US. Q2 Market Losses Hard on Self-Directed 401k Balances
Self-directed 401k investors’ balances declined with the market in the second quarter of 2022, according to the latest edition of the Charles Schwab SDBA Indicators Report, an industry-leading benchmark on retirement plan participant investment activity within self-directed brokerage accounts (SDBAs).
The report, released today, found the average account balance across all participant accounts finished at $283,485 for the second quarter ending June 30, an 18.58% decrease year-over-year and a 14.62% decrease from the first quarter of 2022.
The Q2 SDBA Indicators reflected another volatile period for markets prior to the July/August market recovery. In the second quarter, the S&P 500 hit its lowest level since December 2020 as still-high inflation, sharp increases in interest rates, rising recession risks, and ongoing geopolitical unrest pressured stocks and other assets.
Against this backdrop, equity allocations decreased to 33% of assets, down from 37% last year and 36% in the first quarter. Cash allocations increased to 15% of assets, up from 12% last year and 13% in the first quarter.
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