What Do Amazon Employees Invest In?

401(k) plan sponsors are required to file Form 5500 with the Department of Labor every year. Along with other information, Form 5500 lists which investments plan participants have selected for their retirement funds—giving us insight into how Amazon.com employees choose to invest for retirement.

So what do your fellow Amazon employees invest in?

Perhaps not surprisingly, the company stock fund (i.e., shares of AMZN) is by far the largest investment across Amazon plan participants, with 23% of total plan assets. This investment choice is only available for company matching contributions and not for employee contributions. Given the high percentage of assets, it appears that most employees choose to retain much of the company matching contributions in AMZN shares rather than switch to other investments.

Coming in second place is the low-cost Vanguard Institutional 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 next five largest holdings are all Vanguard target retirement funds. These funds are designed to shift the underlying asset allocation within the fund as the target retirement year approaches—shifting to more bonds and fewer equities. In other words, they become more conservative as time passes. The largest of these holdings is the Target Retirement 2045 Trust, designed for people planning to retire around the year 2045.

Plan assets as of 12/31/2016 (from the October 2017 filing of Form 5500)

Investment Value ($000) %
Amazon.com (company stock)  $          649,672 23%
Vanguard Institutional Index Fund  $          288,049 10%
Vanguard Target Retirement 2045 Trust I  $          257,007 9%
Vanguard Target Retirement 2050 Trust I  $          216,348 8%
Vanguard Target Retirement 2040 Trust I  $          205,603 7%
Vanguard Target Retirement 2035 Trust I  $          176,042 6%
Vanguard Target Retirement 2055 Trust I  $          121,967 4%
T. Rowe Price Institutional Large Cap Growth Fund  $          105,091 4%
Vanguard Target Retirement 2030 Trust I  $           95,885 3%
Vanguard Total International Stock Index Fund  $           84,830 3%
Vanguard Target Retirement 2025 Trust I  $           79,748 3%
Vanguard Retirement Savings Trust III  $           70,160 2%
All other  $          490,005 17%
Total Assets  $      2,840,407 100%
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