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

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Retirement Planning Among Middle-Aged and Older Hispanics

Summary: The goal of this study is to deepen the understanding of how middle age and older Hispanics plan for retirement. It finds that that most participants, whether they were already retired or not, are not well prepared for retirement since they have been unable to save for retirement and have not made specific retirement plans.

Source: Ssrn.com, March 2015

Current U.S. Retirement Savings Deficit is $4.13 Trillion

Summary: EBRI releases data showing that the aggregate national retirement savings deficit is about $4.13 trillion for all U.S. households where the head of the household is between 25 and 64, inclusive.

Source: Ebri.org , March 2015

401k Participant Behavior in a Volatile Economy

Summary: The booms and busts of the late 1990s and 2000s have taken 401k plan participants on a rollercoaster ride. Paper examines how participants responded to these periods of economic expansions and contractions by documenting changes in 401k participation, contributions, and contribution rates from 1990 to 2009.

Source: Urban.org, March 2015

Retirement Security 2015: Roadmap for Policy Makers

Summary: The National Institute on Retirement Security commissioned its fourth nationwide public opinion research project monitor how Americans feel about their financial security in retirement and to assess their views on policies that could improve their retirement outlook. This research is intended to serve as a tool for policymakers, thought leaders and retirement service providers as they work to stem the retirement crisis and re-fortify the U.S. retirement infrastructure.

Source: Nirsonline.org , March 2015

Racial Disparities in 401k Savings Behavior

Summary: This paper examines 401k saving behavior of continuously employed workers over an eight-year period at a single, geographically diverse employer. Paper demonstrate substantial difference in 401k savings behavior by employee ethnicity even within a single employer 401k plan architecture.

Source: Nber.org, February 2015

Defined Contribution Plan Participants Activities, First Three Quarters of 2014

Summary: Key findings include: (1) DC plan withdrawal activity in the first three quarters of 2014 remained low and was similar to the activity observed in 2013. (2) The commitment to contribution activity in the first three quarters of 2014 continued at the high rate observed 2013. (3) Most DC plan participants stayed the course with their asset allocations. (4) DC plan participants' loan activity remains elevated compared with six years ago.

Source: Ici.org , February 2015

American Views on Defined Contribution Plan Saving

Summary: This 28 page Investment Company Institute survey polled respondents about their views on defined contribution retirement account saving and their confidence in 401k and other DC plan accounts. It reflects households' responses collected between November 2014 and December 2014.

Source: Ici.org , January 2015

Automatic Enrollment: The Power of the Default

Summary: Sponsors can use the inertia inherent in participant retirement savings decisions to improve retirement outcomes in defined contribution plans. This 16 page report provides updated statistics drawn from Vanguard recordkeeping data of the effects of automatic enrollment on participants' saving and investing behaviors.

Source: Vanguard.com , January 2015

401k Plan Asset Allocation, Account Balances, and Loan Activity in 2013

Summary: This comprehensive 56 page report is an update of EBRI and ICI's ongoing research into 401k plan participants' activity through year-end 2013.The report is divided into four sections: the first describes the EBRI/ICI 401k database; the second presents a snapshot of participant account balances at year-end 2013; the third looks at participants' asset allocations, including analysis of 401k participants' use of target-date, or lifecycle, funds; and the fourth focuses on participants' 401k loan activity.

Source: Ebri.org , December 2014

New Research on Women and Retirement

Summary: Retirement savings shortfalls are imminent unless women can start saving more, according to a new global study by Transamerica Center for Retirement Studies. The report on women in retirement polled 16,000 individuals in 15 countries in the Americas, Europe and Asia. The report cites ways that policymakers and employers can help women and men achieve a better retirement.

Source: Transamericacenter.org , November 2014

Using DC Plans to Improve Retirement Readiness

Summary: The 2014 DC Plan Sponsor Survey Report includes responses from 457 large and midsize U.S. companies that sponsor a 401k or 403(b) plan. It summarizes the design, investments, communication approaches and fee practices in their programs.

Source: Towerswatson.co, November 2014

The Middle-Income Boomer Retirement Gap: Savings, Education and Advice

Summary: The challenges of saving, investing and managing assets through retirement are becoming more complex. Navigating this world requires an increased level of knowledge, training and experience with financial matters and an ability to draw on trusted resources for information and guidance. This study explores how middle-income Boomers are saving for retirement, and the extent they use financial professionals for retirement advice.

Source: Centerforasecureretirement.com , November 2014

Preliminary Information on IRA Balances Accumulated as of 2011

Summary: In 2014, the U.S. federal government will forgo an estimated $17.5 billion in tax revenue from IRAs. Congress limited annual contributions to IRAs to prevent the tax-favored accumulation of unduly large balances, but concerns have been raised that tax benefits accrue primarily for higher -income individuals. This GAO report provides observations based on ongoing work on information on IRA balances in terms of reported fair market value aggregated by taxpayers.

Source: Gao.gov, October 2014

State of U.S. Employee Retirement Preparedness

Summary: Financial Finesse has released its annual research report on the state of U.S. employee retirement preparedness for 2014. This 15 page report finds employers are taking the right steps to improve retirement plan preparedness, but economic and market uncertainty may be creeping into the national psyche.

