Plan sponsors believe that targeted education works — but a new survey finds that they are not acting on those convictions.
According to the first Not-for-Profit Plan Sponsor Insights Survey by TIAA:
It’s not that they aren’t trying; 81% of plan sponsors offer one-on-one financial advice services, yet 71% say getting their employees engaged in the plan is a significant challenge.
Success ‘Tests’
So how are plan sponsors measuring success? More than half (55%) consider it a significant challenge to measure the success of their retirement plan, but asked about the most important measure of a plan’s success:
Among other success measures tracked:
Worried ‘Warts’
Those not-for-profit plan sponsors are worried about their fiduciary responsibilities. Consider that:
Sixty-five percent of plan sponsors have an Investment Policy Statement (IPS) in place to guide their investment monitoring and selection process, and 12% plan to create one in the next 12-24 months. Eighty-six percent report having a plan advisor and of those, 88% report the advisor is a fiduciary.
Plan sponsors report that over the next 12 months they will conduct a formal review of their:
The survey was conducted by KRC Research from Jan. 18 to Feb. 17, 2017, via a phone survey of 835 plan sponsors in the not-for-profit sector.
According to the first Not-for-Profit Plan Sponsor Insights Survey by TIAA:
- 68% of non-for-profit plan sponsors believe financial education designed specifically for different age groups or life stages is effective; however, only 33% offer it.
- 50% believe financial education designed specifically for women is effective, but only 14% offer it.
It’s not that they aren’t trying; 81% of plan sponsors offer one-on-one financial advice services, yet 71% say getting their employees engaged in the plan is a significant challenge.
Success ‘Tests’
So how are plan sponsors measuring success? More than half (55%) consider it a significant challenge to measure the success of their retirement plan, but asked about the most important measure of a plan’s success:
- 27% of sponsors cite participation rates, with 52% tracking these rates for their plans.
- 21% say participant income replacement rates/retirement income adequacy is the most important measure, but only 14% track these rates.
Among other success measures tracked:
- contribution rates (46%)
- average account balances (25%)
- participant investment diversification (21%)
- participant data by age groups (20%)
- participant data by gender (17%)
Worried ‘Warts’
Those not-for-profit plan sponsors are worried about their fiduciary responsibilities. Consider that:
- 38% of NFP sponsors worry about meeting responsibilities as a plan fiduciary (including 47% of K-12 sponsors).
- 31% are concerned about the impact of the DOL fiduciary rule (including 46% of higher education institutions).
- 24% worry about criticism regarding plan administrative and investment fees.
Sixty-five percent of plan sponsors have an Investment Policy Statement (IPS) in place to guide their investment monitoring and selection process, and 12% plan to create one in the next 12-24 months. Eighty-six percent report having a plan advisor and of those, 88% report the advisor is a fiduciary.
Plan sponsors report that over the next 12 months they will conduct a formal review of their:
- administrative fees (39%)
- investment menu (39%)
- investment fees (38%)
- plan design (34%)
The survey was conducted by KRC Research from Jan. 18 to Feb. 17, 2017, via a phone survey of 835 plan sponsors in the not-for-profit sector.
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