PLANSPONSOR - September - October 2023 - 26

AWARDS | 2023 BEST IN CLASS 401(k) PLANS
default " automatic escalators " without decreasing participation.
Tom Armstrong, head of the Voya Behavioral Finance
Institute for Innovation, says, " Over the past several years, automatic
enrollment and escalation features in defined contribution
plans have made it easier and simpler for individuals to
start saving early and more. These powerful tools have improved
retirement outcomes and helped close longstanding gaps in
retirement plan participation. "
While DC plan participants can have the option to specify
their rate of contribution escalation, as well as the date escalation
should begin, when they enroll in a 401(k) offering those
features, Voya found that " nearly everyone who enrolls in autoescalation
sticks with the prominently displayed default parameters
of a 1% annual escalator and a delay of one year. " But when
designing a successful auto-escalation regime into a 401(k) plan,
Voya says, plan sponsors could get participants to increase their
savings even more by adopting higher default escalators.
Restrictive Vesting Rules
Another essential design element is a vesting schedule that
is useful to both employers and employees. Chantel Sheaks,
vice president of retirement policy at the U.S. Chamber of
Commerce in Washington, explains that the general trend is
toward immediate-vesting schedules.
Many sponsors use longer-term vesting as a retention tool,
Sheaks says, but she cautions against overuse of this tactic.
Employers need to weigh the lost vested contributions against
the pay raise that an employee looking for a new job might be
able to acquire-the same calculation the employee is assuredly
making. She also notes that some employees find vesting schedules
confusing or are unaware of their employer's schedule, which
further undermines its use as a retention tool, since employees
cannot be deterred from leaving a job by an unfamiliar program.
Our 2022 DC Survey found that 34% of respondents have
graded vesting schedules of five years or more.
2023 PLANSPONSOR Best in Class 401(k) Plans
We congratulate those that earned this year's PLANSPONSOR Best in Class designation, and
we invite you to read their profiles, here. To be considered for Best in Class in 2024, please
respond to the 2023 PLANSPONSOR Defined Contribution Survey, when it is posted on plansponsor.com,
or email surveys@issmediasolutions.com to be notified when the survey goes live.
CoBank, ACB
Greenwood Village, Colorado
>$500mm - $1b | 1,000 - 4,999 participants | Fin svcs
PARTICIPATION RATE:
# OF FUNDS OFFERED:
TRUE-UP MATCH:
ELIGIBILITY:
96%
28
Yes
MAX EMPLOYER CONTRIBUTION:
MATCH RATE:
Within 3 months
6%
SYSTEMATIC WITHDRAWALS:
100% of 6%
Yes
Investing strategies
College saving
DEFAULT INVESTMENT:
RECORDKEEPER:
Yes
Yes
No
AVERAGE DEFERRAL RATE:
INVESTMENT REVIEW:
MATCH VESTING PERIOD:
DEFAULT DEFERRAL RATE:
10%
Quarterly
AUTOMATIC ESCALATION RATE:
% RECEIVING FULL MATCH:
FEE EQUALIZATION:
FINANCIAL EDUCATION TOPICS OFFERED
Saving/Budgeting
Immediate
5.6 % - 6%
1%
≥90%
No
Credit/Debt Management
Tax/Estate planning
Retiree health costs
Yes
No
No
Target-date fund
T. Rowe Price
Doyon, Limited
Fairbanks, Alaska
>$100mm - $200mm | 1,000 - 4,999 participants | Oil and gas / Energy
PARTICIPATION RATE:
# OF FUNDS OFFERED:
TRUE-UP MATCH:
ELIGIBILITY:
97%
21
Yes
MAX EMPLOYER CONTRIBUTION:
MATCH RATE:
Within 3 months
4%
SYSTEMATIC WITHDRAWALS:
51% - 99% of 6%
Yes
Investing strategies
College saving
DEFAULT INVESTMENT:
RECORDKEEPER:
Yes
Yes
Yes
AVERAGE DEFERRAL RATE:
INVESTMENT REVIEW:
MATCH VESTING PERIOD:
DEFAULT DEFERRAL RATE:
5%
Quarterly
AUTOMATIC ESCALATION RATE:
% RECEIVING FULL MATCH:
FEE EQUALIZATION:
FINANCIAL EDUCATION TOPICS OFFERED
Saving/Budgeting
Immediate
2.6 % - 3%
1%
≥90%
No
Credit/Debt Management
Tax/Estate planning
Retiree health costs
No
No
No
Target-date fund
Schwab Retirement Plan Services
26 PLANSPONSOR.COM September - October 2023
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PLANSPONSOR - September - October 2023

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