About 30% of employers that participated in a recent survey now enroll employees in defined contribution plans automatically, and 56% of those employers use “target date funds” as their default investment vehicles.
Researchers in the consulting arm of Aon Corp., Chicago, are reporting that finding in a summary of results from a recent survey of about 1,100 U.S. employers.
About 93% of the employers in the sample offer defined contribution plans, and 92% of the participating employers contribute to the plans, the Aon researchers report.
Participation rates at about 40% of the employers with defined contribution plans have participation rates under 70%, the researchers report.
About 17% of all participating employers with defined contribution plans automatically enroll employees who do not make an active decision to opt out and also use target date funds as their default investment fund for employees who fail to take an active role in making investment allocation decisions, the Aon researchers report.