Investing May 25, 2000

Defined Contribution Assets Top $2 Trillion in 1999

May 25, 2000 (PLANSPONSOR.com) - Corporate defined contribution plans continued their steady growth in 1999, reaching $2.4 trillion in assets, according to the Spectrem Group.
Reported by

The research and consulting firm said that defined contribution plans now represent half of all corporate retirement plan assets. Of the total, $1.4 trillion is made up of 401(k) plan assets.

The report also found:

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  • plan sponsors are overall content with their plan providers; only 2% of the 635 sponsors interviewed for the study indicated they would definitely switch vendors for a 15% fee reduction
  • mutual fund providers are still growing their market share and now control 39% of full-service plans
  • plan savings continue to shift into equity investments; assets in equity funds and company stock represented 63.5% of the total, up from 55.3% in 1997
  • with increasing concentration of assets in equities, performance will remain a key determinant of satisfaction among plan sponsors
  • recordkeeping is still a hot button for plan sponsors, with sub-standard service in this area a major reason for switching vendors.

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