Get access to the exclusive HR Resources you need to succeed in 2018.
Sign up for free email newsletters and get more SHRM content delivered to your inbox.
Is your employee handbook keeping up with the changing world of work? With SHRM's Employee Handbook Builder get peace of mind that your handbook is up-to-date.
Build competencies, establish credibility and advance your career—while earning PDCs—at SHRM Seminars in 14 cities across the U.S. this fall.
Gain the skills you need to rise to the next level in your career. Jon us at SHRM's Leadership Development Forum, October 2-3 in Boston.
Sponsors reluctant to automatically raise worker’s contributions might want to reconsider
Benefit managers still reluctant to automatically escalate employees’ 401(k) contributions should consider this: 55 percent of defined contribution plan participants say they would favor automatic annual increases to their contributions, according to recent survey by OneAmerica, a nationwide network of financial services providers.
“With nonstop family, health and life events, and changing financial obligations over the course of one’s life, saving for retirement can easily fall to the bottom of the priority list,” said Marsha Whitehead, vice president of marketing for retirement services for OneAmerica, in a news release. “Automatic features can help plan participants easily increase their retirement contributions and not get distracted by other financial matters.”
Automatically increasing the contribution amount each year “helps address inflation and cost of living increases,” added Whitehead. But with 29 percent of respondents unsure how they feel about auto-increase features and 19 percent saying they would opt out of the feature, “we still have work to do to educate consumers about the importance of calculating how much retirement income they need and contributing enough to their retirement accounts to meet those needs,” she noted.
Separately, a new research report by Vanguard Investments showed that retirement savings differences by racial and ethnic group are largest among voluntarily-enrolled participants. Along with auto enrollment, the researchers found that higher default deferral rates and annual auto escalation “can help narrow wealth gaps and generate sufficient retirement savings for all participants.”
You have successfully saved this page as a bookmark.
Please confirm that you want to proceed with deleting bookmark.
You have successfully removed bookmark.
Please log in as a SHRM member before saving bookmarks.
Please sign in as a SHRM member before saving bookmarks.
Please purchase a SHRM membership before saving bookmarks.
An error has occurred
Recommended for you
SHRM Member Discounts Program
SHRM’s HR Vendor Directory contains over 10,000 companies