A Hewitt news release said its survey found 54% are less confident about their workers’ ability to retire with sufficient assets than they were in 2009 (66%), while 18% say they are very confident about their employees’ ability to have enough retirement income to last throughout their retirement years.
As a result, 80% of companies that suspended or reduced their company match in 2009 are planning to restore it in 2010, the poll found.
In addition, employers continue to emphasize automatic 401(k) plan features. Some 46% of employers that do not already offer automatic rebalancing said they are very or somewhat likely to add it in 2010, and nearly four in 10 (38%) indicated they are very or somewhat likely to add automatic contribution escalation.
More Employer Efforts to Help Employees Save
Other results of Hewitt’s defined contribution plan poll, according to the firm, included:
- 51% of plans offer online investment guidance, and another 42% are very or somewhat likely to do so in 2010;
- 28% of employers offer managed accounts, and 25% indicate they are very or somewhat likely to offer managed accounts in the coming year;
- 59% of employers offer automatic enrollment, up from 51% in 2009. Among those that do not offer the feature, more than one-quarter (27%) said they are very or somewhat likely to add it in the coming year;
- 68% are very or somewhat likely to increase the amount of employee communication surrounding the investment fees and overall fund fees in their 401(k) plans in the coming year;
- six in 10 are very or somewhat likely to review their plan’s governance structure, and 51% are very or somewhat likely to benchmark plan administration and procedures to best practices in 2010;
- the number of employers offering target-date funds in 2010 (78%) remained consistent with 2009 (77%);
- 29% of companies currently offer a Roth 401(k) to their employees, consistent with 2009. Twenty-five percent said they are very or somewhat likely to add one in 2010.
- 14% of employers offer annuities outside their plan as a rollover option, up from 8% in 2009. More than one-quarter (28%) are very or somewhat likely to add them in 2010.
“In the last 18 months, employees’ 401(k) accounts took a serious financial hit due to the severe market downturn. Some of them also lost the additional retirement savings that their 401(k) employer match provided,” explained Pamela Hess, Hewitt’s director of retirement research, in the news release. ”While there has been marked growth in 401(k) balances since the market recovery began, we still see too many workers not saving and investing in a way that will help them achieve their retirement goals. Employers are trying to do their part to help—which is why they are restoring their matching contributions and offering features and tools that push workers to save more throughout their working years.”
Hewitt’s study covered 162 mid- to large-sized U.S. companies representing 5.7 million employees.