Employers Find Employee Retirement Issues a Priority

Employers Find Employee Retirement Issues a Priority

Employers Find Employee Retirement Issues a Priority

A recent survey conducted by Deloitte, the IFEBP (International Foundation of Employee Benefit Plans), and the ISCEBS (International Society of Certified Employee Benefit Specialists) suggests that employers and employees are focusing on retirement readiness now more than ever. 401K plan administrators and sponsors indicated the employees are in great need of guidance and advice on their overall retirement plans.

A great deal of plan sponsors indicated in survey results that they feel they have a direct responsibility which involves ensuring the employees are ready to retire with the likelihood of having a comfortable retirement package to draw from. Only 15 percent, however, indicated that they believe employees will truly be ready based on current trends.

It appears as though many plan sponsors simply aren’t using the many tools and resources that are provided by service providers in order to effectively prepare employees for retirement. It is felt that retirement readiness will be an ongoing issue that will continue to improve as the markets continue to rebound.

Studies indicate that 401k account balances have slowly rebounded since the all times lows that were experienced in 2008 and 2009, and that plan participants are cautiously making their way back to contribution levels that were more common before the market downturn.

Some of the current trends that are being seen in the 401k industry include slowly rebounding account balances, increasing contribution amounts, increasingly cautious investors, more frequent account withdrawals, and frequent account rebalancing to less aggressive investing objectives.

Over the past 10 years there has been a drastic improvement in the technology that is provided for current investors, with online account management becoming more readily available. Auto-enrollment numbers have greatly improved to almost 50 percent of companies participating. Finally, the number of investment options available to plan participants has more than doubled, with options going from under 10 to more than 20.

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