More than 43% of all organizations increased their plan
education efforts, with 59% of large organizations (1,000 participants or more)
doing so. In addition, nearly a quarter (24.3%) of large organizations added
investment advice as an option for participants, and 17.2% of all organizations
The survey found 36.1% organizations are more closely
scrutinizing the fees paid by the plan and participants. Nearly six-in-ten
respondents (59.4%) said they feel that their plan provider is providing fee
information in a way that is easy to analyze.
Among other plan-related actions taken during the
economic downturn, nearly 12% of all plans said they changed their investment
lineup as a result of economic conditions, while approximately 6% said they
delayed plan design changes and 5% indicated they hired an investment
Fourteen percent of not-for-profit 403(b) plan sponsors
indicated they took “other” plan-related actions, which included:
- Changing the waiting period for plan eligibility,
- Changing the vesting schedule,
- Changing plan providers,
- Terminating the plan,
- Changing from a non-matching contribution to a matching contribution,
- Changing from a guaranteed non-matching contribution to discretionary contribution,
- Suspending or reducing the match in 2010,
- Offering a match in lieu of a raise or offering a choice between a matching contribution and a raise,
- Consolidating plans,
- Instituting automatic enrollment, and
- Allowing hardship withdrawals.
PSCA’s “Impact of
Economic Conditions on 403(b) Plans” reflects responses from 609
not-for-profit organizations that currently sponsor a 403(b) plan.
The survey report is here.
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