Data and Research February 21, 2019

Participants Stay the Course With Their DC Plans

In the first three quarters of 2018, only 2.2% of participant stopped contributing to their plans, ICI data shows.

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Defined contribution (DC) plan participants remained committed to their plans in the first three quarters of 2018, data from the Investment Company Institute (ICI) shows.

A mere 2.2% of participants stopped contributing to their DC plans and only 2.9% took withdrawals, with the latter figure up only slightly from the 2.8% that took withdrawals in the first three quarters of 2017. Only 1.4% took hardship withdrawals in the first three quarters of 2018, up only slightly from the 1.3% that did so in the comparable time period in 2017.

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Participants also generally stayed the course with respect to their asset allocations, with only 8.4% changing the asset allocation of their account balances and 4.4% changing their contribution allocations. ICI says these figures were on par with the data from 2017.

In the first three quarters of 2018, 16.4% of plan participants had outstanding loans, down from 16.7% at year-end 2017.

ICI’s report, “Defined Contribution Plan Participants’ Activities, First Three Quarters of 2018,” also showed that 28% of U.S. retirement assets were in DC plans as of the end of the third quarter of 2018. ICI’s full report can be downloaded here.

Products February 21, 2019

AXA Equitable Life Launches Asset-Allocation Program for 403(b) Plans

The platform strives to offer downside market protection to plan participants.

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AXA Equitable Life has announced the availability of Semester Strategies, a new asset-allocation investment program designed for K-12 403(b) retirement plan participants. Semester Strategies is said to combine an asset-allocation plan commonly found in target-date funds (TDFs), with some downside market protection and the financial guidance of a licensed professional.

When available under their employer’s 403(b) plan, individuals will have access to model portfolios that range from conservative to more aggressive based on their years remaining to retirement, risk tolerance and stated investment return objectives.

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SWBC Investment Advisory Services created the model portfolios exclusively for AXA Equitable Life. SWBC provides ongoing fiduciary oversight for the program.

“As the leading provider of 403(b) retirement plans for K-12 educators, we continue to look for ways to innovate and provide greater value for our clients,” says Steve Scanlon, managing director and head of group retirement at AXA Equitable Life. “Current pension benefits alone are often not enough to allow individuals to live comfortably in retirement. We built Semester Strategies with educators’ unique retirement planning needs in mind by designing it to complement existing pensions with additional fiduciary oversight.”

The program is offered through an investment option in an AXA Equitable Life variable annuity contract for 403(b) retirement plans.

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