Posts Tagged ‘auto-escalation’

Auto Features Gain Further Traction in Retirement Plans

November 8th, 2017 by Jonathan Leidy

If you’ve been considering adding Auto Features, like auto-enrollment and auto-escalation, to your retirement plan, you’re not alone.

Per recent studies by Deloitte and others, over 65% of all new plans are being installed with auto-enrollment. Of these plans, more than 60% are also deploying auto-escalation, i.e. annual increases to the initial auto-enrollment amount. And, as noted below, participants are overwhelmingly in favor of these “do it for me” features.

It is important for plan sponsors to note that Auto Features often engender some additional administrative attention. Further, retirement plan committees are finding that, in order to have a meaningful impact, the starting percentage for auto-enrollment needs to be higher than the historical default of 3% of salary.

However, when it comes to ensuring your participants are ready to retire, Auto Features can play an extremely significant role.

Auto-Escalation GraphII