It seems that both employers and employees are getting the message about being smarter about retirement planning, according to an end-of-year report by Bank of America/Merrill Lynch, which has almost $100 billion in AUM and covers 2.5 million participants. Key findings from the report, which compares 2012 results to 2011, include:
• 81% of activity was positive, with loans and withdrawals decreasing.
• Plans which took advantage of face-to-face meetings — whether through seminars or one-on-one meetings — enjoyed a 67% increase in enrollment and contributions.
• Financial wellness as measured by BoA/ML’s report card increased for four major industries when personal advice was combined with auto plan features.
Going forward, the provider recommends better plan design and more face-to-face meetings and one-on-one advice, as well as combining retirement plan enrollment with health plan enrollment.
Though the auto plan seemed like a panacea when it was introduced, simple mistakes — like enrolling people at 3% — diluted the positive effects. Combining personal meetings conducted by independent and experienced advisors with good plan design seems to be taking auto plan features to the next level, according to BoA/ML’s 2012 results.
