A growing priority for many companies: Getting the biggest possible bang for their employees’ retirement bucks.
The data gleaned from the Profit Sharing/401(k) Council of America’s (PSCA) 53rd annual survey of retirement plans shows that plan sponsors are more focused on their investment lineup than ever before.
- Plan investments are being monitored more frequently today, as 64.4% of sponsors review their investments quarterly
- To help participants make smart investment choices, 31.4% of employers now offer a “professionally managed alternative” — up from 26.2% in 2008, and
- 60.1% of plans offer direct investment advice to participants — up from 51.8% in 2008.
PSCA’s survey compiled this data from 931 plans representing 8.6 million participants from companies of all sizes across the U.S.
The survey also found some interesting trends among these plans features:
- Automatic enrollment — 38.4% of companies now have automatic enrollment. It’s most popular in large plans, as 53.7% of plans with 5,000 or more participants use automatic enrollment. The most common default contribution is 3% of pay.
- Auto escalation — 53.1% of companies automatically increase employees’ contribution rates over time.
- Company contributions — The average company contribution is 2.1%. Companies with profit-sharing plans contribute at a much higher rate — 8.1%.
- Advisors — 66.7% of companies have an independent investment advisor assist with fiduciary responsibility.
- Loans — Loans are now permitted in 90.2% of 401(k) plans.
- Target-date funds — 62.3% of companies now offer target-date funds.
- Vesting schedules — 39.5% of companies vest employees immediately for matching contributions.
For more in-dept info from this survey, click here.