Only about 12% of the 403(b) plan sponsors that participated in a recent survey enroll eligible employees in the plans automatically.
The Profit Sharing/401k Council of America (PSCA), Chicago, has included that statistic in a report on a recent survey of 712 403(b) plan sponsors.
A 403(b) plan is a defined contribution retirement plan that serves employees of schools, charities and other nonprofit employers. Traditionally, 403(b) plan administration has been different and somewhat less formal than 401(k) plan administration; the U.S. Labor Department is in the process of implementing regulations that will make 403(b) plan administration more like 401(k) plan administration.
Although 403(b) plans still seem to be less likely to use auto enrollment programs than otherwise comparable 401(k) plans, they seem to be making more use of the kinds of professional services that 401(k) plan sponsors use.
About 77% of the plans that participated in the group’s survey now use a professional auditor, recordkeeper or aggregator to prepare their annual Form 5500 plan reports for the Labor Department and the Internal Revenue Service, up from 66% in 2009, according to Principal Financial Group Inc., Des Moines, Iowa (NYSE:PFG), the survey sponsor.
About 45% of the sponsors are using independent investment advisors to help with fiduciary responsibilities, up from 41% in 2009, Principal says.
- Allison Bell