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CU Snapshot

 Mar '18Feb '18
# of CUs5,5965,757
Total Assets
($ billions)
Total Savings
($ billions)
Net Cap.
Loans to Savings81.5%82.6%
Loan Delinq.0.8%0.9%

         Credit Union Indicators

Improve Retirement Program Participation

Automatic enrollment leads to better outcomes.

Automatic enrollment improves participation in sponsored retirement savings plans, according to Vanguard's "How America Saves" annual report.

"The first step in retirement savings is participation," says Jean Young, lead author of the report and a senior research analyst with the Vanguard Center for Retirement Research.

"Over the past decade, we've seen a meaningful jump in total participation rates," she adds. "Three-quarters of eligible workers now participate in their employer's plan, up from two-thirds 10 years ago, underscoring the impact of autopilot plan designs."

Improved plan design will ultimately lead to better outcomes for retirement plan participants, according to Vanguard, a leading investment company.

Plan sponsors seek to make participation the default choice, with widespread use of features such as automatic enrollment and automatic deferral increases. At year-end 2014, 36% of Vanguard plans had implemented auto enrollment—a 50% increase since 2009—and 60% of newly hired employees participating in Vanguard 401(k) plans were automatically enrolled.

Although companies traditionally used auto enrollment only with newly hired employees, sponsors of half of Vanguard plans have chosen to apply it to eligible nonparticipants. In addition, seven in 10 automatic enrollment plans have implemented automatic annual deferral-rate increases.

Vanguard also documented a marked shift toward optimally designed portfolios for participants. The continued growth of target-date funds, particularly as the default investment option, reflects the value of age- and risk-appropriate portfolio construction choices.

(Via News Now)