Plan Sponsors, Participants Remain Committed to 401(k) Plans By Stephen Miller New data shows a clear correlation between employer matches for 401(k) plans and employee participation rates. The Impact of Economic Conditions on 401(k) and Profit Sharing Plans survey from the Profit Sharing/401k Council of America (PSCA), which looked at the 2008-2009 experience of 508 plan sponsors, found that: • 72.9 percent of U.S. companies that suspended their match in 2008 and 2009 experienced a decrease in plan participation vs. only 14.4 percent of those companies that maintained matching contributions. • Additionally, 17.9 percent of companies that did not change their match experienced an increase in plan participation. A significant portion of companies that experienced an increase in participation, as well as those that maintained participation levels, said that it was a result of automatic enrollment. Despite the tumultuous economic times, new hires who were enrolled automatically did not opt out at higher rates than they had previously. Read the entire article here
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