Survey Finds Governmental 457 Plan Growth

Total assets of 457 plans were more than $103.3 billion for 2012, according to the “2013 NAGDCA Defined Contribution Plan Survey,” while the total for 2011 was $88 billion. The survey also found governmental 401(a) plan asset totals rose from $16 billion in 2011 to $21 billion in 2012, and governmental 401(k) plan asset totals decreased from $21 billion in 2011 to $18 billion in 2012. Three responding governmental 403(b) plans had assets totaling more than $4.6 billion.

While 6.5 million government employees were eligible to participate in defined contributions (DC) plans, only 1.7 million of them made deferrals during 2012, the same as in 2011. The average participant account balance was $41,000; the average annual deferral amount was $4,219; total employee elective contributions totaled $5 billion; and total employee mandatory contributions totaled $316 million. 

Most of the plans surveyed (60%) said they did not offer an employer matching contribution. The remaining 40% said they provided a match based on a percentage of pay per payroll period.

With regards to participation, 73% of plans said participation was elective and 92% said they did not use an automatic enrollment feature. For those that did use automatic enrollment, 55% of employees opted not to participate. Seventy-eight percent of respondents indicated their employees are also covered by a defined benefit (DB) plan.

The majority of plans (81%) disclose fee information through a website; 82% offer target-date funds; 55% offer balanced funds; 24% offer target-risk funds; and 17% offer funds-of- funds.

The survey covered a total of 136 government defined contribution plans including 401(a) plans (29), 401(k) plans (12), 403(b) plans (6) and 457 plans (89).

A summary of the survey results can be downloaded here.