Retirement savings: Investors didn't take risky bets in August

00:05 Josh

As interest in alternatives like private equity and real assets heats up, many 401k investors remain unusually cautious, sticking to traditional stocks and bonds, even though private assets are becoming a louder part of the conversation. For more on this, let’s get to senior columnist, Kerry Hannon. Kerry.

00:32 Kerry

Yeah, actually is pretty interesting because there has been a lot of talk about private assets and what we found what we saw in August was that investors actually had a bit, you know, had a bit of jitters about this and were very quietly, this was a report I saw from Alight. Uh, we looked into that very quietly shifting from large company and small company equities, uh, into, you know, more conservative bonds and to a lesser extent money market accounts, very on the low key, but but there was definitely this quiet shift. I mean, there were no above normal trading days in 401k accounts. It was very subtle, but there was definitely this undertone of uh, let’s be a little more cautious here, Josh. So that was fairly interesting.

01:10 Josh

And what and Kerry, what what kind of inflows and outflows are we seeing here?

01:17 Kerry

Yeah, I mean, it was there were not huge amounts, but it was clearly this transition we saw the movement from equities into these more conservative fixed income funds. But but, you know, what you and I have talked about, these private assets are really getting up a lot of attention and and recently, uh there was a report that was out from Schroder that showed that like nearly half of 401k investors said, hey, you know, as soon as these private assets are in our plans, we really want to invest in these. And in fact, three and four said we’re going to even invest, you know, up our contributions to our 401k plan so that we can invest in these. And it’s this disconnect is quite interesting because if they’re getting jitters now about risk and not taking risk, um, I wonder and and it poses the question, are, you know, what you say and what you actually do, when they, these private riskier private assets do hit, uh, retirement account plans probably mid-year next year when when I know that Goldman Sachs and T-Ro Price are expecting to have their target date up and rolling. Um, will they do that? Are they going to go for these or will they have the not have the stomach for them?

02:20 Josh

All right. Thank you, Kerry. Appreciate it.

02:23 Kerry

Thanks, Josh.