Employee Savings: Lifecycle Management Gains Traction Among Younger Generations

 

As a result of this shift and a reduced aversion to risk, equity-invested funds are gaining ground at the expense of money market funds.

Asset allocations are becoming better aligned with investment objectives. This is one of the key takeaways from the annual study on employee savings published by the French Asset Management Association (AFG). While total assets under management in company savings plans (PEE) and collective retirement vehicles (Perco, Perecol) grew by nearly 15% year-on-year to €229.4bn (as of year-end 2025), it is particularly noteworthy that the share of money market funds has continued to decline.

Financial Education Bearing Fruit

Once highly popular (representing over 20% of assets in the early 2010s), money market funds have lost ground, accounting for only 15% of the total in 2025. This shift has primarily benefited equity funds, whose share rose from 10% to 17% in just under 15 years. When including employee shareholding funds, the total equity component even climbs to 54%.

Money market funds are certainly far from being sidelined. They still recorded €1.4bn in net inflows last year. However, during the same period, inflows into equity funds were more robust, reaching €2.3bn.

In the midst of Employee Savings Week, industry professionals can only welcome these results. Many have been arguing for years that employee savings are medium-to-long-term investments and that it is therefore inefficient to invest them in money market funds, which are short-term products par excellence.

87% Equity Exposure for Under-30s

While financial education has undoubtedly played its part, generational turnover has also been a major factor in these changes. "Nearly 50% of retirement savings assets held by those under 30 are in lifecycle management in 2025," the AFG points out. In comparison, the use of lifecycle management is significantly lower amongst older generations (41% for the 50-59 age group and 35% for those beyond). In its pursuit of matching objectives with means, lifecycle management does not hesitate to favor equities—far more so, in any case, than many savers would do under self-directed management.

Furthermore, lifecycle management allows savers to choose their profile from various options (from defensive to aggressive), and this choice also influences the final asset allocation. Here again, younger generations stand out from their predecessors. Amongst those under 30, 87% of assets under lifecycle management are exposed to equities. Naturally, the progressive de-risking of portfolios based on age tends to lower this rate for older savers (around 50% in money market instruments from age 60 in lifecycle management). However, given historical allocations, it is reasonable to assume that the population now nearing retirement had collectively adopted a more cautious stance when they were at the start or middle of their working lives.

https://www.marketscreener.com/news/employee-savings-lifecycle-management-gains-traction-among-younger-generations-ce7e5ed3df80ff27