Conducted by American Investment Planners LLC, “The Retirement Plan Survey” found that an estimated 23,000 401(k) plans were terminated in 2012. An estimated 19,000 plans were terminated in 2011.
Almost one-quarter (22%) of the terminated plans belonged to health care providers. “Many doctors have terminated their plans because they have merged their practices with larger health care providers,” says Brett Goldstein, director of retirement planning for American Investment Planners.
Survey findings also reveal that fewer companies surveyed are offering employer matching contributions within their 401(k) plan. In fact, the number offering such a match decreased 4.7% between 2011 and 2012.
“Many employees don’t contribute enough to their 401(k) to get the full employer match,” says Goldstein. “As a result, their employers are cutting back on their employer matching contribution, or eliminating it entirely, to save money.”
As for consultants and those workers running a home-based business, Goldstein recommends such individuals start their own retirement plans, consulting with a financial adviser on the specifics. Otherwise, he adds, workers need to save more money in retirement vehicles such as individual retirement accounts (IRAs), Roth IRAs or annuities.
The results of the survey were generated by evaluating Form 5500 filings released by the Department of Labor.
American Investment Planners is based in Jericho, New York.