How do tech workers at Salesforce choose to invest for retirement?
Salesforce offers a 401(k) retirement savings plan for its ~50,000 employees. Employees can choose to contribute a portion of their income to the plan. But which investments do Salesforce employees pick as retirement investments?
A 401(k) retirement savings plan is a type of defined contribution plan.
The Salesforce plan allows for matching contributions. Salesforce makes matching contributions in an amount equal to 100% of the first 6% of pre-tax compensation deferred by participants (up to max of $5,000 per year).
Form 5500 lists the investments Salesforce 401(k) plan participants selected for their retirement funds. Giving us insight into how Salesforce employees choose to invest for retirement.
401(k) plan sponsors are required to file Form 5500 with the Department of Labor each year.
So, what do Salesforce employees invest in?
The first thing to note is that they don’t directly invest in shares of Salesforce stock.
As opposed to some other tech companies (e.g., Amazon), Salesforce doesn’t appear to offer their own shares as an investment option.
Target date retirement (JPMCB SmartRetirement) funds account for about half of Salesforce employee’s retirement investments.
These funds are designed to shift their holdings as the target retirement year approaches. They gradually shift to more bonds and fewer equities. In other words, they become more conservative as time passes.
The largest of these holdings is the JPMCB SmartRetirement Passive Blend 2050, designed for people planning to retire around the year 2050.
Target retirement funds occupy 6 of the top 10 holdings.
By far the largest holding—at 16% of plan assets—is the Fidelity 500 Index Fund. This fund tracks the performance of the S&P 500 Index, representing around 500 of the largest companies in the United States—a great choice for a core investment holding.
The Fidelity Contrafund Fund is the other large non-target date fund holdings. Coming in at 6th place.
Plan assets as of 12/31/2021
(from Salesforce’s 2022 filing of Form 5500)
| Top 10 Investments | % |
| Fidelity 500 Index Fund | 16% |
| JPMCB SmartRetirement 2050 | 10% |
| JPMCB SmartRetirement 2045 | 9% |
| JPMCB SmartRetirement 2055 | 8% |
| JPMCB SmartRetirement 2040 | 8% |
| Fidelity Contrafund Fund | 8% |
| JPMCB SmartRetirement 2035 | 6% |
| Fidelity Extended Market Index Fund | 4% |
| JPMCB SmartRetirement 2030 | 4% |
| Fidelity Small Cap Index Fund | 3% |
See the Salesforce 401(k) page for additional plan details and value of holdings.
Salesforce’s Retirement Distribution
The distribution of assets in JP Morgan Chase Bank (JPMCB) SmartRetirement Passive Blend target date retirement funds—provide a rough view of participating employee ages.
The largest holdings are in the SmartRetirement Passive Blend 2050 and 2045 target funds. These investments should represent employees who plan to retire in the next 20 to 25+ years.
Source: 2021 Form 5500 for Salesforce’s 401k plan
