The continued rally in equity markets helped boost balances in self-directed 401(k) accounts in the second quarter of 2024, according to a leading indicator from Charles Schwab.
The firm’s SDBA Indicators Report includes data collected from approximately 290,000 retirement plan participants who currently have balances between $5,000 and $10 million in their Schwab Personal Choice Retirement Account.
For Q2 2024, the average balance was up by 5.7% year-over-year to $335,008. This was a 2.1% increase compared to the first quarter of 2024. Advised accounts saw a far higher balance ($528,287) than non-advised accounts ($293,455) and Boomers had the highest SDBA balances at an average of $548,353, followed by Gen X at $329,089 and Millennials at $115,867.
Gen X held the most advised accounts (52%) followed by Boomers (24%), and Millennials (22%). Gen X also made up around 47% of all SDBA participants, followed by Boomers (26%) and Millennials (25%).
Equities accounted for 34.9% of holdings, led by Information Technology (37.9%) including Nvidia (11.1%), Apple (10.7%), Amazon (5.2%), Tesla (5.1%), and Microsoft (4.1%).
The second largest holding was mutual funds (28.1%) driven by large-cap stock funds (34.2%), money market funds (16.2%), and taxable bond funds (14.2%).
ETFs were next at 24.7% with more than half of these holdings allocated to US equity (51.8%), well ahead of fixed income (12.7%), international equity (11.9%), and sector (9.3%) ETFs.
Meanwhile, cash & equivalents held 7.4% of participant assets while 5.0% of assets were held in fixed income.
The average number of positions held by SDBA participants at the end of the second quarter was 11.8, slightly down year-over-year but the same as in the first quarter of 2024. Trading volumes averaged 12 trades per account, similar to the first quarter of 2024 and slightly higher than the second quarter of 2023.
A Nationwide survey finds 47% of GLP-1 users have never discussed the drugs’ financial impact with an advisor, even as many dip into savings.
The hundreds of millions of dollars from a sale of Inspired Healthcare properties does not mean an immediate windfall for investors.
Its SEC filings said one thing - a congressional probe said another.
Sham agreements allegedly padded revenue by 345%.
"Most pre-retirees are uncomfortable making key retirement income decisions without an advisor's help," said Chris Bailey of Cerulli.
Knighthead Life entered the market with a competitive MYGA. A strong launch earned advisor confidence and paved the way for FIAs.
As AI makes financial information more accessible than ever, Lana Hock explains why human judgment, trust, and empathy remain the qualities clients value most in a financial advisor
