How Fast the CIT Wrapper Is Spreading Inside Existing 401(k) Plans
Most CIT market-share figures compare one year's universe of plans with another's, so new plans, closed plans and plans crossing size thresholds all blur the trend. We took a different approach: we followed the same 42,000 large 401(k) plans from their 2022 Form 5500 filings to their 2024 filings, so every change below happened inside a plan that existed in both years.
The headline
Inside those plans, collective investment trusts (CITs) went from 57% to 61% of fund dollars in two years. About 2,300 plans added their first CIT; about 1,000 dropped them.
The move is all at the top
| Plan size | CIT share, 2022 | CIT share, 2024 |
|---|---|---|
| Over $1 billion | 77% | 81% |
| Over $250 million | 38% | 44% |
| Under $25 million | 13% | 13% |
Large plans have the scale to negotiate a CIT's lower, customized fees, and their committees and consultants are set up to review a trust's declaration and fee schedule. Small plans mostly buy what their recordkeeper's platform offers, and for many of them that is still a mutual fund menu.
Target-date funds are where the switch shows up
Target-date funds are the biggest line on most 401(k) menus, because they are usually the plan's default investment. Among plans that changed the wrapper on a target-date series, 522 moved from mutual fund to trust against 135 the other way. About three-quarters were the same manager re-papering the same strategy: the glide path stayed, and the plan moved to the cheaper vehicle.
That matters for what comes next. When a plan re-papers its default fund as a CIT, it has already accepted a trust as the home for its largest pool of participant money.
The recordkeeper shapes the pace
On a slightly broader panel of plans that filed holdings in both years, the CIT share rose at nearly every major recordkeeper, but by very different amounts and from very different starting points.
| Recordkeeper (2024) | CIT share, 2022 | CIT share, 2024 | Change |
|---|---|---|---|
| Fidelity | 57.5% | 62.2% | +4.7 pts |
| Empower | 48.2% | 51.7% | +3.5 pts |
| Vanguard | 57.3% | 60.7% | +3.4 pts |
| Principal | 42.9% | 46.1% | +3.2 pts |
| Transamerica | 24.1% | 26.8% | +2.7 pts |
| John Hancock | 15.8% | 17.0% | +1.2 pts |
| Voya | 75.2% | 76.2% | +1.0 pts |
| ADP | 12.9% | 12.6% | -0.3 pts |
The platforms serving larger plans moved most. Platforms built around small-plan, mutual-fund menus barely moved, which matches the size pattern above.
Why a trust, and why it matters for alternatives
A CIT is a pooled fund maintained by a bank or trust company. It is regulated by banking authorities rather than registered with the SEC like a mutual fund, which typically means lower costs and more flexibility on fees and structure. Most 403(b) plans still can't use them broadly, which is one reason the shift shows up most clearly in 401(k)s.
That flexibility is why so many DC alternatives products are being built as trusts: a CIT can combine a private-market sleeve with daily-valued public holdings in a single vehicle, inside a structure large plans already use for their default fund.
For anyone building an alternatives product for DC: the wrapper the industry is standardizing on is a trust, and the plans adopting it fastest are the large ones that could hold a private sleeve.
About the data
Figures come from Schedule H filings for 401(k) plans with more than 100 participants, matched by plan sponsor EIN and plan number across 2022 and 2024. Shares are of dollars in mutual funds, CITs and pooled separate accounts on the Schedule of Assets Held. Recordkeepers are inferred from Schedule C and other filing data.
Every plan, fund, manager and recordkeeper behind these numbers is in Axiomatic Plan Intelligence. For more information, email us at info@axiomaticdata.com.
Originally posted on LinkedIn.