COLLECTED WISDOM™ on Studies, Surveys, and Research focused on 401k Plans

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2024 Defined Contribution Survey

The 2024 Defined Contribution Survey indicates a slight decrease in capital flows to real estate funds, with a drop of $700 million in 2023. Despite this decline, two-thirds of real estate investment managers reported net increases in flows from defined contribution plan investors. The overall net decline in capital flows was attributed to just one-third of firms. The survey, produced by NAREIM in collaboration with the DC Real Estate Council, NCREIF, and PREA, assesses inflows and redemptions related to private real estate vehicles, open-ended funds, and targeted strategies. By the end of 2023, over $36 billion of DC capital was invested in real estate strategies, as detailed in the 2024 survey.

Source: Nareim.org, March 2025

State of Retirement Planning: Fidelity Study

As more Americans approach retirement age in 2025, the latest Fidelity Investments State of Retirement Planning study reveals a growing sense of concern. While 67% of Americans in their planning years feel confident about their retirement, this is a decline of seven percentage points from the previous year, primarily due to ongoing inflation and rising living costs. Despite over 70% of recent retirees reporting that their retirement is proceeding as planned, many are surprised by increased expenses, especially in healthcare. The study, which has been conducted since 2019, compares the expectations and realities of individuals nearing retirement and those recently retired, highlighting the challenges faced during this critical period as a record number of Americans approach the traditional retirement age of 65.

Source: Thenewsmarket.com, March 2025

2025 Study on Advisor Attitudes Toward 3(16) Fiduciary Outsourcing

The "Advisor Attitudes Toward 3(16) Fiduciary Outsourcing" survey, conducted by Pentegra in January 2025, explored how over 50 advisors utilize fiduciary outsourcing to enhance retirement plan management for clients. It highlighted the benefits of outsourcing these responsibilities, such as improved compliance and risk mitigation for clients, while allowing advisors to concentrate on their core business operations. Carlo Guerrera, Vice President of Sales and Key Accounts, emphasized that outsourcing 3(16) fiduciary duties to professionals is considered a best practice that provides significant advantages to both advisors and their clients.

Source: Pentegra.com, March 2025

Vanguard Sees All-Time High Deferral Rates, Plan Design Improvements in 2024

Vanguard's preview of the "How America Saves 2025" report reveals that participant outcomes for defined contribution retirement plans remained strong in 2024. Key findings include a 10% increase in average account balances, largely due to positive market performance, and a record high of 45% of participants raising their deferral rates, either voluntarily or through automatic increases. Jeff Clark, head of defined contribution research at Vanguard, highlighted that plan designs are at their strongest, noting a consistent annual rise in the adoption of automatic enrollment over the past 20 years.

Source: Plansponsor.com, March 2025

2025 DC Survey: Plan Provider Service Ratings

Recordkeeper satisfaction among defined contribution plan sponsors is generally high, with an average Net Recommendation/Promoter Score exceeding 8 on a scale of 1 to 10, according to PLANSPONSOR's DC Survey. Jeff Cullen, CEO of Strategic Retirement Partners, notes that most of his clients are satisfied with their current providers and few are seeking alternatives. He emphasizes that "quality of service" and a "true partnership philosophy" are critical factors when choosing a recordkeeper. Cullen points out that variations in client experiences often stem from the quality of personnel assigned to their accounts, highlighting an area for potential improvement.

Source: Plansponsor.com, February 2025

Retirement Plan Participation, by Race/Ethnicity, 2023

This 6-page paper analyzes employment-based retirement plan participation data from the Current Population Survey, which started incorporating new retirement account variables in 2019. This data is beneficial because it focuses on individual workers rather than employers, allowing for a nuanced understanding of retirement participation based on worker characteristics. The study specifically explores variations in retirement plan participation among different racial and ethnic groups, while also considering how factors such as income, age, education, gender, and employer size influence these differences.

