Newsdash Insight on Plan Design & Investment Strategy from PLANSPONSOR
February 4th, 2015
Editor’s Note
Today we are pleased to bring you a special edition of NewsDash highlighting our 2014 Defined Contribution Survey: Plan Benchmarking research.
PLANSPONSOR's Defined Contribution Survey - Industry Trends
This survey gathers data from thousands of plan sponsors about their plan design and administration, providing industry benchmarks. The survey is a study in contrasts and a demonstration of some surprisingly striking similarities among plans of varying sizes.Read more >
Plan Benchmarking: DC Plan Features
The survey shows the importance of breaking down industry averages. For example, only about one-quarter of plans, overall, in the DC Survey use automatic deferral escalation. However, the percentage jumps to 43% and 52% among large and mega plans, respectively.Read more >
Retirement Income Options Offered
Overall, 47% of plans in PLANSPONSOR’s 2014 DC Survey do not offer any income-oriented products or services. Among mid-sized plans, 10% offer in-plan retirement income products that guarantee monthly income, 4% offer in-plan products that guarantee a base benefit that can increase, 7.5% offer in-plan products not offering guarantees, and 4% offer an out-of-plan annuity purchase/bidding service.Read more >
Highest/Lowest Average Participation and Balance Across Industries
Labor unions have the highest average DC plan participation among industries, at 89.1%. The lowest average DC plan participation is in the restaurants/food service industry, at 51.3%. Law firms have the highest average DC plan balance ($181,176), while DC plans of religious organizations/social services entities have the lowest ($33,875).Read more >
Participant Data Breach Hits Retirement Clearinghouse
Ask the Experts
Are Emergency Savings Account Deferrals Subject to Nondiscrimination Testing?
Major Savings Barriers Include Benefits Language, Financial Stress
Considering Value
There is sometimes a tendency for plan sponsors to overlook the best value in search of the lowest price, says Gary Josephs, managing principal at Retirement Benefits Group. This is especially true when it comes to services perceived to be highly commoditized, for instance, those of the plan recordkeeper or third-party administrator (TPA). “Some sponsors are worried they will be sued for not pursuing the lowest price possible, but it’s equally important to consider the value one receives for the price paid to a recordkeeper or any other service provider touching the plan,” Josephs says.Read more >
PLANSPONSOR’s 2014 Defined Contribution Survey
The Plan Benchmarking research is taken from the annual PLANSPONSOR Defined Contribution Survey, which has been the most important industry benchmark, measuring and evaluating 401(k) and other DC providers according to feedback from their own clients, for nearly two decades. If you missed it when it came out in November, you can review it here.Read more >
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Editorial: Alison Cooke Mintzer


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