Fewer organizations are offering DC plan hardship withdrawals, plan loans and online retirement investment advice compared with five years ago. However, one-on-one and group/classroom-style investment retirement advice remains unchanged over the same period, according to new survey results from the Society for Human Resource Management.
SHRM’s “2017 Employee Benefit: Remaining Competitive in a Challenging Talent Marketplace” report also finds that more organizations were allowing Roth conversions from a traditional 401(k) plan over the five-year period, rising from 22% in 2013 to 31% in 2017.
Used by sponsors to benchmark their overall benefits strategy, the report tracks trends and examines changes in benefit offerings to develop a snapshot of the current benefits landscape in the marketplace. Among the general findings, nearly one-third of organizations increased their overall benefits offerings in the past year, with health (22%) and wellness (24%) benefits experiencing the most growth. Retirement savings and planning benefits were in the middle of the pack, increasing 13% in the past 12 months, according to the data.
Remaining competitive in the talent marketplace was the top reason for increasing benefits, SHRM noted. The study shows that few organizations (6%) decreased benefits overall, and for those that did, the most comment reason was to remain financially stable.
Defined contribution plans continue to dominate the marketplace, with 90% of responding organizations offering a traditional 401(k) or similar plan, while 55% offer a Roth 401(k). An employer match was provided by 76% of organizations for their 401(k) plans and 40% matched Roth 401(k) contributions. Interestingly, the report shows that 24% of organizations offered a traditional defined benefit plan that was open to all employees, up from 19% in 2013.
Informal phased retirement programs are also being offered by more employers, rising from 6% in 2013 to 13% in 2017. SHRM explains that organizations are recognizing the need to facilitate the transition and transfer of knowledge for both retiring employees and their remaining co-workers.
New for 2017, the survey now includes data on organizations offering in-plan annuity options and assistance for retirees to purchase an out-of-plan annuity with in-plan assets. While the take-up rate appears somewhat low (9% for in-plan annuity option and 2% for assistance for retirees to purchase an out-of-plan annuity with in-plan assets), the report indicates that not all respondents were asked these questions.