• Amid the market turmoil, 401(k) participant activity was high and transfers were significant out of equities during September, according to the results of the Hewitt 401(k) Index™. A total of $921 million moved out of equities and into fixed income investments during the month. The directions of the transfers were fixed income oriented during 76% of the total days, and nearly all of the days in the second half of the month.
  
• While activity was relatively high, the vast majority of 401(k) participants stayed calm. The overall transfer activity level in September was only slightly higher than the average transfers of the trailing 12 months — 0.06% of balances were transferred on a net daily basis in September versus 0.05% of balances transferred during the past year.
  
• Five days of the month had above normal* level of transfers, with four out of the five days showing up in the latter half of the month. All four days were strongly fixed income oriented and followed significant market drops. On September 16th, the day following the news of the collapse of Lehman Brothers and the credit-rating downgrade of AIG, the index transfer activity was nearly three times as high as the usual level — with 0.13% of balances transferred. On September 29th, the financial rescue plan was defeated on Capitol Hill and the markets broadly dropped, and participant transfers were 2 to 3 times the normal levels on the following two days.
  
• The three fixed income asset classes received nearly the entire inflows (96%) in September. Approximately $733 million moved into GIC/stable value funds, representing 68% of the net transfers in September. Bond and money market funds also received $178 million (16% of net transfers) and $133 million (12% of net transfers), respectively.
  
• As the MSCI EAFE Index declined over 14% in September, international funds experienced the largest outflows, with nearly $330 million transferring out of this asset class. Large U.S. equities also experienced $234 million in outflows, followed by lifestyle funds ($141 million) and balanced funds ($137 million).
  
• For the third quarter, a total of $1.9 billion moved from equities to fixed income investments, mainly from international funds ($700 million) and U.S. equities ($478 million) into stable value funds ($1.7 billion).
  
• Due to both participant transfers and market decline, participants' overall equity exposure has dropped to its lowest level since April 2003, at 58.8%. It was down by 3.7% for the quarter.
  
• Employee equity contributions (participant discretionary contribution) also declined 2.9% during the quarter to 62.4% by the end of September.

*A "normal" level of relative transfer activity is when the net daily movement of participants' balances as a percent of total 401(k) balances within the Hewitt 401(k) Index equals between 0.3 times and 1.5 times the average daily net activity of the preceding 12 months. A "high" relative transfer activity day is when the net daily movement exceeds two times the average daily net activity. A "moderate" relative transfer activity day is when the net daily movement is between 1.5 and two times the average daily net activity of the preceding 12 months.

The following tables show Hewitt 401(k) Index statistics and the returns of major market indices for the month of September 2008:

Dow Jones IA	-5.83%
Russell 2000	-7.97%
Lehman Aggregate	-1.34%
S&P 500	-8.91%
MSCI EAFE	-14.46%
NASDAQ	-12.05%

Number of Fixed Income Days	16
Number of Equity Days	5
Percent of Equity Days	24%