Plan automation solutions play a key role in the plan design
process, according to a survey. The second annual Retirement Plan Survey
by Mesirow Financial Retirement Plan Advisory found 50% of plan sponsors
surveyed offer automatic enrollment features and one-third include a
step-by-step deferral rate option.
According to the survey, plan sponsors hope for continuing
strides in educating participants about the merits of their retirement plans.
The lack of participant understanding of the retirement plan benefit is a major
concern, yet satisfaction levels seem positive. Often the provider community
has offered multiple options, trying to meet the educational requirements and
needs of both the plan sponsor and participants.
When asked about overall participant satisfaction with
planning tools and options available through website materials and meetings,
14.4% of respondents said they were very satisfied; 75.6% were satisfied; 5.6%
were not satisfied; and 4.4% do not use these options.
Since the finalization of the Pension Protection Act (PPA),
target-date funds (TDFs) have grown exponentially both in usage and assets. The
trend continues in Mesirow’s latest findings, with plan sponsors using TDFs for
double-duty: as a plan’s qualified default investment alternative (QDIA) plus
as a managed account strategy. The majority (72.4%) of respondents offer TDFs;
27.6% responded they do not.