401(k) Champions and Soaring Value Stocks

**Robert Brokamp** (0:03)
Are you a 401k champion to your friends and colleagues? And what's really in your value front? That and more on this Saturday Personal Finance Edition of the Motley Fool Hidden Gems Investing Podcast.
I'm Robert Brokamp, and this week I speak with financial advisor Julie Jason, the creator of the 401k champion award that recognizes people who serve as role models, educators and mentors in the workplace when it comes to saving for retirement. But first, some items that caught my eye over the past week or so. When you think of value stocks, what kind of companies come to mind? If visions of stodgy, slower growth firms dance in your head, then you may be surprised to know that value stocks are actually outperforming the S&P 500 so far this year and over the trailing 12 months, at least as measured by the Vanguard value ETF ticker VTV, the largest value ETF in the US. It's up 16 percent so far in 2026 as of this taping on Friday morning compared to 8 percent for the S&P 500, and it's up 29 percent over the past year versus 22 percent for the S&P 500
Given all the hullabaloo about AI and tech stocks, how can value stocks be doing so well? Look under the hood and you'll see the answer. The top holding in the Vanguard value ETF is Micron Technology, which is up 854 percent over the past year. Also in the top 10 holdings are Cisco and Intel, up 77 percent and 499 percent respectively over the trailing 12 months. You'll find those same stocks in the top 10 holdings of another popular value index ETF, the iShares Russell 1000 value ETF, ticker IWD, but it also includes Alphabet, which is up 102 percent over the past year. A recent report from Schroeder Investment Management cited evidence that value stocks can actually be a good hedge against AI risk without sacrificing equity exposure, but the report also cautions that a passive value index fund may not fit the bill, since many of the prominent value indexes have significant exposure to the Magnificent 7 and or other technology companies as we've just seen, so you might have to dig a little deeper to find true value stocks these days. Our next item comes from a CNBC article by Annie Nova, which highlights a recent announcement from the Department of Education. Student loan borrowers who sign up for auto pay will receive a 1 percentage point discount on their interest rates starting July 1, up from the current 0.25% discount. According to the article, only 40% of student loan borrowers are enrolled in auto pay, down from more than 80% before the pandemic. Borrowers need to sign up by September 30, and the discount will last through June of 2028 It likely won't result in an enormous savings, but every little bit helps. Around 42 million Americans hold federal student loans nowadays, owing more than $1.6 trillion, exceeding the $1.1 trillion Americans owe on credit cards. And now the number of the week, which is 6.6%.
That is the median amount that workers are contributing to 401Ks administered by Vanguard, according to the firm's latest How America Saves report. Throw in employer contributions, and the median contribution rate is 11.6%.
That number has slowly crept up over the past five years or so, but it is still below the 15% savings rate that many experts recommend. A few other interesting stats from the report. 14% of workers contribute the maximum to their accounts. 17% of workers age 50 and older are making catch-up contributions. And 18% of workers are contributing to Roth accounts, which frankly to me seems a little low. More workers should probably be putting at least some of their 401k money into Roths.
Do you have above average knowledge about 401ks? And have you ever shared it with your colleagues? That's our next topic of conversation when Motley Fool Hidden Gems Investing continues.

**Parker Posey** (3:59)
Hey, it's Parker Posey. How did I get here? I love improvisation when it comes to acting, but when it comes to a real life plan, I stick to a script. Cue the music.

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**Robert Brokamp** (4:31)
Primary way that Americans save retirement is through a work-sponsored plan such as a 401k. Most of the education about that plan comes from the employer or the plan provider. But it doesn't have to be that way. You yourself could be a source of knowledge and encouragement to your colleagues, friends, and relatives. Here to explain how is Julie Jason, the founder and CEO of Jackson Grant Investment Advisors, and the creator of the annual 401k Champion Award. Julie, welcome to the show.