71% of workers are in DC plans. So what three things will help the most?
Today, some 71% of Americans in private sectors are enrolled in defined contribution (DC) retirement plants into which they contribute money and perhaps get an employer match.¹ That’s a big switch from what people were used to 20 years ago, when many workers received a pension through a defined benefit (DB) plan.
For DC plan sponsors, the world is changing as well. Sponsors are moving away from filling lineups with name-brand, single-manager funds and towards a more institutional approach: white label funds, open architecture, multimanager. Since many plan sponsors don’t have the time, resources, scale or expertise to do that efficiently, they look for outsourcing partners to help with implementation. Sponsors also are looking for support in selecting and monitoring vendors, such as record keeper’s support in delivering participant communications.
With all that, it may be that the HR department or whoever manages the DC plan is feeling a little overwhelmed. It could be that since the company switched from a DB to a DC plan some of that institutional knowledge about managing pension plans has gone away. Or, it could be that time and resources are simply in short supply.
Here at Russell Investments we make it our business to understand the needs of both individual investors and DC plan sponsors. Check out this article to see the three considerations that can help DC plans get it right for themselves and their participants.
¹ “Employment-Based Retirement Plan Participation: Geographic Differences and Trends, 2013,” EBRI, 2013.