Men are participating at a greater rate and socking away more money in their workplace retirement accounts than women are, according to a new survey by Wells Fargo.
The report finds that 49 percent of men are enrolled in a company 401(k) plan, versus just 43 percent of women. Among those who participate, 43 percent of men are saving the 10 percent recommended by Wells Fargo, compared to 39 percent of women.
Women, however, may be making smarter decisions when it comes to asset allocation: 70 percent of women meet Wells Fargo’s recommended minimum level of diversification, compared to 67 percent of men. (The bank considers a portfolio meeting a minimum level of diversification when it has a minimum of two equities and a fixed fund, and less than 20 percent in employer stock.) The reason for the disparity might be that more women (74 percent) put their money into managed investment options, versus 71 percent of men.
Both genders have benefited from the huge stock market gains over the past two years, with balances rising 35 percent during that period.
The increase in 401(k) balances also correlates with an increase in risky 401(k) loans. A fifth of participants now have an outstanding loan balance on their retirement account, up more than 5 percent in the past two years.
One in four workers who left a job in 2013 cashed out their 401(k), rather than leaving the money in the plan or rolling it into an IRA. Another trend highlighted in the report was the rise in Roth 401(k) usage, which increased more than 20 percent from two years ago.
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