As of March 31, 2011, 12% of plans utilize both Auto Enrollment and Advice Access, 10% of plans utilize both Auto Enrollment and Auto Increase, and 7% of plans utilize Auto Enrollment, Auto Increase and Advice Access. Its analysis found plans that incorporate multiple features/services designed to encourage positive plan participant behaviors show significantly greater results.
The average participation rate for plans that use no services is 48%, compared to an average participation rate of 64% for plans that utilize any two services and 76% for plans that utilize all three.
Year-over-year, Bank of America Merrill Lynch has seen a 12% increase in the use of Auto Enrollment, with more than 260 plans live with this feature; a 23% increase in the use of Auto Increase, with more than 140 plans now live; a 26% increase in plan usage of Advice Access, with more than 420 plans now live with this service. The analysis also found a 22% increase in participants utilizing Advice Access since March 2010.
The 401(k) Contribution Activities Quarterly Scorecard also found:
- Nearly 291,000 employees took a positive savings action in their 401(k) plan accounts in Q1 2011, compared to approximately 202,000 in Q1 2010;
- Among all participants who took some type of savings action during Q1 2011, 75% took a positive action (started or increased contributions), versus 25% who took a negative action (stopped or decreased contributions) – compared to 66% and 34% during Q1 2010, respectively; and
- The percentage of plan participants who increased their contribution rate in Q1 2011 was 3 percentage points higher than those who took this action in Q1 2010, while the percentage of participants who started contributing was nearly 6 percentage points higher for the same period.