401(k) investors shift to safe havens, favor fixed income

Retirement investors were active in Q2, with 401(k) trading hitting 5-year highs. Investors shifted funds from stocks to fixed income, pulling money from target-date funds and swapping equities for bonds. 40 out of 61 trading days saw the shift to fixed income, with 42% of inflows going to bonds.

In June, trading activity slowed, and new contributions to equities increased. International equities led in net inflows for equities. These findings differ from Fidelity Investments’ first-quarter analysis, which showed positive savings behaviors among employees. Despite market swings, people continued to save without changing asset allocation.

Kerry Hannon, a Senior Columnist at Yahoo Finance, shares retirement and career advice. She is the author of several books, including “Retirement Bites: A Gen X Guide to Securing Your Financial Future.” Follow her on Bluesky and sign up for the Mind Your Money newsletter for personal finance news and updates.

Read more at Yahoo Finance: 401(k) investors rushed to safe havens in the second quarter