Source: Ebri.org, February 2025

DC Retirement Plan Balances and Contributions Rising, Fidelity Reports

Fidelity Investments reported that retirement account balances reached record highs in the latter half of 2024, with an average of $132,300 in 401ks and $119,300 in 403bs. Contribution rates are also rising, approaching Fidelity's 15% savings guideline. More than two-thirds of employees (69%) and employers (67%) view retirement plans as essential benefits. In 401k plans, the average total contribution is 14.1%, with employers contributing 4.7% and employees 9.4%. For 403b plans, the average total contribution is 11.8%, comprising 3.3% from employers and 8.5% from employees.

Source: Planadviser.com, February 2025

How Do Middle Class Americans Feel About Retirement?

Most middle-class Americans aspire to a long, fulfilling life and a comfortable retirement, which is integral to the American Dream. Representing about half of the U.S. population, the middle class is crucial for the economy, as consumer spending accounts for two-thirds of the U.S. GDP and drives growth. Insights into middle-class Americans' perceptions of retirement are highlighted in the 24th Annual Transamerica Retirement Survey, which explores their health, employment, finances, and outlook on retirement. This article reviews a few key findings from the survey.

Source: Spconsultants.com, February 2025

DC Retirement Plan Balances and Contributions Rising, Fidelity Reports

Fidelity Investments has reported record-high retirement account balances in the latter half of 2024, with the average 401k balance reaching $132,300 and the average 403b balance at $119,300. Contribution rates are also increasing, getting closer to Fidelity's recommended 15% savings rate (including both employer and employee contributions). According to Fidelity's 2025 workplace outlook report, 69% of employees and 67% of employers view retirement plans as essential benefits. In 401k plans, employers contribute an average of 4.7% of pay, while employees contribute 9.4%, totaling 14.1%. In 403b plans, employer contributions average 3.3%, and employee contributions average 8.5%, resulting in a total of 11.8%.

Source: Planadviser.com, February 2025

Study Finds Most Corporate Retirement Plans Have Regulatory or Fiduciary Violations

A study by Abernathy Daley 401k Consultants found that 84% of retirement plans exhibit at least one potential violation of ERISA that may expose them to regulatory risks or indicate fiduciary failure. Examining over 764,000 Form 5500 filings, the analysis identified "red flag violations" in two categories: regulatory infractions, which were present in 43% of companies, and egregious plan mismanagement, found in 76% of American companies. As a result, Abernathy Daley estimates that over 600,000 U.S. companies could face potential fines, legal penalties, and fiduciary issues.

Source: Planadviser.com, February 2025

American Views on Defined Contribution Plan Saving: 2024

The Investment Company Institute conducted a survey to track the actions and sentiments of retirement savers in the U.S. This report, the 17th in their series, is based on a nationwide survey of adults aged 18 and older, performed by NORC at the University of Chicago between November and December 2024. Findings reveal that Americans highly value 401k plans for their discipline and investment potential. Respondents generally oppose changes to the tax treatment or investment control of these accounts and prefer to maintain control over their retirement savings. Additionally, a majority expressed opposition to proposals that would require part of their retirement accounts to be converted into income guarantees managed by the government or insurance companies.

Source: Ici.org, January 2025

Understanding and Enhancing the Workforce Impact of Retirement Plans

Human capital is increasingly recognized as a vital source of competitive advantage, with retirement plans playing a crucial role in maximizing the value derived from this capital. This report emphasizes the importance of assessing retirement plans not only in terms of their costs and risks but also in their contributions to organizational success. To evaluate the impact of retirement plans, the report presents a comprehensive framework consisting of 10 key considerations framed as context-specific questions. The framework is intended to be action-oriented, helping organizations identify necessary changes, particularly for critical employee segments. The report includes case studies demonstrating successful implementations of the framework, highlighting potential risks associated with not adequately considering the impacts of retirement strategy changes.

