Nearly half of plan sponsor respondents say they offer no retirement income options in their DC plans — and another third say they are unsure about which options are offered.
And while the certainty improved along with plan size, the overall picture painted by PLANSPONSOR’s annual DC survey was relatively consistent. More than half — 57.3% — of plans with more than $1 billion in plan assets offered no retirement income options, for example (about 8% were not sure), while 56.6% of plans with $200 million to $1 billion in plan assets did not offer those options (14% of plan sponsors in that asset size range were unsure).
Across all plan sizes, roughly 13% offered in-plan retirement income products that offered some form of guarantee; another 8.2% offered in-plan options that did not offer a guarantee (e.g., managed payout funds or managed account distributions); and just under 5% offered an out-of-plan annuity purchase option.
However, those results were somewhat better than that found in PLANSPONSOR’s 2013 DC survey, in which 60% overall said they offered no retirement income options and 24% were unsure.
Retirement Goals
The annual survey, which this year garnered responses from just under 5,300 respondents, also asked plan sponsors whether they agreed or disagreed with the following statement: “Most of our employees will achieve their retirement goals by age 65."
Though retirement goal-setting is a highly subjective threshold, fewer than 1 in 10 agreed, while 1 in 5 agreed slightly. On the other hand, 1 in 5 disagreed, and nearly 1 in 3 (28.2%) disagreed slightly. The remaining 22.2% were undecided.
In last year’s survey, respondents were asked about their level of confidence that most of their workers would achieve their retirement income goals by age 65. At that time, just 3% were very confident in that outcome, fewer than 10% confident, and about a third were “somewhat confident.”
