PLANSPONSOR - September 2017 - 10

Industry Analysis
W
ith 79% of retirement plan
sponsors now allowing participants
to take loans against
their accounts, that provision has often
been examined as a cause of savings leakage.
Often this leakage results because
sponsors require employees to repay a loan
in full upon termination of employment.
If the employee cannot, the funds become
taxable and penalties are charged.
But, increasingly, plan sponsors are
permitting repayment post-separation.
Overall, about 60% of providers that
responded to the 2017 PLANSPONSOR
Recordkeeping Survey offer loan repayment
options, the most popular being
checking account deductions.
With one barrier to borrowing
removed, plans allowing post-separation
repayment have a higher average and
median percentage of participants with
loans. Still, the average and median size
of the loans is nearly the same whether
the option is offered or not, suggesting
that the reasons participants took the
loans were consistent across both pools.
As long as loans get repaid, allowing for
it post-separation might be positive for
preventing leakage. -Judy Faust Hartnett
l Unsure
Source: PLANSPONSOR 2016 Defined Contribution (DC) Survey
Loan Repayment Options
98%
50%
Automatic
checking
account
deductions
Coupon book
payments
(via traditional
mail)
Source: PLANSPONSOR 2017 Recordkeeping Survey
Allows Post-Separation Loan Repayment
l Yes-has been/will soon be implemented
l No-but considering adding it in the future
l No-we have not discussed adding it
l Unsure
Source: PLANSPONSOR 2016 DC Survey
Participants With an Open/Outstanding Loan
ALLOWS POST-SEPARATION REPAYMENT
AVERAGE
MEDIAN
Participants with an open/outstanding loan
Current borrowers' average loan balance
Plan Participation rate
Plan Deferral rate
Average participant account balance
Source: PLANSPONSOR 2016 DC Survey
17.3%
$9,588
69.3%
5.4%
$66,078
15.2%
$8,500
81.3%
5.7%
$45,900
OTHER PLANS
AVERAGE
MEDIAN
13.7% 11.0%
$9,495
20%
Other methods
(certified
check, money
order, etc.)
11%
Any
non-payroll
form of
payment
Spotlighting industry data from PLANSPONSOR's proprietary research
Loan Repayment Capabilities
Plan Includes Participant Loan Provision
l Yes
l No
79%
19%
1%
25%
5%
56%
14%
$8,200
78.5% 86.0%
6.6%
6.0%
$87,038 $65,000
10 PLANSPONSOR.com September 2017

