Retirement Assets Near $22T in Q3

Total U.S. retirement assets reached $21.7 trillion at the end of September, up 3.9% from the $20.9 trillion measured at the end of the June.

Asset levels are up $2.1 trillion over the same quarter a year ago, analysis from the Investment Company Institute (ICI) shows, bringing retirement savings to 34% of all household financial assets in the U.S.

Assets in individual retirement accounts (IRAs) totaled $6 trillion at the close of the third quarter, an increase of 4.6% over the previous quarter. For employer-sponsored defined contribution (DC) plans, assets rose 4.4% in the third quarter to $5.6 trillion, according to the ICI.

Private sector defined benefit (DB) plans ticked up to $2.9 trillion in assets at the end of the third quarter. Government pension plans—including federal, state and local government plans—reached $5.4 trillion in total assets, a 3.7% increase over the previous quarter.

The ICI research shows annuity reserves maintained in outside retirement holdings accounted for $1.9 trillion.  

Breaking down the DC numbers, more than 70% of the $5.6 trillion held in DC plans belonged to 401(k) accounts. Mutual funds managed $3.3 trillion, or 59%, of assets held in 401(k), 403(b) and other DC plans at the end of the third quarter.

For IRAs, 46% of total assets (or $2.8 trillion), belonged to mutual funds at the end of the third quarter.

Another interesting figure included in ICI’s analysis is the $573 billion held in target-date funds (TDFs), an increase of 6.1% since June.  Retirement accounts held the bulk of target-date mutual fund assets—with 89% of TDFs accessed through DC plans and IRAs.

Since the end of the same quarter a year ago, TDF assets are up $113 billion, or about 25%.