Total Retirement Savings
Highest Educational Achievement
Actions Taken in Prior 12 Months
Expected Retirement Age
Participants With >10% Deferral Rate, by Age
Participants Who Use a Financial Adviser, By Retirement Savings
Likelihood That Employees Not Covered by a DC Plan Would
Participate in One if It Were Available
Households with Total Retirement Savings <$50,000,
by Household Income
Participants Deferring >6% of Salary, Total Household Income
How Would You Prefer to Receive Information
on Financial Wellness?
Participant Trade-offs: What tips the scale in hard benefits decisions?
Present value. Historically, respondents have been somewhat neutral when asked to choose between a one-time $5,000 bonus and a one-time $5,000 contribution to their 401(k), but this year 57% preferred the bonus—up from 47% in 2016. The preference was strongest, near 70%, among younger participants—those 23 through 39 years old. Among 40- through 59-year-olds, the response was more mixed—approximately 50%—dropping to 32% for those 60 or older.
Immediate gratification. Respondents showed an equally strong preference for immediate payouts vs. deferred annuities, with 61% preferring a one-time, immediate $10,000 contribution to their 401(k) over a guaranteed $200 a month payment for life starting at age 65. While actuarial forecasts would assign much greater value to the annuity as people approach 65, all age groups—including participants over 60—preferred the immediate contribution.
Size Matters. Investment advice comes in many forms, ranging from online tools that offer personalized advice via home computer to in-person meetings with a financial adviser. When asked whether they would rather get advice online or in-person for a fictional $10,000 account, 52% of respondents selected online advice. But that number dropped to 39% for a fictional $100,000 account. Household income and retirement savings also play a role, as those with under $25,000 in household income or retirement savings were almost twice as apt to choose help from a live adviser for their fictional $10,000 or $100,000 account. —BOK