Defined-contribution plan design can hurt automatic savings programs, according to T. Rowe Price.
Plans that incorporate a relatively low default rate in their automatic savings programs can result in lower savings rates overall, and many plans only offer automatic enrollment to new employees while ignoring their current employees who don't participate in the retirement plan.
A growing number of plan sponsors have implemented automatic escalation programs, but they implement them on an opt-in basis rather than an opt-out basis, which limits their impact, according to a report from T. Rowe Price, "Getting Beyond Ordinary: Advances in Automatic Savings Program Design."
Complete your profile to continue reading and get FREE access to BenefitsPRO, part of your ALM digital membership.
Your access to unlimited BenefitsPRO content isn’t changing.
Once you are an ALM digital member, you’ll receive:
- Breaking benefits news and analysis, on-site and via our newsletters and custom alerts
- Educational webcasts, white papers, and ebooks from industry thought leaders
- Critical converage of the property casualty insurance and financial advisory markets on our other ALM sites, PropertyCasualty360 and ThinkAdvisor
Already have an account? Sign In Now
© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
