Vanguard study finds employers, employees improving retirement plan behaviors
The report noted that 48% of Vanguard plans at the end of 2018 featured automatic enrollment and 66% of new plan entrants were enrolled via automatic enrollment. This compares with 46% of plans that featured automatic enrollment last year, and just 20% of plans that offered it in 2008.
Including employee and employer contributions, the average 15-year total participant contribution rate in 2018 was 10.6% and the median was 9.8%, the report found. Two-thirds of auto-enrollment plans have implemented automatic deferral rate increases.
Vanguard said that at year-end 2018, 52% of all participants were invested in a single target-date fund; another 3% held one other balanced fund; and 4% used a managed account program. The use of target-date funds has resulted in fewer than one in 10 participants holding an extreme position, such as 100% in equities (6% of participants) or no equities (3% of participants).
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