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10th National 403(b) Retirement Plan Survey: Organizations Adopting Best Practice Plan DesignsOrganizations that sponsor 403(b) plans are accelerating adoption of plan automatic features to improve plan design and participant outcomes, according to the 2018 annual 403(b) Plan Survey from the Plan Sponsor Council of America (PSCA). The report, sponsored by Principal Financial Group®, also confirms more organizations are working with advisors. This year marks the 10th year of the survey and significant trends have emerged over that period. The PSCA 403(b) Retirement Plan Survey, based on responses from nearly 600 non-profit organizations across the U.S., is the only research report of its kind that delivers actionable data that plan sponsors need to help workers reach their retirement goals. Since the non-profit sector accounts for at least one in 10 jobs in more than half of states1, the plan design changes reflected in this year's survey represent a significant boost to the nation's retirement security. "Throughout the past decade, PSCA research has revealed the significant contributions 403(b) plan sponsors have made to their workers," notes Hattie Greenan, Director of Research and Communications at PSCA. "More importantly, they continue to do so by embracing plan design features like automatic enrollment and offering services like one-on-one counseling to help workers make better decisions." The PSCA 403(b) survey findings support financial advisors' discussions with plan sponsors to recommend plan design changes that may improve their plan, and thus participant outcomes. "The PSCA survey suggests a correlation between an increased presence of advisors among 403(b) plans, and higher adoption rates of positive plan design features such as auto enrollment," said Aaron Friedman, non-profit national practice leader, Principal®. "The progress is very encouraging, but more work needs to be done." Highlights from the 10th PSCA 403(b) Survey:
PSCA's survey data points to the need for continued focus in areas of partnering with advisors, auto-enrollment, and plan governance measures to better prepare American workers for retirement. Despite a dramatic expansion in recent years, three-fourths of 403(b) plans do not currently have auto-enrollment features. Additionally, nearly 44 percent of non-profits are dealing with complex issues without the assistance of an advisor. Based on this year's findings, there are several trends to monitor:
"To keep improving participant outcomes, plan sponsors need to continue the improvements that are reported in the survey," said Friedman. "Setting up the plan for success is imperative - as it encourages participants to start saving early and to increase their deferral percentage as their salary grows over time."
About the PSCA 403(b) Plan Sponsor Survey
About Principal® Principal, Principal and symbol design and Principal Financial Group are trademarks and service marks of Principal Financial Services, Inc., a member of the Principal Financial Group. Insurance products and plan administrative services provided through Principal Life Insurance Co., a member of the Principal Financial Group®, Des Moines, IA 50392. © 2018 Principal Financial Services, Inc. 1 "How many people are employed in the U.S. nonprofit sector?" GrantSpace, 2018. View source version on businesswire.com: https://www.businesswire.com/news/home/20180926005099/en/ |