A news release about the survey conducted byDeloitte, the International Foundation of Employee Benefit Plans (IFEBP), and the International Society of Certified Employee Benefit Specialists (ISCEBS), said17% of employers polled said have seen an increased volume of hardship withdrawals, loans and other similar activities. In all, 606 plan sponsors responded to the survey.
In response to signs of a possible employee pullback, according to the announcement, a fifth of employers surveyed have implemented a re-enrollment campaign to help beef up deferral rates, and more than half (60%) are thinking about making that move.
Some 37% of employers are considering using generational segmentation when making plan design decisions, and another 37% are considering conducting a retirement readiness assessment, according to the news release.
“Because 401(k) plans represent a primary savings vehicle for employers and a key component of the Total Rewards package for employees, our survey indicates that the ongoing affects of the economic downturn have created a source of anxiety for both employers and employees alike,” explained Tim Phoenix, principal with Deloitte Consulting LLP and global leader of Total Rewards services, in the announcement. “With a greater use of 401(k) plan educational tools, the introduction of ease-of-use features and improved organizational communication, we believe employers will be better positioned to help employees meet their personal retirement goals.”
Other survey findings included:
- 63% of employers surveyed say employees are taking a “wait and see” approach to their retirement savings strategy but concern exists.
- 60% of participants held steady at their current level of contribution.
- According to the employers surveyed, there is a broad level of employee confusion typically around selecting fund options (84%) and how much money they will need for retirement (53%).
- Step-up contributions that automatically increase deferral percentages are offered by 42% of survey respondents, an increase from 35% reported last year.
- 57% of surveyed employers reported their employees are now immediately eligible for matching contributions, up from 48% last year.
Overall, the survey found, employers recognize more work has to be done getting employees ready for retirement and that they have to play their part:
- Nearly 63% of surveyed employers indicated they must take an interest in their employees' readiness for a comfortable retirement, and 14% state they feel "very" responsible for preparing employees.
- Nineteen percent of surveyed plan sponsors believe "very few" of their employees will be financially prepared for retirement.According to the employers surveyed, there is a broad level of employee confusion around how much money they will need for retirement (53%).
The survey report is available at www.deloitte.com/us/401k2009 .
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