Don’t touch my 401(k)! Americans like their DC plans just the way they are (with tax incentives)

Credit: Vitalii Vodolazskyi/Adobe Stock

Americans highly value their retirement plans, according to new research published by the Investment Company Institute: ICI’s report “American Views on Defined Contribution Plan Saving, 2024” finds that almost three-quarters (72%) of Americans had favorable impressions of 401(k) and similar defined contribution plan accounts – and the tax incentives. “Employer-sponsored DC plans have helped American workers achieve long-term saving goals for decades with favorable features like employer contributions, a strong lineup of investment options that are diversified and cost-effective, and tax-deferred growth. A vast majority — 85% — of DC plan participants find that the tax treatment of their plans is a big incentive to contribute,” said Sarah Holden, ICI Senior Director of Retirement and Investor Research.

“It’s important when discussing changes to our retirement system for policymakers to note that current plans are working for millions of Americans. Most Americans, whether they currently have retirement accounts or not, have confidence in DC plans as they are and do not support any changes.”