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Benefits May 21, 2013
Plan Sponsors Continue to “Automate” Participant Decisions
May 21, 2013 (PLANSPONSOR.com) – Plan sponsors are increasingly adopting features to help overcome participant inertia, a survey found.
Reported by Rebecca Moore
Mesirow Financial Retirement Plan Advisory practice’s “2013 Retirement Plan Survey” found automatic solutions continue to play a key role in plan design as approximately 55% of plan sponsors surveyed offer automatic enrollment features—a 5% increase from last year. Interest in step-up deferral rate solutions continues to rise as 44% of respondents offer this as an option.
The rapid growth of target-date funds continues as more than 85% of plan sponsors report using this type of solution—up 13% from last year.
In addition, the survey found that fee disclosure is top of mind with nearly 88% of plan sponsors reviewing implicit and explicit plan fees in the past six months. However, participant interest in fee disclosure is surprisingly low with more than 83% of plan sponsors indicating employees had very few questions after receiving 404(a) participant fee disclosures.
“Plan sponsors continue to work diligently to provide the information and tools needed to help participants overcome the inertia and challenges of saving for retirement. However, in the end, each participant must take ownership of their future and the reality is that many participants need assistance through custom guidance or a more paternalistic, automated solution,” said Chris Reagan, senior managing director and practice leader at Mesirow Financial.