401(k) plan participants in the second quarter shifted retirement assets out of stable value funds and into equities and lifecycle funds as they appeared to gain more confidence in the stock market, according to a survey released today by MassMutual's Retirement Services Division.
According to the survey of 1 million participants in 401(k) plans administered by the unit of Massachusetts Mutual Life Insurance, stocks accounted for the greatest portion of 401(k) assets in the second quarter, at 38.7%. That compared with 31.7% for stable value, 21.5% for asset allocation investments and 8.1% for bonds, confirmed spokeswoman Lisa Reilly.
In the first quarter, stable value accounted for the largest portion of 401(k) participant assets, with 36.3%, according to the survey. Equities accounted for 35.1%, while asset allocation investments had 20.8% and fixed income, 7.8%.
“The second-quarter data hint at renewed participant confidence in equity investments,” said Elaine Sarsynski, executive vice president of MassMutual's Retirement Services Division and CEO of MassMutual International LLC.
MassMutual found that 19% of participants made changes to their asset allocation in the second quarter, compared with 25% in the first quarter and 20% in the fourth quarter of 2008.
Ninety percent of plan participants did not change their savings rate in the second quarter, according to the survey, while 8% decreased their deferral rate and 2% increased their rate.