Schwab Report: Self-Directed 401(k) Balances Increase 22% Year-Over-Year
According to Charles Schwab’s SDBA Indicators Report, an
industry-leading benchmark on retirement plan participant
investment activity within self-directed brokerage accounts
(SDBAs), the average account balance across all participant
accounts finished Q2 2021 at $348,183, a nearly 22% increase
year-over-year and a 4.3% increase from Q1 2021.
SDBAs are brokerage accounts within retirement plans, including
401(k)s and other types of retirement plans, that participants can
use to invest retirement savings in individual stocks and bonds, as
well as exchange-traded funds, mutual funds and other securities
that are not part of their retirement plan's core investment
The second quarter SDBA Indicators Report also showed that
trading volumes were in line with one year ago at an average of 14
trades per account, as participants encountered familiar COVID
volatility with the rise of the Delta variant. Despite some fears,
participants saw account growth year-over-year as stocks continued
to climb off the March 2020 low and consumer confidence surged back
to pre-pandemic levels.
The majority of participant assets were held in equities (37%).
Mutual funds were the second largest holding at (30%), followed by
ETFs (20%), cash (12%), and fixed income (1%).
The data also reveals specific asset class and sector holdings
within each investment category:
- Mutual funds: Large-cap funds had
the largest allocation at approximately 34% of all mutual fund
allocations, followed by taxable bond (19%) and international (16%)
- Equities: The largest equity
sector holding was Information Technology at 29%. Apple was the top
overall equity holding, comprising 10.26% of the equity allocation
of portfolios. The other equity holdings in the top five include
Tesla (6.28%), Amazon (5.03%), Microsoft (2.72%) and NVIDIA
- ETFs: Among ETFs, investors
allocated the most dollars to U.S. equity (50%), followed by sector
ETFs (15%), international equity (13%) and U.S. fixed income
Other Report Highlights
- Advised accounts held higher average account balances compared
to non-advised accounts - $550,127 vs. $302,330.
- Gen X had the most advised accounts at 48%, followed by Baby
Boomers (36%) and Millennials (13%).
- Gen X made up approximately 45% of SDBA participants, followed
by Baby Boomers (32%) and Millennials (18%).
- Baby Boomers had the highest SDBA balances at an average of
$532,338, followed by Gen X at $306,489 and Millennials at
$103,777. All balances were up from Q1 2021.
- On average, participants held 12.3 positions in their SDBAs at
the end of Q2 2021, up slightly from 10.5 last year and consistent
with Q1 2021.
About the SDBA Indicators Report
The SDBA Indicators Report includes data collected from
approximately 174,000 retirement plan participants who currently
have balances between $5,000 and $10 million in their Schwab
Personal Choice Retirement Account®. Data is extracted quarterly on
all accounts that are open as of quarter-end and meet the balance
The SDBA Indicators Report tracks a wide variety of investment
activity and profile information on participants with a Schwab
Personal Choice Retirement Account (PCRA), ranging from asset
allocation trends and asset flow in various equity, exchange-traded
fund and mutual fund categories, to age trends and trading
activity. The SDBA Indicators Report provides insight into PCRA
users’ perceptions of the markets and the investment decisions they
Data contained in this quarterly report is from the second
quarter of 2021, and can be found here, along with prior
About Charles Schwab
At Charles Schwab we believe in the power of investing to help
individuals create a better tomorrow. We have a history of
challenging the status quo in our industry, innovating in ways that
benefit investors and the advisors and employers who serve them,
and championing our clients’ goals with passion and integrity.
More information is available at www.aboutschwab.com. Follow us
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Brokerage Products: Not FDIC‐Insured • No Bank Guarantee •
May Lose Value
The securities shown are for informational purposes only and are
not a recommendation to transact in any security.
Through its operating subsidiaries, The Charles Schwab
Corporation (NYSE: SCHW) provides a full range of securities
brokerage, banking, money management and financial advisory
services to individual investors and independent investment
advisors. Its broker-dealer subsidiary, Charles Schwab & Co.,
Inc. (member SIPC, www.sipc.org), and affiliates offer a complete
range of investment services and products including an extensive
selection of mutual funds; financial planning and investment
advice; retirement plan and equity compensation plan services;
compliance and trade monitoring solutions; referrals to independent
fee-based investment advisors; and custodial, operational and
trading support for independent, fee-based investment advisors
through Schwab Advisor Services. Its banking subsidiary, Charles
Schwab Bank (member FDIC and an Equal Housing Lender), provides
banking and lending services and products. More information is
available at www.schwab.com and www.aboutschwab.com.
This report is for informational purposes only and is not a
solicitation, or a recommendation that any particular investor
should purchase or sell any particular security.
Schwab Personal Choice Retirement Account® (PCRA) is offered
through Charles Schwab & Co., Inc. (member SIPC), the
registered broker/dealer, which also provides other brokerage and
custody services to its customers.
All corporate names are for illustrative purposes only and are
not a recommendation, offer to sell, or a solicitation of an offer
to buy any security.
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Mike Peterson Charles Schwab 330-908-4334
Carly Taylor The Neibart Group 718-801-8206
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