http://www.PLANSPONSOR.com

PLANSPONSOR - September 2017

Table of Contents for the Digital Edition of PLANSPONSOR - September 2017

Harvesting the Right Facts and Figures
2017 target-Date Fund Buyer's Guide
Allocating Benefit Dollars
Keeping Money in the Plan
Strategic Timing
Rothification of DC Plans
PLANSPONSOR - September 2017 - Cover1
PLANSPONSOR - September 2017 - Cover2
PLANSPONSOR - September 2017 - 1
PLANSPONSOR - September 2017 - 2
PLANSPONSOR - September 2017 - 3
PLANSPONSOR - September 2017 - 4
PLANSPONSOR - September 2017 - 5
PLANSPONSOR - September 2017 - 6
PLANSPONSOR - September 2017 - 7
PLANSPONSOR - September 2017 - 8
PLANSPONSOR - September 2017 - 9
PLANSPONSOR - September 2017 - 10
PLANSPONSOR - September 2017 - 11
PLANSPONSOR - September 2017 - 12
PLANSPONSOR - September 2017 - 13
PLANSPONSOR - September 2017 - 14
PLANSPONSOR - September 2017 - 15
PLANSPONSOR - September 2017 - 16
PLANSPONSOR - September 2017 - 17
PLANSPONSOR - September 2017 - 18
PLANSPONSOR - September 2017 - 19
PLANSPONSOR - September 2017 - 20
PLANSPONSOR - September 2017 - 21
PLANSPONSOR - September 2017 - 22
PLANSPONSOR - September 2017 - 23
PLANSPONSOR - September 2017 - 24
PLANSPONSOR - September 2017 - 25
PLANSPONSOR - September 2017 - Harvesting the Right Facts and Figures
PLANSPONSOR - September 2017 - 27
PLANSPONSOR - September 2017 - 28
PLANSPONSOR - September 2017 - 29
PLANSPONSOR - September 2017 - 30
PLANSPONSOR - September 2017 - 31
PLANSPONSOR - September 2017 - 2017 target-Date Fund Buyer's Guide
PLANSPONSOR - September 2017 - 33
PLANSPONSOR - September 2017 - 34
PLANSPONSOR - September 2017 - 35
PLANSPONSOR - September 2017 - 36
PLANSPONSOR - September 2017 - 37
PLANSPONSOR - September 2017 - 38
PLANSPONSOR - September 2017 - 39
PLANSPONSOR - September 2017 - 40
PLANSPONSOR - September 2017 - 41
PLANSPONSOR - September 2017 - 42
PLANSPONSOR - September 2017 - 43
PLANSPONSOR - September 2017 - Allocating Benefit Dollars
PLANSPONSOR - September 2017 - 45
PLANSPONSOR - September 2017 - 46
PLANSPONSOR - September 2017 - Keeping Money in the Plan
PLANSPONSOR - September 2017 - 48
PLANSPONSOR - September 2017 - 49
PLANSPONSOR - September 2017 - Strategic Timing
PLANSPONSOR - September 2017 - 51
PLANSPONSOR - September 2017 - Rothification of DC Plans
PLANSPONSOR - September 2017 - 53
PLANSPONSOR - September 2017 - 54
PLANSPONSOR - September 2017 - 55
PLANSPONSOR - September 2017 - 56
PLANSPONSOR - September 2017 - Cover3
PLANSPONSOR - September 2017 - Cover4
https://www.plansponsordigital.com/plansponsor/march_april_2024
https://www.plansponsordigital.com/plansponsor/january_february_2024
https://www.plansponsordigital.com/plansponsor/november_december_2023
https://www.plansponsordigital.com/plansponsor/september_october_2023
https://www.plansponsordigital.com/plansponsor/july_august_2023
https://www.plansponsordigital.com/plansponsor/may_june_2023
https://www.plansponsordigital.com/plansponsor/march_april_2023
https://www.plansponsordigital.com/plansponsor/december_2022_february_2023
https://www.plansponsordigital.com/plansponsor/october_november_2022
https://www.plansponsordigital.com/plansponsor/august_september_2022
https://www.plansponsordigital.com/plansponsor/june_july_2022
https://www.plansponsordigital.com/plansponsor/excellenceawards_2022
https://www.plansponsordigital.com/plansponsor/april_may_2022
https://www.plansponsordigital.com/plansponsor/february_march_2022
https://www.plansponsordigital.com/plansponsor/december_2021_january_2022
https://www.plansponsordigital.com/plansponsor/october_november_2021
https://www.plansponsordigital.com/plansponsor/august_september_2021
https://www.plansponsordigital.com/plansponsor/june_july_2021
https://www.plansponsordigital.com/plansponsor/april-may_2021
https://www.plansponsordigital.com/plansponsor/february-march_2021
https://www.plansponsordigital.com/plansponsor/december-january_2021
https://www.plansponsordigital.com/plansponsor/october-november_2020
https://www.plansponsordigital.com/plansponsor/august-september_2020
https://www.plansponsordigital.com/plansponsor/june-july_2020
https://www.plansponsordigital.com/plansponsor/april-may_2020
https://www.plansponsordigital.com/plansponsor/february-march_2020
https://www.plansponsordigital.com/plansponsor/december-january_2020
https://www.plansponsordigital.com/plansponsor/october-november_2019
https://www.plansponsordigital.com/plansponsor/august-september_2019
https://www.plansponsordigital.com/plansponsor/june-july_2019
https://www.plansponsordigital.com/plansponsor/april-may_2019
https://www.plansponsordigital.com/plansponsor/february-march_2019
https://www.plansponsordigital.com/plansponsor/december_2018-january_2019
https://www.plansponsordigital.com/plansponsor/october-november_2018
https://www.plansponsordigital.com/plansponsor/august-september_2018
https://www.plansponsordigital.com/plansponsor/june-july_2018
https://www.plansponsordigital.com/plansponsor/april-may_2018
https://www.plansponsordigital.com/plansponsor/february-march_2018
https://www.plansponsordigital.com/plansponsor/december_2017-january_2018
https://www.plansponsordigital.com/plansponsor/november_december_2017
https://www.plansponsordigital.com/plansponsor/october_2017
https://www.plansponsordigital.com/plansponsor/september_2017
https://www.nxtbookmedia.com