Source: Financialfinesse.com , October 2014

NEPC 2014 Defined Contribution Plan & Fee Survey: What Plan Sponsors Are Doing Now

Summary: NEPC's Defined Contribution practice group conducts an annual Defined Contribution Plan and Fee Survey to help plan sponsors understand and benchmark the fees, pricing and structure of their defined contribution plans. In its ninth year now, this 2014 Survey includes data from 113 plans, encompassing over 1.4 million plan participants. This is a five page summary.

Source: Nepc.com , October 2014

Inside the Structure of DC/401k Plan Fees

Summary: As part of an ongoing comprehensive research program, the Investment Company Institute and Deloitte Consulting have prepared this third edition of the Defined Contribution/401k Fee Study. Specifically, this report addresses and updates: The mechanics of defined contribution plan fee structures; Components of plan fees; and Factors that impact fees ("fee drivers").

Source: Ici.org , August 2014

Deloitte's Annual Defined Contribution Benchmarking Survey

Summary: Plan sponsors responding to Deloitte's Annual Defined Contribution Benchmarking Survey report an encouraging six percentage point uptick in the average employee participation rate, which rose from 71 percent in 2012 to 77 percent in 2013. But figuring out how to lure the remaining quarter of employees and increase engagement levels overall continues to be a perplexing challenge. The improving economy seems to have alleviated some employee anxiety about setting aside money for the future. Report is 85 pages.

Source: Deloitte.com , August 2014

Report on the Economic Well-Being of U.S. Households in 2013

Summary: Many households in the United States have been tested by the Great Recession. Large-scale financial strain at the household level ultimately fed into broader economic challenges for the country, and the completion of the national recovery will ultimately be, in part, a reflection of the well-being of households and consumers. To better understand the financial state of U.S. households, the Federal Reserve Board conducted a new consumer survey, the results of which are described in this report.

Source: Federalreserve.gov , August 2014

Transatlantic DC Participant Survey 2014

Summary: While the regulatory environment governing retirement plans can vary greatly among different countries, plan sponsors in Ireland, the United Kingdom and the United States often face similar challenges. Regardless of geography, almost all plan sponsors have an opportunity to do more. This survey shows that plan sponsors can improve retirement readiness by helping participants increase their savings, providing more financial education to workers and retirees, and designing retirement vehicles that are easy to understand and access.

Source: Ssga.com , August 2014

What Does Consistent Participation in 401k Plans Generate?

Summary: At year-end 2012, the average account balance among consistent participants was 67 percent higher than the average account balance among all participants in the EBRI/ICI 401k database. The consistent group's median balance was almost three times the median balance across all participants at year-end 2012.

Source: Ebri.org , August 2014

The Economics of Providing 401k Plans: Services, Fees, and Expenses, 2013

Summary: To provide and maintain 401k plans, employers are required to obtain a variety of administrative, participant-focused, regulatory, and compliance services. All of these services involve costs. This updated study looks at those costs. Key findings include plan participants investing in mutual funds tend to hold lower-cost funds, the expense ratios that 401k plan participants incur for investing in mutual funds have declined substantially since 2000, and the downward trend in the expense ratios that plan participants incur for investing in mutual funds continued in 2013.

Source: Ici.org , July 2014

Financial Knowledge and 401k Investment Performance

Summary: Financial knowledge is critical to ones retirement security, finds a new study showing that 401k plan participants who scored higher on a test of their financial knowledge earned an additional 1.3 percentage points of investment returns annually on their retirement accounts.

Source: Nber.org, July 2014

2014 Employee Benefits Research Report

Summary: SHRM's 2014 Employee Benefits research report provides comprehensive information about the types of benefits U.S. employers offer to their employees. In 2014, more than 300 benefits were explored. The report also examines trends in employee benefits offerings over the last five years.

Source: Shrm.org, June 2014

2014 Planning and Progress Study: Retirement Redefined

Summary: Significant differences exist between the attitudes and expectations of Americans who are currently working vs. those already retired, according to the most recent findings from Northwestern Mutual's 2014 Planning and Progress Study. Most notably, the research suggests that substantial changes in retirement age and lifestyle are on the horizon. This is a 16 page summary.

Source: Northwesternmutual.com , June 2014

A Study of Retirement Income Culture Among the Fortune 1000

Summary: MetLife developed the Qualified Retirement Plan Barometer study, first released in 2011, as a benchmark for assessing, at a point in time, whether, and to what extent, Fortune 1000 companies were creating a retirement income culture within their respective organizations -- one that includes emphasis on both retirement savings and retirement income. This just released 28 page document is the 2014 version.

Source: Metlife.com , June 2014

Comprehensive Report on Vanguard's 2013 Defined Contribution Plan Data

Summary: The main concerns affecting retirement savings plans remain largely the same -- improving plan participation and contribution rates and enhancing portfolio diversification -- although increasingly these changes are occurring through plan and investment menu design decisions made by sponsors, rather than by participants' own decisions. This is a 99 page comprehensive analysis of DC plans and participant behavior based on 2013 Vanguard recordkeeping data.

