Retirement Assets Reach $19.5T

Total U.S. retirement assets hit a new record high of $19.5 trillion as of December 31.

U.S. retirement assets increased 0.7% in the fourth quarter and 8.6% for the year, according to data from the Investment Company Institute. As of the end of 2012, retirement assets were 44.4% higher than they were on March 31, 2009, when retirement assets hit a low during the recession, and 7.9% higher than their pre-recession peak on September 30, 2007. Retirement savings accounted for 36% of all household financial assets in the United States at the end of 2012.  

Americans held $5.1 trillion in all employer-based defined contribution (DC) retirement plans on December 31, of which $3.6 trillion was held in 401(k) plans. Those figures are up from $5.0 trillion and $3.5 trillion, respectively, as of September 30, 2012. Mutual funds managed $2.9 trillion of assets held in 401(k), 403(b), and other DC plans at the end of December, up from $2.8 trillion at the end of September. Mutual funds managed 57% of DC plan assets at the end of the fourth quarter.  

Assets in individual retirement accounts (IRAs) totaled $5.4 trillion at the end of 2012, an increase of 1.1% from the end of the third quarter. Defined contribution (DC) plan assets rose 0.9% in the fourth quarter. Combined, DC and IRA assets were up 10.5% for the year, 54.1% since the first quarter of 2009, and 14% since the third quarter of 2007.   

Government pension plans—including federal, state, and local government plans—held $4.8 trillion in assets as of December 31, an increase of 0.6% for the quarter and 7.7% for the year. Private-sector defined benefit plans held $2.6 trillion in assets at the end of the fourth quarter of 2012, and annuity reserves outside of retirement accounts accounted for another $1.7 trillion.  

As of December 31, target-date mutual fund assets totaled $481 billion, up 4.6% in the fourth quarter and up 27.9% for the year. Retirement accounts held the bulk of target-date mutual fund assets: 91% of target-date mutual fund assets was held through DC plans and IRAs.  

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