Only 41% of participants were Baby Boomers, according to third-quarter data; however, Boomers still control the most assets (61%). Gen X and Gen Y hold 31% of DC plan assets on MassMutual’s platform.
The data analysis also found the percentage of MassMutual’s total participant assets in age-based and risk-based options reached an all-time high during Q3 2012, accounting for 26.6% of total DC plan assets under management. Gen Y participants (born between 1982 and 1995) held 49.8% of those assets versus 29.8% held by Gen X (born between 1965 and 1981) and 22.6% held by Boomers. Gen X participants had the highest allocations in equities (45.6%) for the quarter ended September 30, compared with Gen Y (32.2%) and Baby Boomers (38.4%).
Women continue to favor age-based investments far more than risk-based options, at 72% versus 28%, respectively. Men remain more divided, with approximately 52% in age-based versus 48% in risk-based investments. Average account balances for women grew 3.92% for the quarter compared with 4.17% for men. Average account balances for women fall behind those of men by 38.4%, an improvement from 40.5% in late 2010.
“Not surprisingly, Gen Y savers are taking full advantage of asset allocation investment options,” Elaine Sarsynski, executive vice president of MassMutual’s Retirement Services Division and chairman and CEO of MassMutual International LLC, said. “We are so pleased to see that younger generations appear to understand the importance of starting early to save for retirement.”
The percentage of MassMutual participants who initiated loans in the third quarter (1.7%) was at its lowest level in four years.