Source: Soa.org, January 2025

Defined Contribution Plan Profile: A Close Look at ERISA 403b Plans, 2021

The BrightScope/ICI Defined Contribution Plan Profile is a research initiative by BrightScope and the Investment Company Institute that analyzes audited Form 5500 data from private-sector DC plans. It provides insights into DC plan design, including investment options, employer contributions, automatic enrollment features, and recordkeeping practices. The research draws from the BrightScope Defined Contribution Plan Database and includes analysis of employer contribution structures and associated fees, enhancing understanding of retirement savings. The current report focuses on ERISA 403b plans in 2021, examining data from the Department of Labor's 2021 Form 5500 Research File and nearly 6,300 audited plans in the BrightScope database.

Source: Ici.org, January 2025

PSCA Survey Finds Good News on 401k Savings and Participation Rates

In 2023, contribution rates for 401k plans saw modest increases as both employers and participants contributed more after a decrease the previous year. This information comes from the Plan Sponsor Council of America's 67th Annual Survey of Profit Sharing and 401k Plans, which analyzed the plan-year experience of 709 401k plans. While contributions are not yet back to the record highs of 2021, the uptick indicates a positive shift in participation and funding.

Source: Napa-net.org, December 2024

Top 10 Highlights from PSCA's Newest Survey of 401k Plans

In 2023, 401k plan contribution rates saw a modest increase as both employers and participants contributed slightly more than the previous year, although they have not yet returned to the record highs of 2021. This information is derived from the 67th Annual Survey of 401k Plans by The Plan Sponsor Council of America (PSCA). The survey indicates a rise in contributions, coinciding with plan sponsors focusing on the implementation of mandatory provisions from SECURE 2.0, along with decisions on optional provisions. Hattie Greenan, PSCA's director of research and communications, noted the dual focus of maintaining contributions while incorporating design features to support participant financial needs. This outlines the top 10 highlights from the survey.

Source: 401kspecialistmag.com, December 2024

Debt is Limiting American Retirement Savings

According to the 2024 Annual Retirement Study conducted by Allianz Life Insurance Company, a significant number of Americans are prioritizing debt repayment as they strive to secure their long-term financial goals. Notably, 55% of respondents are actively working to pay off debts, with Generation X leading this effort—64% of Gen Xers are focusing on debt reduction compared to 54% of both millennials and boomers. The article notes further that many Americans acknowledge that their debt is a barrier to retirement savings. Among those who wish they had saved more, 46% cite non-housing debts, such as car loans, credit cards, and student loans, as impediments to saving.

Source: Allianzlife.com, December 2024

2024 Defined Contribution Consultant Study

T. Rowe Price's fourth annual Defined Contribution Consultant Study gathered insights from the defined contribution consultant and advisor community regarding current retirement perspectives. The study, conducted from January 12 to March 4, 2024, involved 35 leading consultant and advisor firms, which together manage over $7.5 trillion in assets. Key findings continued to highlight areas such as target date solutions, retirement income, investment trends, and financial wellness programs. New topics introduced this year included managed accounts, alternative investments, and comparisons of active versus passive management strategies.

Source: Troweprice.com, November 2024

Schwab 401k Study: Employers Step Up to Help Workers Manage Financial Stress

The Charles Schwab 401k Study reveals that employers are increasingly taking proactive steps to assist employees in managing financial stress, particularly in the context of retirement savings. The study highlights a growing awareness among employers of the impact that financial difficulties can have on employee well-being, productivity, and overall job satisfaction. In response, many organizations are implementing resources and support systems, such as financial wellness programs and educational tools, to empower workers in their financial decision-making. The findings emphasize the significant role that employers play in fostering a supportive environment that promotes financial literacy and stability, ultimately benefiting both employees and the organizations they work for.

Source: Schwab.com, October 2024

GAO on 401k Plans: Reported Impacts of Fee Disclosure Regulations, and DOL Efforts to Support Implementation of Regulations

The GAO report emphasizes the significance of employer-sponsored 401k plans for retirement savings, highlighting the role of mandatory fee disclosures by the Department of Labor. Since 2012, 401k plan fees have generally decreased, with various factors -- including fee disclosures -- contributing to this trend. The DOL implemented fee disclosure regulations in 2010 and 2012 to enhance awareness among plan sponsors and participants regarding fees and investment performance. Overall, while fee disclosures have positively influenced the management of 401k plans, enhancing financial literacy among participants may further improve their engagement and understanding.

