2018
Participant Survey

See How They Save: What motivates participant decisions?

Industry Trends

DEMOGRAPHICS


Gender

Gender Pie Chart

Age

Age Pie Chart

Total Retirement Savings

Total Retirement Savings pie chart

Employer Size

Employer Size pie chart

FACTORS INFLUENCING PARTICIPANTS’ ACTIONS


Actions taken in previous 12 months

Increased
deferral rate
35%
Changed investment
strategy
19%
Calculated
retirement income
12%
Rebalanced
account
12%
Decreased deferral
rate
7%

Primary determinant of current deferral rate

Maximum
employer match
25%
Other savings
target
19%
Maximum allowable
contribution*
15%
Default rate
12%
Advice from
spouse/friend/adviser
10%
Automatic
escalation
10%
All other
reasons
9%
*Currently $18,500 for most participants in 401(k), 403(b) and 457 plans.

How participants prefer to receive financial wellness information

Meet with
an adviser
29%
Read email
newsletter
22%
Read short
brochure
18%
Browse online
library
17%
Attend 90-minute
group seminar
14%

Most common reasons for not participating in plan

Living day
to day
26%
Paying
down debt
25%
Needing more
information
20%
Wary of investing
in stocks
15%

HYPOTHETICAL TRADE-OFF SCENARIOS

Respondents were presented with two options for each of the following scenarios and selected their preference


HYPOTHETICAL TRADE-OFF SCENARIOS chart

After five years and more than 5,000 responses, our Participant Survey proves that employees are largely consistent in how they value employer benefits. Below are some highlights.

Rising premiums. Respondents report that health insurance and retirement plans are the two most valuable employer benefits, but do these individuals have a preference for how employers allocate benefits dollars between the two? Historically, the answer has been no—respondents have been evenly split on whether they would prefer a $250 decrease in monthly insurance premiums to a $250 increase in monthly employer 401(k) contributions. But the percentage preferring insurance subsidies has been rising and now stands at 54%, compared with 48% in 2016.

Stable values. Investorsremain a cautious bunch and seem comfortable trading higher returns for lower risk and lower fees. Over the past five years, a strong majority—more than 60%—of respondents have consistently chosen low, fixed guaranteed returns (i.e., 3%) on their savings over “market-based returns that might greatly exceed the guaranteed return but could also lose money.” Respondents also dislike fees, with 51% this year willing to accept returns that are below average if the trade-off is paying lower fees.

“In”-vesting. Low unemployment rates may be contributing to a change in perspective on employer contributions and vesting schedules. In 2014, only 51% of respondents chose a 6% match with a five-year vesting schedule over a 3% match with immediate vesting, but this number has increased each of the past five years and now accounts for nearly two-thirds (64%) of employees. —Brian O’Keefe