457 Industry Snapshot
With over $350 billion in recordkept assets, 457 plans account for the third largest pool of defined contribution (DC) assets, providing public, governmental and certain nongovernmental employees with access to benefits typically associated with 401(k) and nonqualified deferred compensation (NQDC) plans. Governmental 457(b) plans—similar to 401(k) plans in terms of eligibility guidelines and contribution limits—are the largest subset of plans and cover 6.5 million participants, while nongovernmental 457 plans must limit participation to highly compensated employees (HCEs).
Many recordkeepers service both plan types, but the governmental plan market is dominated by four providers—Empower Retirement, ICMA-RC, Nationwide and Voya Financial—which accounts for about 85% of governmental 457(b) assets. The nongovernmental 457 plan market is only slightly less concentrated, with the four largest providers—Lincoln, TIAA, T. Rowe Price and VALIC—overseeing almost 70% of total assets.
Unsurprisingly, 457s, as supplemental savings plans, are less successful at capturing participant savings than are other plans—the $47,800 in average 457 plan assets per participant is lower than the comparable figures for both 401(k) ($78,300) and 403(b) ($61,300) plans. But, as the plans’ asset growth is in line with other plan types, recordkeepers appear committed to helping 457 plan participants succeed. —BOK
Total 457 Plan Assets ($mm)
Total Assets, Plans, and Participants
|By Plan Size||Assets ($mm)*||Plans*||Participants*|
|$10mm – $50mm||$30,137||2,816||619,606|
|>$50mm – $200mm||$40,550||872||809,292|
|>$200mm – $1b||$50,477||252||1,189,184|
|*Not all providers report complete data, therefore data segmented by plan size will not equal the corresponding overall total.|