This was followed by fund performance (29%) and asset allocation (26%). SPARK said the survey by Brightwork Partners found participants pay the least attention to fees (20%) and how much income their DC plan account might generate for them in retirement (22%).
The level of attention paid to most of these issues increases with age and household income. For example, the report said, among participants 50 years of age and older, 55% pay a great deal of attention to their balance and 38% to their funds’ performance, while 34% are focused on how much income their account might generate in retirement and 23% pay attention to fees.
The research reveals that almost half (45%) of all DC plan participants took no action with respect to their plan during the 12 month period from the fall of 2009 to the fall of 2010. Among the 55% that took one or more actions, the most frequent activities included changing asset allocations, reallocating future contributions and increasing the deferral rate. While 12% increased their deferral rate, just 4% decreased it. Only 1% reported stopping contributions altogether.
SPARK said the level of activity increases among older participants and those with higher incomes.
Participants’ current attitudes about retirement are not upbeat. More than half of participants responding to the survey expect to work in retirement, and nearly half expect a reduction in their standard of living in retirement. Health care expenses in retirement are a huge and growing concern.According to the report, all of this has led a substantial percentage of participants to consider delaying retirement beyond their original target date – 34% of all participants, more than 50% of those in the pre-retirement (50-64) age group, and 75% of those who have already reached the normal retirement age of 65 or more.