ICI released a study entitled, "BrightScope/ICI Defined Contribution Plan Profile: A Close Look at 401(k) Plans," which shows trends in 401K plan investing. It says, "With $4.4 trillion in assets at the end of the second quarter of 2014, 401(k) plans have become one of the largest components of U.S. retirement assets, accounting for nearly one-fifth of all retirement assets. Equity funds accounted for the largest share of assets in 401(k) plans. In 2012, about 40 percent of assets were held in equity funds, more than 15 percent was held in balanced funds (with most of that being held in target date funds), and about 10 percent was held in bond funds. GICs and money funds accounted for 15 percent of assets.... Bond funds (mostly domestic) held 10.3 percent of assets and money funds held 3.1 percent. More than half of 401(k) plans offered money funds and more than six in 10 offered guaranteed investment contracts (GICs)." To be exact, 54% of plans offered money funds, says the study. Also, the average plan offered 1 money fund. "A little more than half of 401(k) plans offer one money fund on average, and more than six in 10 401(k) plans offer one GIC on average.... Participants in 401(k) plans with less than $1 million in plan assets had 36.6 percent of their assets invested in balanced funds and 5.4 percent in money funds, on average, compared with 12.6 percent and 3.1 percent, respectively, for participants in plans with more than $1 billion in plan assets.... Money market mutual funds had the lowest expense ratio of any of the asset classes, with an asset-weighted average expense ratio of 0.18 percent of assets in 2012 for money market mutual funds in 401(k) plans. Money market mutual funds experienced the largest decline in expenses, falling from 0.31 percent of assets in 2009 to 0.18 percent in 2012.... Some of the decline in money market mutual fund asset-weighted average expenses may be attributable to fee waivers, which increased substantially in money market funds due to the low interest rate environment following the market turmoil of 2008.... Money market mutual fund expenses fell by 12 basis points, from 0.29 percent in 2009 to 0.17 percent in 2012."
