PLANSPONSOR - November/December 2017 - 35

Automatic Enrollment
Default Deferral Rate
Automatic enrollment has become more of the rule than the exception,
particularly among larger plan sponsors. Automatic escalation,
whereby participants' contributions are increased incrementally
every year, is a somewhat newer concept and has been
steadily gaining traction. As a result, plans that have implemented
both auto-enrollment and auto-escalation have a 21% higher
average participation rate than plans with no " auto " features. Use
of target-date funds (TDFs) as a default investment continues to
grow and now stands at nearly two-thirds (65.9%) of plans.
Plans Using Automatic Features
n Auto-Enrollment n Auto-Escalation
For plans that include an automatic enrollment feature, the most
common default deferral rate is 3% of a participant's salary going
into the plan. However, nearly 47% of plans that use auto-enrollment
have a default rate of 4% or higher, and that has been a
growing trend. For the most part, plan sponsors have realized
that, for many employees, saving at a 3% rate is insufficient for
reaching their retirement goals, and, interestingly, plans with
higher default deferral rates tend to have higher overall employee
deferral rates.
Default Deferral Rate
43.0%
21.1%
All
<$5mm
$5mm -
$50mm
Average Plan Participation Rates
88.4%
85.6%
67.8%
73.6%
36.7%
>$50mm -
$200mm
>$200mm
10.7%
2% or less
3%
13.0% 12.2%
4%
5%
Plans With >3% Default Deferral Rate
42.4% 40.6% 41.7%
46.3%
6% or more
Auto-enrollment
and escalation
Auto-enrollment
only
Auto-escalation
only
No 'auto' plan
features
Trend in Plans Using TDF for Default Investment
75.0%
59.6%
61.6% 65.8%
69.1%
8.5%
6.0%
2013
2014
2015
2016
2017
<3%
3% - 5%
>5%
2013
2014
2015
2016
2017
Average Participant Deferral Rate by Defaulted Rate
13.7%
PLANSPONSOR.com November-December 2017 35
42.7%
35.4%
21.6%
14.8%
44.7%
32.4%
63.5%
53.8%
65.6%
67.3%

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PLANSPONSOR - November/December 2017

Table of Contents for the Digital Edition of PLANSPONSOR - November/December 2017

Seeking Value
2017 DC Survey: Plan Benchmarking
2017 Research Year in Review
Owning a Piece of the Firm
Breaking Up With a Fund
Reporting Requirements
PLANSPONSOR - November/December 2017 - Cover1
PLANSPONSOR - November/December 2017 - Cover2
PLANSPONSOR - November/December 2017 - 1
PLANSPONSOR - November/December 2017 - 2
PLANSPONSOR - November/December 2017 - 3
PLANSPONSOR - November/December 2017 - 4
PLANSPONSOR - November/December 2017 - 5
PLANSPONSOR - November/December 2017 - 6
PLANSPONSOR - November/December 2017 - 7
PLANSPONSOR - November/December 2017 - 8
PLANSPONSOR - November/December 2017 - 9
PLANSPONSOR - November/December 2017 - 10
PLANSPONSOR - November/December 2017 - 11
PLANSPONSOR - November/December 2017 - 12
PLANSPONSOR - November/December 2017 - 13
PLANSPONSOR - November/December 2017 - 14
PLANSPONSOR - November/December 2017 - 15
PLANSPONSOR - November/December 2017 - 16
PLANSPONSOR - November/December 2017 - 17
PLANSPONSOR - November/December 2017 - 18
PLANSPONSOR - November/December 2017 - 19
PLANSPONSOR - November/December 2017 - 20
PLANSPONSOR - November/December 2017 - 21
PLANSPONSOR - November/December 2017 - Seeking Value
PLANSPONSOR - November/December 2017 - 23
PLANSPONSOR - November/December 2017 - 24
PLANSPONSOR - November/December 2017 - 25
PLANSPONSOR - November/December 2017 - 26
PLANSPONSOR - November/December 2017 - 27
PLANSPONSOR - November/December 2017 - 28
PLANSPONSOR - November/December 2017 - 29
PLANSPONSOR - November/December 2017 - 2017 DC Survey: Plan Benchmarking
PLANSPONSOR - November/December 2017 - 31
PLANSPONSOR - November/December 2017 - 32
PLANSPONSOR - November/December 2017 - 33
PLANSPONSOR - November/December 2017 - 34
PLANSPONSOR - November/December 2017 - 35
PLANSPONSOR - November/December 2017 - 36
PLANSPONSOR - November/December 2017 - 37
PLANSPONSOR - November/December 2017 - 38
PLANSPONSOR - November/December 2017 - 39
PLANSPONSOR - November/December 2017 - 40
PLANSPONSOR - November/December 2017 - 41
PLANSPONSOR - November/December 2017 - 42
PLANSPONSOR - November/December 2017 - 43
PLANSPONSOR - November/December 2017 - 44
PLANSPONSOR - November/December 2017 - 45
PLANSPONSOR - November/December 2017 - 2017 Research Year in Review
PLANSPONSOR - November/December 2017 - 47
PLANSPONSOR - November/December 2017 - 48
PLANSPONSOR - November/December 2017 - 49
PLANSPONSOR - November/December 2017 - 50
PLANSPONSOR - November/December 2017 - 51
PLANSPONSOR - November/December 2017 - 52
PLANSPONSOR - November/December 2017 - 53
PLANSPONSOR - November/December 2017 - Owning a Piece of the Firm
PLANSPONSOR - November/December 2017 - 55
PLANSPONSOR - November/December 2017 - 56
PLANSPONSOR - November/December 2017 - 57
PLANSPONSOR - November/December 2017 - Breaking Up With a Fund
PLANSPONSOR - November/December 2017 - 59
PLANSPONSOR - November/December 2017 - Reporting Requirements
PLANSPONSOR - November/December 2017 - 61
PLANSPONSOR - November/December 2017 - 62
PLANSPONSOR - November/December 2017 - 63
PLANSPONSOR - November/December 2017 - 64
PLANSPONSOR - November/December 2017 - Cover3
PLANSPONSOR - November/December 2017 - Cover4
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