Schwab Survey Says Automatic Features, Advice Continue to Gain Ground

According to data collected from 401(k) plans serviced by Schwab Retirement Plan Services, Inc. through the first half of 2010, nearly three-quarters (74%) of employers make 401(k) advice available to plan participants, as compared to 42% in 2005. 

Additionally, 28% of employers now automatically enroll workers in these programs, compared with just 5% in 2005 (before the passage of the Pension Protection Act of 2006).  Schwab notes that among companies with more than 2,500 participants, more than half (53%) use automatic enrollment.

More than a third (37%) of employers using automatic enrollment are also using automatic savings increases, more than twice as many as did in 2006 (14%), when Schwab’s plan clients first began implementing automatic savings increases.

More than three-quarters (76%) of employers currently include target date funds in their fund line-ups, compared to 57% in 2005. 

One area where things haven’t made such healthy strides; Schwab notes that 69% of employers provide a 401(k) matching contribution, down from a peak of 76% in 2006 – but up from 67% at the end of 2009.