Source: Gao.gov, October 2024

4 in 10 Taking Early 401k Withdrawals; 2 in 3 Not Paying It Back

Research from FinanceBuzz reveals that 40% of Americans with retirement accounts have made early withdrawals, with over 10% doing so multiple times. Additionally, two-thirds of those who withdrew have not repaid the full amount. The study, based on a survey of 1,000 U.S. adults, aimed to examine the prevalence of early withdrawals, the amounts taken out, and the reasons behind these financial decisions.

Source: 401kspecialistmag.com, October 2024

Small Plan Balance Cashouts and Missing Participants

Plan sponsors often find managing missing participants and distributing plan balances a significant administrative challenge. While there are no strict regulations governing how to handle small balances from terminated employees, this issue is a common focus during DOL audits. The DOL expects plan sponsors to implement a prudent process and demonstrate a good-faith effort in distributing funds to ex-participants. To understand current practices, the PSCA conducted a survey in September 2024, sponsored by Inspira, gathering responses from 234 plan sponsors from various sizes and industries.

Source: Psca.org, October 2024

Retirement Income and Personalization Among Key 2024 DC Trends

As lifetime income solutions continue to trend upward, plan sponsors are inquiring more about retirement income in workplace plans. New findings from T. Rowe Price's Defined Contribution Consultant Study, which explores the latest retirement plan and investment attitudes from DC advisors and consultants, show that more employers have an opinion about retirement income today compared to past years.

Source: 401kspecialistmag.com, September 2024

What Are the Key Trends Affecting DC Plans?

Retirement income is at the center of trends discussed in a new study that evaluates the viewpoints of 35 leading consultant and advisory firms on key retirement and investment trends affecting DC plans and their sponsors. The study captures the latest perspectives from DC consultants and advisors on target-date solutions, retirement income, investment trends, and financial wellness programs. Additionally, this year's study explores respondents' thoughts on managed accounts, alternative investments, and the value of active versus passive management.

Source: Psca.org, September 2024

Read on Retirement: Advisor Perspective

Retirement. It's deeply personal. And nobody knows this better than the retirement plan advisors working first-hand with sponsors to understand and address the challenges their savers face. Blackrock surveyed over 300 advisors as part of its annual "Read on Retirement®" research to better understand how they're enhancing outcomes and growing their practice. This is a 12-page report.

Source: Blackrock.com, September 2024

Reinventing Retirement Recordkeeping

The retirement recordkeeping industry is presented with both significant challenges and opportunities for transformation. This dynamic environment calls for strategies that could include scaling up or targeting specific market segments, delivering comprehensive financial advice services, and introducing personalized products. By leveraging emerging technologies such as generative AI, and building a strong digital core, recordkeepers could achieve a lean cost structure and adapt to the changing and consolidating landscape. This is a 20-page report.

Source: Accenture.com, September 2024

How Financial Factors Outside of a DC Plan Can Impact Retirement Readiness

This research found that, like private-sector DC plan participants, public-sector DC plan participants who lack income and cash reserves to support a spending spike are likely to end up with more credit card debt. This higher debt can have a long-lasting impact on retirement security since higher credit card utilization is correlated with lower DC plan contributions and account balances, even when controlling for income. Thus, the availability of emergency savings to cover spending spikes can be a critical factor in preventing or stalling a cycle of increasing debt that can significantly impact retirement readiness.

Source: Ebri.org, September 2024

Just 42% of U.S. Workers Confident They're Saving Enough for Retirement: Survey

Just two-fifths (42%) of U.S. employees say they feel highly confident they're on track to save what they need in retirement, according to a new survey by LiveCareer. The survey, which polled more than 1,000 U.S. workers, found six in 10 said they fear retirement more than death (61%) or the idea of getting a divorce (64%). Indeed, 39% expressed fear that retiring will make them a financial burden to loved ones or that they won’t have enough saved for medical emergencies or unexpected costs in retirement.

