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- 401(k) investors rushed to safe havens in the second quarter</p>
<p>Kerry HannonJuly 11, 2025 at 10:06 PM</p>
<p>Retirement investors were not content to ride out the second quarter's choppy market, according to Alight Solutions' 401(k) Index.</p>
<p>Trading levels in these retirement accounts hit the highest levels in five years, as investors in 401(k)s actively shifted funds from stocks to fixed income.</p>
<p>People pulled large sums of 401(k) money mostly from target-date funds — to my dismay. Some folks swapped company stock and midsize US equity funds for more conservative bonds and to a lesser extent money market funds and stable value funds.</p>
<p>Investors, in fact, swapped their equities for fixed income on 40 out of 61 trading days, with 42% of inflows going to bonds, according to the data.</p>
<p>Read more: What is a 401(k)? A guide to the rules and how it works.</p>
<p>"These moves towards fixed income investments reflect a desire among investors to reduce volatility in their retirement accounts," Rob Austin, head of thought leadership at Alight Solutions, told Yahoo Finance. "While some reacted to market swings, others took a more measured approach, rebalancing their portfolios to meet target allocations, especially since equities outperformed fixed income in the second quarter."</p>
<p>The tide began to turn in June when trading activity hit the brakes, compared to April and May, Austin said. New contributions to equities ticked up from 70% to 70.4%, and international equities topped the list for net inflows for equities.</p>
<p>Have a question about retirement? Personal finances? Anything career-related? Click here to drop Kerry Hannon a note.</p>
<p>These findings are in sharp contrast to Fidelity Investments' first quarter analysis.</p>
<p>"We saw a lot of positive savings behaviors among employees," Mike Shamrell, vice president of workplace thought leadership at Fidelity Investments, said at the time.</p>
<p>"It was really encouraging to see that despite a lot of things going on, and economic ups and downs, people continued to save and didn't pull back, or make a lot of changes to their asset allocation," he said.</p>
<p>So much for that.</p>
<p>Kerry Hannon is a Senior Columnist at Yahoo Finance. She is a career and retirement strategist and the author of 14 books, including the forthcoming "Retirement Bites: A Gen X Guide to Securing Your Financial Future," "In Control at 50+: How to Succeed in the New World of Work," and "Never Too Old to Get Rich." Follow her on Bluesky.</p>
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