plan assets fell 2.2 percent in the second quarter to $4.7 trillion. Mutual funds managed $2.7 trillion of assets held in 401(k), 403(b) and other DC plans at the end of June, down from $2.8 trillion at the end of March. Mutual funds managed 57 percent of DC plan assets at the end of the second quarter.

Government pension plans — including federal, state, and local government plans — held $4.6 trillion in assets as of the end of June, a 1.5 percent decrease from the end of March. Private-sector defined benefit plans held $2.4 trillion in assets at the end of the second quarter, and annuity reserves outside of retirement accounts accounted for another $1.6 trillion.

As of June 30, 2012, target date mutual fund assets totaled $427 billion, an increase of 0.5 percent in the second quarter. Retirement accounts held the bulk of target date mutual fund assets: 91 percent of target date mutual fund assets were held through DC plans and IRAs.

Originally published on BenefitsPro.com