Source: Benefitscanada.com, September 2024

Sports Betting Legalization a Big Loser for Retirement Balances

Talk about your losing propositions! A new study from the University of Kansas found that every dollar spent on online sports betting translates into two dollars not invested in retirement savings. A new working paper shows how the proliferation of online sports betting since a 2018 Supreme Court ruling that paved the way for states to legalize sports gambling has not only led to increased betting activity, but also leads to higher credit card balances (and more paid in interest charges), less available credit, and a reduction in net investments.

Source: 401kspecialistmag.com, September 2024

401k Plan Participants Continue to Benefit From Employer Contributions and Falling Fees: Report

The undeniable strength of the 401k system is seen in this report. Analyzing automatic enrollment, employer contributions, and participant loans, the report reveals the care with which employers set up their 401k plans, and how employer contributions and cost-effective investing bolster the success of the system in helping Americans save for retirement.

Source: Ici.org, August 2024

Financial Uncertainty Pushes Americans to Rethink Retirement Plans

As retirement approaches for millions of Americans, the path forward appears increasingly uncertain, with many expressing concerns about how they will generate income in their post-work years. Amid this uncertainty, many workers appear to be delaying their retirement plans. The 2024 Global Benefits Attitudes Survey from WTW found that financial concerns are leading older Americans to work longer or phase into retirement gradually.

Source: Planadviser.com, August 2024

Why Do Employers Establish Retirement Savings Plans? Evidence From State "Auto-IRA" Plans

Several states have recently attempted to boost retirement savings by enacting "auto-IRA" plans that require employers not currently offering an employer-sponsored retirement plan (ESRP) to either (1) establish an ESRP or (2) enroll employees in state-facilitated Individual Retirement Accounts. This 63-page paper identifies the effect of these state retirement plan mandates on a firm's decisions to offer ESRPs, treating the gradual rollout of these policies across states and employer size categories as a series of "experiments."

Source: Nber.org, August 2024

Schwab 401k Study: Confidence Among Workers Improves as Inflation and Market Volatility Concerns Soften

Workers are feeling more confident about their ability to reach their financial goals for retirement as anxiety around inflation and market volatility has come down since last year, according to a new survey from Charles Schwab. The annual nationwide survey of 401k plan participants finds that 43% of workers think they are very likely to achieve their retirement savings goals compared to 37% in 2023. Inflation and stock market volatility continue to be the biggest obstacles to saving for a comfortable retirement, though workers are slightly less concerned about both factors in 2024.

Source: Schwab.com, July 2024

The Economics of Providing 401k Plans: Services, Fees, and Expenses, 2023

401k plan participants investing in mutual funds tend to hold lower-cost funds. At year-end 2023, 401k plan assets totaled $7.4 trillion, with 38 percent invested in equity mutual funds. In 2023, 401k plan participants who invested in equity mutual funds paid an average expense ratio of 0.31 percent. The mutual fund expense ratios that 401k plan participants incur have declined substantially since 2000. In 2000, 401k plan participants incurred an average expense ratio of 0.77 percent for investing in equity mutual funds. By 2023, that figure had fallen to 0.31 percent, a 60 percent decline.

Source: Ici.org, July 2024

2024 Living in Retirement Report

Findings on the financial challenges and concerns of retired Americans from the Schroders 2024 US Retirement Survey. Study finds inflation taking a toll on retirees. The worst bout of inflation in decades is weighing heavily on the minds of retirees.

Source: Schroders.com, July 2024

2024 US Retirement Readiness Report

Schroders recently surveyed 2,000 US investors nationwide to learn more about the state of retirement readiness and planning, key concerns regarding retirement, and current sentiment among those who are already living in retirement.

Source: Schroders.com, July 2024

2024 Recordkeeping Survey

Significant levels of change in federal law regarding employer-provided retirement plans, including a variety of new optional and mandatory provisions enacted since 2019, have put tremendous pressure on plan recordkeepers after years of fee compression. The 2024 PLANSPONSOR survey found that recordkeepers are juggling competing priorities of new mandatory and optional plan features alongside demands for their platforms to support retirement income, personalization, financial wellness programs, and more.

