Benchmarking, as a concept, depends on having two comparable sets of data that can then be used to identify differences. Although simple in some contexts, benchmarking your defined contribution (DC) plan can prove challenging—and costly—because of the difficulty in finding relevant data on plans similar to yours. And, as you know, it is critical to find a reliable and representative data source for your benchmarking efforts.
Fortunately, we can help. For almost 20 years, the annual PLANSPONSOR DC Survey has gathered plan design data from plans of all sizes—from those with less than $1 million in total plan assets to those with more than $1 billion—and representing a wide range of industries, geographies and providers. Stated differently, we believe it is one of the most flexible and trusted sources of benchmarking trend data in the industry.
While many different factors can influence plan design choices and outcomes, one of the most frequently cited is plan size. Larger plans frequently have more resources—e.g., staff and capital—to support more complex plan designs than their smaller peers. Therefore, larger plans tend to be harbingers of trends that eventually move down-market. For example, in 2008, about one-third (35.9%) of larger plans and about one-eighth (13.3%) of smaller plans offered automatic enrollment, but today both percentages have nearly doubled—to 67% and 27%, respectively.
Whether your plan is large or small or somewhere in between, the charts and tables on the following pages can help you understand how your plan design compares with thousands of others. The data highlights areas where adoption of a given plan feature is largely split between small plans (less than $10 million in plan assets) and large (more than $100 million in plan assets). We encourage you to use these survey results as a regular part of your plan evaluation process and hope you will gain a better understanding of industry trends. —Brian O’Keefe