One-third of 401(k) participants who are 60 years old or older have at least 75% of their total account balances in company stock, and nearly 20% have their entire balances in company stock, according to a new study of 500,000 active 401(k) participants by Hewitt Associates. Overall, 29% of participants have at least 75% of their balances in company stock, and about 15% of participants have their entire balances in company stock.
Hewitt's study also indicated few participants rebalanced or made any trades in their 401(k) accounts last year. Less than one in five, or 19.5%, of 401(k) participants made any kind of trade in 2001, down from 30% in 2000. Equity investments were 76% of total balances in 2001, down from 81% in 2000. Moreover, 75% of participants' assets are divided among only a few asset classes: company stock, large-cap U.S. equity and GIC/stable value.