Source: Plansponsor.com, June 2024

Improving Retirement Outcomes: Demographic Considerations

This 34-page policy paper discusses retirement inequities and how current retirement plan design elements and policies may inadvertently disadvantage certain cohorts of individuals. It offers potential changes and actions for consideration by policymakers, think tanks, actuaries, and employers/plan sponsors to improve retirement outcomes for groups facing inadequate retirement security under common designs. The paper concludes with considerations for further effort, research, and studies.

Source: Actuary.org, June 2024

How America Saves 2024

Here is a report on the current state of defined contribution plans in America. How does your plan stack up? The comprehensive plan data in "How America Saves 2024" puts the trends of the retirement industry right at your fingertips so you can stay current, create stronger plans, and provide better participant outcomes.

Source: Vanguard.com, June 2024

New Research Finds Substantial Growth in Individual Account Retirement Plan Assets

A new research report published today by the Employee Benefit Research Institute found that after modest growth and declines in individual account retirement plan ownership and assets from 2016 to 2019, there was substantial growth from 2019 to 2022.

Source: Ebri.org, June 2024

Study Reveals How Fiduciary Advice Reduces 401k Plan Costs

Employee Fiduciary has released its latest 401k advisor fee study. The study highlights how fiduciary-grade investment advice can lower the cost of small business 401k plans, making retirement more affordable for plan participants. The study looks at the fees charged by 1,109 fiduciary-grade financial advisors to demonstrate how affordable a small business 401k plan can be with fiduciary-grade investment advice.

Source: Prnewswire.com, May 2024

Gender Lens in Defined Contribution Plans

The adverse economic consequences of the pandemic disproportionally affected women. Women have dropped out of the workforce at record numbers to take on additional caregiving responsibilities. This study using, data from 2019 to 2023, shows that: Participation rates of women remain lower than those of men. Women and men contribute at the same rates. Women continue to invest more conservatively. However, both women's and men's allocations to equity have increased. Women continue to claim hardship at greater rates and have higher loan-to-balance ratios than men. 401k balances of women continue to lag behind those of men.

Source: Bofa.com, May 2024

Nearly Half of Americans Expect Slow Transition Into Retirement

Americans' view of retirement is shifting as nearly half of Americans think about retirement as a slow transition away from full-time work rather than a distinct day in the future to leave the workforce, according to the 2024 Annual Retirement Study from Allianz Life. While 47% of Americans say they think about retirement as a slow transition away from full-time work, only 38% now say they think about it as a distinct date in the future to stop working and start drawing down on retirement assets. At the same time, 15% say they don't see themselves ever slowing down or retiring.

Source: Allianzlife.com, May 2024

401k Plan Asset Allocation, Account Balances, and Loan Activity in 2022

In an ongoing collaborative effort, the Employee Benefit Research Institute and the Investment Company Institute collect annual data on millions of 401k plan participants as a means of examining how these participants manage their 401k plan accounts. This 32-page report is an update of EBRI and ICI's ongoing research into 401k plan participants' activity through year-end 2022. The report is divided into three sections: the first presents a snapshot of participant account balances at year-end 2022, the second looks at participants' asset allocations, and the third focuses on participants' 401k loan activity.

Source: Ebri.org, April 2024

Callan 2024 DC Trends Survey: Focus on Plan Governance, and Continued Efforts to Rein in Fees

Callan's 2024 Defined Contribution Trends Survey covers the key tenets of DC plan management such as governance, investments, fees, plan design, and more. The insights distilled in the 17th annual edition of the survey provide a benchmark for sponsors to evaluate their plans compared to peers, and to offer actionable information to help them improve their plans and the outcomes for their participants. This article summarizes highlights from the survey, which was conducted online in late 2023.

Source: Callan.com, April 2024

Improving DC Plans to Serve Participant Behavior

Overall, the study revealed the complex nature of solving for the diverse styles of DC participants and underscored the importance of investment solutions that can be more broadly applicable to more retirement income styles, or how retirees prefer to source spending in retirement. In addition, the study highlighted the importance of engagement, education, and spending guidance in matching strategies with the preferences of different savers and the opportunity for the DC industry to do more in providing individuals with further spending guidance.