Source: Vanguard.com , June 2014

The Changing Face of Retirement: The Aegon Retirement Readiness Survey 2014

Summary: The Aegon Retirement Readiness survey for 2014 is clearer than ever about people's ambitions and fears with respect to retirement. Now in its third year, conducted in collaboration with Transamerica Center for Retirement Studies, Aegon's global retirement survey covers 15 countries and contains findings based on online questionnaires conducted with 16,000 people who either work in paid employment or live in retirement.

Source: Transamericacenter.org , May 2014

15th Annual Transamerica Retirement Survey

Summary: This survey is one of the largest and longest-running of its kind. It explores retirement issues among American workers and their employers. The study is a robust, nationally representative survey conducted by an independent research company. The large sample enables TCRS to delve into comparisons across many demographics and provides a basis to educate the American public on trends, issues, and opportunities related to saving and planning for retirement and achieving financial security in retirement.

Source: Transamericacenter.org, April 2014

Defined Contribution Consulting Support and Trends Survey

Summary: PIMCO's DC Practice has prepared the 2014 Defined Contribution Consulting Support and Trends Survey to help plan sponsors understand the breadth of views and specific consulting services available within the DC marketplace. This survey captures data, trends and opinions from 49 consulting firms across the U.S., which serve over 7,800 clients with aggregate DC assets in excess of $2.8 trillion.

Source: Pimco.com , April 2014

The Retirement Savings Crisis and the Limits of Soft Paternalism

Summary: The migration of American retirement savings from centralized, risk-pooling structures (Social Security and pensions) towards individual retirement plans (401k plans and other tax-favored, individually managed accounts) has had collateral consequences. This Article argues that each of these soft interventions has failed and will continue to fail in improving the allocation of retirement portfolios. In particular, soft interventions are undermined by particular aspects of the retirement-allocation decision -- including pervasive conflicts of interest in the mutual fund and retirement advisory industry, inherent difficulty, and legitimate uncertainty.

Source: Ssrn.com, April 2014

Reducing Volatility in DC Plans: Fiduciary Considerations of Incorporating Downside Risk Management

Summary: Financial markets gave investors a white-knuckled ride in 2008 and 2009, forcing plan sponsors and participants to confront the unpleasant reality of market volatility. This white paper discusses some of the primary fiduciary considerations pertinent to including plan investments that offer downside risk management in a defined contribution plan menu.

Source: F-squaredinvestments.com , April 2014

Investing for Retirement: The Defined Contribution Challenge

Summary: This white paper introduces a framework based on a common-sense definition of risk: not having enough wealth in retirement. Viewing risk this way leads to highly customizable solutions. Paper shows that dynamic asset allocation -- moving your assets -- is an essential part of achieving retirement goals. This paper is divided into two parts. Part I frames the question and explain how our framework leads to flexible, customizable solutions. Part II demonstrates the importance of dynamic allocation.

Source: Gmo.com , April 2014

2014 Retirement Confidence Survey

Summary: In the aggregate, worker savings remain low, and only a minority appear to be taking basic steps to prepare for retirement. On the other hand, there are notable differences between the behaviors -- and confidence -- of those who indicate they or their spouse have a retirement plan, and those who do not.

Source: Ebri.org , March 2014

Borrowing From the Future: 401k Plan Loans and Loan Defaults

Summary: Most active 401k plan participants have the option of borrowing from their retirement accounts, and nearly 40 percent do so over a five-year period. Paper shows that employers' loan rules have a strong endorsement effect on borrowing patterns; that is, in plans allowing multiple loans, participants are more likely to borrow and take out larger loans. Also notes that defined contribution retirement plans, while designed mainly to support old-age financial security, include important features for financing current consumption.

Source: Pensionresearchcouncil.org, February 2014

Building Retirement Security Through DC Plans

Summary: This paper discusses why employer-sponsored defined contribution plans and individual retirement accounts are such an important part of the U.S. retirement system. Discusses the numerous positive strides taken by many plan sponsors to increase participation, provide more diversified portfolios, and provide immediate eligibility to cater to a mobile workforce.

Source: Acli.com , February 2014

Americans' Views on Defined Contribution Plan Saving

Summary: The survey polled respondents about their views on DC retirement account saving and their confidence in 401k and other DC plan accounts. Survey responses indicated that households value the discipline and investment opportunity that 401k plans represent and that households were largely opposed to changing the tax preferences or investment control in those accounts.

Source: Ici.org , January 2014

2013 Generational Research

Summary: This 24 page study analyzed the strengths, weaknesses, opportunities, and threats of Millennials, Generation X, Late Baby Boomers and Early Baby Boomers based on 23,749 employees who answered a financial wellness assessment.

Source: Financialfinesse.com , January 2014

2013 Mercer Workplace Survey

Summary: Employees are putting 401k contributions on the back burner as their concerns about paying for health care continue to grow. That's according to the latest edition of the annual Mercer Workplace Survey, a nationally representative poll of retirement plan participants who also receive health benefits at work. The 2013 study also revealed a number of troubling contradictions that carry important implications for plan sponsors and administrators.

Source: Mercerhrs.com , December 2013

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