Loading…
Friday, November 28, 2014
Current Weather
Loading Current Weather....
Published: Tuesday, 9/4/2012

More firms offer 401(k) match to employees

Survey shows gain from pre-2008 levels

ASSOCIATED PRESS

CHICAGO — More companies are now offering a 401(k) match to their employees than were before the 2008 financial crisis, when many dropped it under duress, according to new data by Charles Schwab Corp.

An increasing number of employers also are providing financial advice to 401(k) participants, Schwab found.

The figures are based on a study of the accounts of Schwab's approximately 1.5 million 401(k) plan participants, offered through about 1,000 employers.

The study found that 73 percent of the companies provided a 401(k) matching contribution as of the end of 2011. That was up from 67 percent in 2009, 68 percent in 2010, and more than the 72 percent of 2008.

The bounce-back is a healthy sign for plan participants and employers alike, according to Steve Anderson, head of Schwab Retirement Plan Services.

"Companies recognize that it's an important benefit," he said. "As they gain greater success with their financials, they're reinstating the match."

Other findings from the study:

83 percent of employers made 401(k) advice available to plan participants, compared with 42 percent in 2005.

Forty-two percent of the firms automatically enrolled employees in their 401(k) plans, compared with 5 percent six years earlier.

Forty percent of the employers who used automatic enrollment also used automatic savings increases, up from the low of 14 percent in 2006, soon after the concept originated.

The results show that employers are responding to evidence that advice and other plan features can make a positive difference in their workers' retirement accounts, Mr. Anderson said. Recent Schwab data found that employees who use independent professional advice services inside their 401(k) plans have tended to save twice as much, were better diversified, and stuck to their long-term plans better than those who don't.

Since the middle of last year, Schwab also has seen a steady increase in hiring among the plans that it services, according to Mr. Anderson.



Guidelines: Please keep your comments smart and civil. Don't attack other readers personally, and keep your language decent. If a comment violates these standards or our privacy statement or visitor's agreement, click the "X" in the upper right corner of the comment box to report abuse. To post comments, you must be a Facebook member. To find out more, please visit the FAQ.








Poll