Many U.S. employers intend to restore company 401(k) matches that were suspended or reduced during the market downfall, according to a new survey by HR consultancy Hewitt Associates.
The survey also found that many companies plan to add automated tools and investment features that take the guesswork out of saving and investing. Hewitt's study of 162 mid- to large-sized U.S. companies representing 5.7 million employees found that 54 percent of employers today are less confident about their workers' ability to retire with sufficient assets than they were in 2009, when 66 percent expressed such confidence. In addition, less than one in five (18 percent) say they are very confident about their employees' ability to have enough retirement income to last throughout their retirement years.
To help employees meet their financial goals in retirement, Hewitt's survey found that 80 percent of companies that suspended or reduced their company match in 2009 are planning to restore it in 2010. In addition, the survey showed a continued emphasis among employers on automating 401(k) plans to help workers maximize the benefits of their retirement plans.
Almost half (46 percent) of employers that do not already offer automatic rebalancing a tool that helps employees regularly balance their portfolios with their target allocations are very or somewhat likely to add it to their plan in 2010. Nearly four in ten (38 percent) are very or somewhat likely to add automatic contribution escalation where employees can elect to have their contribution rates increased automatically over time.
An increasing number of employers are also offering investment services and tools to help employees make better investment and savings decisions. Half (51 percent) currently offer online investment guidance and another 42 percent are very or somewhat likely to do so in 2010. In addition, 28 percent of employers currently offer managed accounts, which allow workers to delegate the overall management of their accounts to an outside professional. One-quarter of companies (25 percent) indicate they are very or somewhat likely to offer managed accounts in the coming year.
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