401(k) Plan Sponsors Worried About the Number of Participant Loans
Alight Solutions found when offered two loans, 14.4% of participants take advantage of that. When offered three loans, 11.9% do the same.
Twenty-five percent of 401(k) participants have an outstanding loan against their account, according to Alight Solutions. This is undoubtedly why 75% of employers are worried about the level of participant loans in their 401(k) plan.
When offered two loans, 14.4% take advantage of that. When offered three loans, 11.9% do the same.
Workers with loans save less (6.7%) than those without loans (8.3%). Workers with no loans are projected to save $749,000, whereas those with loans are on track to save $655,000.
Fifteen percent of workers with loans stop contributing to their retirement account.
Sixty percent of workers who have loans default on them when leaving their employer.
An infographic is available for download from here.