Defined contribution plans saw a move toward professionally managed allocations in 2011, according to Chris McIsaac, managing director of Vanguard's Institutional Investor Group.
In the company's new analysis of Vanguard's defined contribution plans called "How America Saves 2012," it found that one-third of all Vanguard participants had their entire account balance invested in either a single target-date fund, a single target-risk or traditional balanced fund, or a managed account advisory service, McIsaac said. At the end of 2005, just 9 percent of Vanguard participants were invested in an automatic investment program.
"These professionally managed investment options have the potential to reshape retirement savings outcomes for these participants," he said. "They signal a shift in responsibility for investment decision-making away from the participant and back to employer-selected investment and advice programs."
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