Automatic Features Push Plan Participation and Contribution Rates Soar


Per the 2020 Universe Benchmarks report, the 2010s was deemed a decade of the defined contribution investor. Attributable to employers embracing automatic features, more employees participating in employee benefit plans, the average savings rate soared, more portfolios were diversified and loan use was reduced compared to the start of the decade.

According to the report, automatic enrollment continued to drive higher plan participation over the last few years as plans with automatic enrollment had an average participation rate of 87%. Overall, the average plan participation rate at year-end 2019 was 81%, the highest over the course of the decade. Furthermore, the average contribution rate soared to 8.1%, also a decade peak, with automatic escalation helping fuel this surge. Additionally, four out of every five participants are saving enough for the full employer match.

To read more of the report, click here.

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