Defined contribution money managers reported a large jump in target-date assets under management to $1.44 trillion as of Dec. 31, up 30.5% from the end of 2016, according to Pensions & Investments' annual survey.
While the previous year's survey also showed double-digit growth, target-date assets were up only 10.1% in the year ended Dec. 31, 2016.
Consultants cited target-date strategies' prominence as default investment options, the increased use of auto features, and positive market returns in 2017 as contributors to those funds' growth.
"As the primary default investment vehicle for DC plans, (target-date funds) are getting upward of 50% of new assets," said David O'Meara, New York-based senior investment consultant at Willis Towers Watson PLC.
"Now that they've been instituted for 10 or more years in a lot of plans ... it's not just the very youngest and lower-earning population (that are exposed to target-date funds). It's a pretty broad group of the plan demographics," he added.
The target-date numbers helped boost managers' overall internally managed assets to $6.18 trillion as of Dec. 31, up 15.9% from the end of 2016. During the same period, total DC assets under management rose 17.4% to $7.09 trillion.
Managers' custom target-date assets also grew by double-digits in 2017 to $138.44 billion, up 30.4% from 2016. In 2014 and 2012, managers' custom target-date assets totaled $87.69 and $27.46 billion, respectively.
Along with the growth in target-date assets, the current survey found an increase in managers' passive AUM.
Among internally managed assets, passive domestic equity assets rose 27.7% to $1.59 trillion as of Dec. 31, while passive domestic fixed income increased 18.5% to $356.7 billion. The previous year's survey also showed double-digit growth in passive domestic equity and passive domestic bonds.
Active domestic equity climbed 15.7% to $1.68 trillion as of Dec. 31, while active domestic fixed income declined 6.2% to $1.06 trillion.