More than 600 non-profit organizations across the U.S. participated in the ninth annual Plan Sponsor Council of America (PSCA) benchmarking survey of 403(b) plans released today. Sponsored by the Principal Financial Group®, the survey results provide information plan sponsors need to help employees reach retirement goals and maximize employee satisfaction with their plan.
Non-profit organizations surveyed saw noticeable improvements in investment selections and auto-plan design features, such as increased default deferrals. The percentage of plans with a default deferral rate of more than 3 percent increased from 21.6 percent to 34 percent. In addition, organizations saw average employer contributions increase to 5 percent, up from 4.7 percent in 2015.
"Over the past several years, the PSCA survey has shown a steady increase in the use of automation and plan design enhancements. Automation is leading to greater plan enrollment, deferral rate escalation and employee contributions," said Aaron Friedman, national practice leader, Principal®. "The addition of these features tangibly helps participants boost retirement readiness in practical and customized ways."
Additional Auto-Features Results
"Retirement readiness represents an important area of focus for financial advisors and plan sponsors to help their organization and employees," said Friedman.
"The annual Plan Sponsor Council of America (PSCA) 403b survey continues to be an important source of information for plan sponsors at non-profits and educational institutions," said Jack Towarnicky, Executive Director, PSCA. "401(k) and 403(b) retirement plans play an important role in American’s retirement readiness."
PSCA conducted its ninth annual survey of 403b plan sponsors in the spring of 2017. The survey received responses from 608 non-profit organizations that currently sponsor a 403b plan for employees and range in size and industry from small community-based organizations to large hospital and university systems. For more information, visit click here.