Defined contribution (DC) plan participants did not change their asset allocation much in the first quarter of 2018, despite some wild volatility, according to the Investment Company Institute’s (ICI) “Defined Contribution Plan Participants’ Activities, First Quarter 2018.”
Defined contribution plans refer to 401(k) plans as well as other similar type plans offered in the public sector.
The study found that only 1.1 percent of DC plan participants stopped contributing during this period and only 5.1 percent of DC plan participants changed the asset allocation of their account balances in the first quarter. Additionally, just 3.5 percent changed the asset allocation of their contributions. This data is consistent with past years.
Only 1.3 percent of DC plan participants took withdrawals in the first quarter, the same share as in the first quarter of 2017. Also, only 0.5 percent of DC plan participants took hardship withdrawals in the quarter, about the same share as in the first quarter of 2017.
On Feb. 5, the Dow Jones Industrial Average dropped 175.21 points, the largest one-day point drop in history.
The report also showed that loan activity edged down in the first quarter of 2018 as 16.4 percent of DC plan participants had loans outstanding, compared with 16.7 percent at the end of 2017.
ICI’s survey data is culled from a cross-section of recordkeeping firms representing a broad range of DC plans.