Spectrem: Most 401(k) Plan Participants not Satisfied with Provider Web Site

The survey of about 400 plan participants showed that three-quarters were somewhat satisfied or are very dissatisfied with their provider’s Web site. Of those mentioning a specific reason for their lukewarm comfort level, a preference for using hard-copy materials (20%) or for dealing with people (8%) were cited most often. Older participants were more likely than younger participants to prefer a mailed copy.

Some of the reasons for preferring paper over electronic materials may have to do with safety. Nearly nine in 10 participants say they are either “very” (44%) or “somewhat” (41%) concerned over the electronic transmittal of their personal information.

Participants with larger account balances tend to visit their plan’s Web site more frequently. While three-fourths (76%) of those with balances greater than $50,000 visit the Web site at least once a month, fewer than one-half (46%) of those with smaller balances were likely to visit even once.

Those with balances under $50,000 (19%) were more likely than those with greater balances (7%) to investigate plan features. Participants with balances of $50,000 and above were more likely to use it for transferring funds among investment options. <$50,000, 6%; <$50,000, 11%) or using the financial/retirement planning tools (<$50,000, 3%; <$50,000, 11%) provided.

When e-mail alerts are relevant to retirement funds, such as informing when a fund moves up or down, 63% of participants believe this would be at least somewhat important. Nearly one in five (17%) felt these reminders would be very important.

While this pattern was similar across demographic segments, those under the age of thirty-five (31%) were the most likely to feel that these alerts would be very important.

Those with account balance greater than $50,000 and those over age 35 are most likely to include their retirement plan Web site in their “favorites folder.”

The most common reason for plan sponsors to visit their own Web sites is to get information for participant questions (15%), followed by checking participant balances/activity (13%), and to make administrative changes (12%).

The most common capability of plan sponsor Web sites is for downloading forms (72%), followed by fund performance reports (71%), confirmation of transactions (63%), and online enrollment (59%).

More information is at info@spectrem.com or by phone at 312.382.8284.