Data & Research March 16, 2011

Study Finds Proof of Stagnation in Auto-Enrollment Adoption

Fifty-five percent of plan sponsors say they have no plans to adopt automatic enrollment in 2011, according to a recently released survey.
Reported by

The Grant Thornton LLP, Drinker Biddle & Reath LLP, and Plan Sponsor Advisors LLC, survey noted that from 2009 to 2010, use of auto-enrollment increased from 39% to 45%. This year, 33% of respondents reported that they will be offering automatic enrollment with an employer match and an additional 9% said they are providing automatic enrollment without an employer match.  Thirteen percent of plan sponsors said they are also including an automatic increase in default deferral rates.

In addition, the study found 58% of plan sponsors are not considering a Roth feature in their plan. Twenty-eight percent of plan sponsors who indicated that Roth features are being added to their plans in 2010–11 indicated that regulatory updates involving “in-plan Roth rollovers” contributed to the decision.

Meanwhile, 9% of plan sponsors surveyed are considering the addition of a retirement income solution to provide an ongoing payment stream option for employees. Of the 9%, the response was split almost equally between an in-plan (52%) and out-of-plan (48%) solution.

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