The Plan Sponsor Council of America’s 2012 403(b) survey found that more plans offered automatic enrollment in 2011 compared to 2010 and nearly half offered target-date funds as their default investment option.
The survey, which is conducted every year, also found that catch-up contributions for participants age 50 and older are allowed in 93.3 percent of plans and 13.4 percent of eligible participants made catch-up contributions in 2011.
Nearly 85 percent of employees at respondent organizations were eligible to participate in their organization’s 403(b) plan and 77.6 percent of plans were listed as ERISA plans.
The survey also found that 1.6 percent of plan participants took a hardship withdrawal in 2011, which was the same percentage as 2010. Nearly 78 percent of plans allow participants to take hardship withdrawals.
Nearly one-quarter of organizations offer investment advice to participants and an average of 20.4 percent of participants utilized the feature when it was offered.
Plans offer an average of 27 funds for organization contributions and an average of 28 funds for participant contributions. Nearly 22 percent of respondents said their plans have 26 to 50 funds and nearly 11 percent said they have more than 50.
PSCA found that 82 percent of organizations make contributions to their 403(b) plans, with nearly 40 percent making matching contributions and nearly 24 percent making non-matching contributions only. More than 18 percent make both matching and non-matching contributions to the plan.
Regarding participant contributions, 96.4 percent of plans allow participant contributions. Pre-tax contributions are permitted in 95.5 percent of plans, while after-tax contributions are permitted in 24.5 percent of plans. Eight percent of plans require participants to contribute to the plan as a condition of employment.
An average of 75 percent of eligible employees have a balance in the plan and an average of 29.6 percent of participants with an account balance are no longer employed with the organization. An average of 64.3 percent of eligible employees made contributions to the plan in 2011.
The survey found that the availability of a Roth feature has doubled in the last four years with 21.7 percent of plans permitting Roth after-tax contributions, up from 16.9 percent in 2010, 13.9 percent in 2009 and 10.9 percent in 2007.