PLANSPONSOR - June/July 2020 - 24

RESEARCH | 2020 RECORDKEEPING SURVEY
457 Plans
A
lthough 457 plans operate similarly to more traditional defined contribution (DC)
plans, they are also thought to be less accessible and more complex. Governmental
457(b) plans, which can resemble 401(k)s, are the largest subset of these plans and cover
around 7 million state and local government employees, while nongovernmental 457
plans cover only 250,000 participants who must be highly compensated employees
(HCEs). In both cases, the 457 plan is often supplementary to other retirement plan
offerings-i.e., pensions or other eligible DC plans.
On the surface, 457s may be less successful than other DC plans at capturing participant
savings, as the $51,520 average account balance is roughly 35% lower than the average
saved in 401(k) plans-$79,720. However, such measures fail to account for participant
savings in other accessible retirement plans and the limitations many public sector 457
plans face in offering features such as automatic enrollment and automatic escalation.
The specialized rules governing 457 plans mean providers can differentiate themselves
based on the quality of participant servicing strategies, including successful
enrollment materials, effective communication/education campaigns and financial
wellness programs capable of guiding participants to improved outcomes. Retiree
services can also be important, given some public sector employees are ineligible for
Social Security. -BOK
Growth in Total 457 Plan Assets ($mm)
$421,847
$370,544
$292,755
$321,467
$380,733
Top 10, by Total 457 Plan Assets ($mm)
1 Voya Financial
2 Nationwide
3 Empower Retirement
4 ICMA-RC
5 Fidelity Investments
6 Prudential Retirement
7 MassMutual
8 T. Rowe Price
9 AIG Retirement Services
10 TIAA
$102,457
$90,340
$76,069
$40,901
$22,882
$22,681
$13,979
$10,177
$9,391
$9,306
Top 10, by Governmental 457(b) Plans
1 Nationwide
2 Voya Financial
3 ICMA-RC
4 Equitable
5 AIG Retirement Services
6 MassMutual
7 Empower Retirement
8 OneAmerica
2016
2017
2018
2019
Total Governmental 457 Assets, Plans and Participants

Total assets
$368,138
Plan Size
<$25mm
$25mm - $100mm
>$100mm - $500mm
>$500mm

Total plans
29,060
Assets ($mm)*
$46,290
$36,136
$58,916
$226,796

Total participants
6,891,773
Plans*
27,849
831
289
91
Participants*
1,418,574
627,485
1,501,844
3,343,870
2020
9 Lincoln Financial Group
10 PCS Retirement, LLC
7,218
5,263
4,693
2,450
1,972
1,533
1,111
955
916
770
Top 10, by Nongovernmental 457 Plans
1 AIG Retirement Services
2 TIAA
2,382
1,329
3 CUNA Mutual Retirement Solutions 879
4 Principal Financial Group
5 Lincoln Financial Group
6 Fidelity Investments
7 Voya Financial
8 MassMutual
9 Empower Retirement
10 Transamerica Retirement Solutions
*Not all providers report complete data; therefore, data segmented by plan size will not equal the corresponding overall total.
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24 PLANSPONSOR.COM June - July 2020
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