Source: Blackrock.com, April 2024

One-Third of American Workers Have Zero Retirement Savings

Americans workers are not in the position to retire anytime soon, finds a new Q2 report by Schroders. The "DC Lens Q2 2024" report underlines some bleak updates to the state of participants' retirement readiness. According to the analysis, 28% of people have zero savings for their retirement, 39% are not contributing to a retirement fund, and 30% don't see a future where they can retire.

Source: 401kspecialistmag.com, April 2024

Nine Key Findings from EBRI's 2024 Retirement Confidence Survey

Workers' and retirees' confidence has not yet fully recovered from the significant drop seen in 2023, but majorities remain optimistic about their retirement prospects and the lifestyle they envisioned, according to the 34th annual Retirement Confidence Survey, published by the Employee Benefit Research Institute and Greenwald Research. Here are some of the key findings from the survey of 2,521 Americans.

Source: 401kspecialistmag.com, April 2024

Understanding the Drivers of Retirement Confidence

Dynata, an independent third-party research provider, conducted a study among 1,000 DC plan participants in the US on behalf of MFS. In this article, MFS shares the responses from the participants in three sections: market event impacts, retirement confidence, and the power of quality advice.

Source: Plansponsor.com, April 2024

Report Reveals 403b Plan Sponsors Support Retirement Saving and Investing

Employers' commitment to their 403b plan participants is evident in a new report just released by the ICI. Analyzing the plan year 2020 data for large 403b plans filing Form 5500 under the ERISA, the report finds that nearly one-third of large ERISA 403b plan participants were in plans that put their employees on the path to retirement saving with automatic enrollment.

Source: Ici.org, April 2024

Why Do Some Small Businesses Offer Retirement Plans?

Numerous studies have shown that offering a retirement plan is closely related to firm size; firms with fewer than 100 employees are much less likely to offer a plan than larger firms. As a result, observers tend to dismiss small firms as a source of future growth in coverage. However, a meaningful share of small businesses do offer retirement plans. The purpose of this study is to identify the characteristics of sponsoring firms and their employees to determine which small businesses may be more likely to offer a retirement plan in the future.

Source: Bofa.com, April 2024

Nearly 2 in 3 Americans Worry More About Running Out of Money Than Death

Nearly two in three Americans say they worry more about running out of money than death with concerns about inflation, Social Security, and taxes contributing to the fear, according to the 2024 Annual Retirement Study from Allianz Life. The worry of running out of money has increased in recent years. In 2024, 63% say they worry more about running out of money than death, up from 57% in 2022. Gen Xers are the most likely to say this with 71% more worried about running out of money than death, compared to 64% of millennials and 53% of boomers.

Source: Allianzlife.com, April 2024

401k Balances Rise 14% in 2023, but Participation Rate Falls

Average 401k account balances at plans recordkept by T.Rowe Price increased by 14% over the past year to $115,000, according to the Baltimore-based company's annual benchmarking report on 401k plan design and participant behavior.

Source: 401kspecialistmag.com, April 2024

Small Business Retirement Plans: How Firms Perceive Benefits and Costs

At any given time, only about half of U.S. private sector workers are covered by an employer-sponsored retirement plan, and few workers save without one. The coverage gap, which undermines the retirement security of the nation's workers, is driven by a lack of coverage among small employers. This article presents the results of a new survey of small employers to understand why some offer retirement plans and others do not.

Source: Bc.edu, March 2024

Redefining 401k Data Collection for Racial and Gender Groups

A new study released today is shifting the way participant data is collected across the retirement planning industry. The research highlights gender and race-focused defined contribution administrative data typically found in human resource systems, with the hopes of combining it with qualitative research to better assess wellness platforms and tools for employers and participants. According to the research, data on nonwhite households remains relatively small with limited information on contributions, loans, and withdrawal and asset allocation activity.

Source: 401kspecialistmag.com, March 2024

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