PSCA Study Shows Retirement Plan Participation Rates Rising
CHICAGO, IL, May 21, 2018, 2018 -- The percentage of employees signing up and making contributions to their qualified retirement plan has risen almost ten percent since 2010 according to the Plan Sponsor Council of America's (PSCA) 60th Annual Survey of Profit Sharing and 401k Plans. PSCA, part of the American Retirement Association, found 84.9 percent of employees made contributions to their plan in 2016 compared to 76.9 percent in 2010.
"In addition to widespread adoption of automatic features such as automatic enrollment and auto-escalation, companies are taking a variety of steps to increase participation and their combined efforts over time are having an effect," said Research Director Hattie Greenan.
New and innovative plan administration practices are now more widespread. The Survey found 31.7 percent of all plans offer balance inquiries via mobile technology, 26.2 percent of plans allow contribution changes, and 25.6 percent approve investment changes via mobile technology. Tracking the use of mobile technology first appeared in the 58th Annual Survey, which found the following: 19.6 percent of all plans offer balance inquiries, 12.6 percent of plans allow contribution changes, and 12.2 percent approve investment changes via mobile technology.
In addition to the increased use of mobile technology for plan administration, the percentage of companies that provide a robo-advisor to participants is increasing, especially in plans with more than 5,000 participants. The Survey found 10.1 percent of all plans provide a robo-advisor for participants, whereas 17 percent of plans with 5,000 or more offer robo-advisors. Overall, 14 percent of companies were considering adding robo-advisors as an option for their participants.
"Plan sponsors are becoming especially creative as they try to increase participation," said PSCA Executive Director Jack Towarnicky. "Companies are finding new ways to connect with plan participants, and the results of their efforts are paying off."
PSCA's 60th Annual Survey reflects the 2016 plan-year experience of 590 DC plan sponsors. The full survey is available to order as a hard-copy bound book or a PDF. It contains 182 tables of data covering topics such as Roth IRAs, automatic enrollment, and default deferrals.
About the Plan Sponsor Council of America
The Plan Sponsor Council of America (PSCA), a part of the American Retirement Association (ARA), is a diverse, collaborative community of employee benefit plan sponsors, working together on behalf of millions of employees to solve real problems, create positive change, and expand on the success of the employer-sponsored retirement system. With members representing employers of all sizes, we offer a forum for comprehensive dialogue. By sharing our collective knowledge and experience as plan sponsors, PSCA also serves as a resource to policymakers, the media and other stakeholders as part of our commitment to improving retirement security for millions of Americans. For more information, visit www.psca.org.
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