When retirement plans use automatic enrollment, auto-escalation, online deferral changes or employer contributions, retirement plan participation rates increase by up to 70 percent.
That's the word from Principal Financial Group, which also found that retirement plans that offer at least two key design features have an average total participation rate of 11 percent, which is more than double the average participant savings rate.
The Principal analyzed more than 25,000 retirement plans to gauge the impact of key plan design features on participation and savings rates. The results are part of a new retirement readiness initiative and customized plan sponsor Retirement Readiness Report designed to help employers understand how well participants are saving for retirement and how plan design features can help increase savings rates.
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