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In addition, 403(b) sponsors have enhanced education for and communication with participants. Use of e-mail communication has increased (65% in 2011 vs. 59.5% in 2010), as has use of seminars/workshops (53% in 2011 vs. 41.8% in 2010). The survey results show nearly 40% of 403(b) plan sponsors made changes to their plan’s investment lineup in the last year, and nearly 26% plan a comprehensive re-design in the next 12 months. These trends signal opportunities for financial professionals to provide assistance to 403(b) plans, especially those who work with third-party administrators (TPAs). Nearly 35% of 403(b) sponsors report using the services of a TPA in 2011. “We’re seeing a culture of continuous improvement among 403(b) sponsors. Financial professionals can tap into that by using survey results to help clients benchmark their programs and shed light on areas that could be enhanced,” says Aaron Friedman, national non-profit practice leader, The Principal. “For instance, nearly 22% of 403(b) plan sponsors said they are still using money market funds as the default investment option whereas the strong trend among 401(k) plans is to use target-date funds as the default. That, combined with plan sponsors’ desire to continually renew investment options, could result in opportunities for financial professionals.” PSCA's 2012 403(b) Plan Survey gathered information about the 2011 plan-year experience of 584 not-for-profit organizations. Full survey results may be purchased from PSCA at www.psca.org.
In addition, 403(b) sponsors have enhanced education for and communication with participants. Use of e-mail communication has increased (65% in 2011 vs. 59.5% in 2010), as has use of seminars/workshops (53% in 2011 vs. 41.8% in 2010).
The survey results show nearly 40% of 403(b) plan sponsors made changes to their plan’s investment lineup in the last year, and nearly 26% plan a comprehensive re-design in the next 12 months.
These trends signal opportunities for financial professionals to provide assistance to 403(b) plans, especially those who work with third-party administrators (TPAs). Nearly 35% of 403(b) sponsors report using the services of a TPA in 2011.
“We’re seeing a culture of continuous improvement among 403(b) sponsors. Financial professionals can tap into that by using survey results to help clients benchmark their programs and shed light on areas that could be enhanced,” says Aaron Friedman, national non-profit practice leader, The Principal. “For instance, nearly 22% of 403(b) plan sponsors said they are still using money market funds as the default investment option whereas the strong trend among 401(k) plans is to use target-date funds as the default. That, combined with plan sponsors’ desire to continually renew investment options, could result in opportunities for financial professionals.”
Rebecca Mooreeditors@plansponsor.com