Maybe there’s no sense arguing over disclosure rules: two-thirds of Americans spend less than five minutes going over their retirement plan disclosure documents, and 20% don’t read them at all, a study released Monday by LIMRA found.
“We as an industry have concerns about helping clients,” Alison Salka, corporate vice president for LIMRA Retirement Research, told AdvisorOne on Wednesday. “Participants aren’t always as engaged as we want them to be.”
Unsurprisingly, the most often cited reason for skimming or ignoring disclosure documents is that they’re simply too long (57%). Over half of respondents said they were too technical or complicated and 43% said they were hard to understand. However, 40% said they don’t read their disclosure documents because they wouldn’t change anything as a result.
Salka noted that the main reason participants are looking at their statements is to see their balance; they’re not looking for important disclosures. “When they see fine print or language that’ complicated, they’re intimidated or just skim it for important information,” she said.
Surprisingly, adults 35 and younger are more likely to read these documents than older workers. They’re also more likely to go to their employer for information than older workers.