The recent economic turmoil may be having more of an effect on 401(k) plans and other employer-sponsored retirement plans than some surveys have indicated.
Some organizations have released survey results indicating that consumers are worried but holding tight, but researchers at the International Foundation of Employee Benefit Plans, Brookfield, Wis., say an October survey of 1,089 retirement plan sponsors indicates that participants are starting to make changes.
About 30% of the participating sponsors said defined contribution plan participants have cut overall plan contributions, and 34% said plan participants seem to be reducing exposure to stock and stock funds, according to the IFEBP researchers.
About 28% of the sponsors reported participants have been taking more loans from defined contribution plans over the past 6 months, and 29% said the economy seems to be causing more plan asset hardship withdrawals.
Only 7% of defined contribution plan sponsors have made changes in investment product offerings as a result of the economic turmoil; but 22% are considering making changes in the future, IFEBP researchers report.