Arizona has once more ranked as the state with the highest concentration of troubled 401(k) plans, according to an analysis by Judy Diamond Associates.
Slightly more than 16 percent of the 401(k)s plans in Arizona “significantly” underperformed an average benchmark, though the Grand Canyon State did see the largest year-over-year improvement. In 2014, 17.6 percent of plans in Arizona were identified as significant underperformers.
Mississippi, meanwhile, saw the biggest increase in troubled plans, a number that bumped up to 12.9 percent of plans compared to 11.6 percent last year. That slip earned Mississippi its spot on Judy Diamond’s top 10 ranking of the states with the highest number of poorly performing 401(k) plans, after ranking 16th last year.
Judy Diamond -- a unit of Summit Professional Networks, BenefitPro’s parent company – reviewed 540,000 401(k) plans to find out which states have the highest proportion of underperforming plans.
By feeding metrics like investment return, plan design and plan management into its algorithm, Judy Diamond is able to divine an overall plan score.
Earlier this month, Judy Diamond released its ranking of states with the highest concentration of “superlative” plans. No. 1 on that list was the District of Columbia, where slightly more than 10 percent of the plans outperformed their peer group. Alaska was second, with nearly 7 percent of plans outperforming, followed by Wyoming, where 6.63 percent of plans were deemed above-par.
Here are the top 10 states with the greatest concentration of troubled plans (last year’s ranking for each is noted parenthetically):
1. Arizona (1), 16.17%
2. Nevada (2), 15.19%
3. Utah (3), 15.17%
4. Florida (4), 14.42%
5. Tennessee (7), 13.37%
6. South Carolina (10), 13.18%
7. Georgia (6), 13.12%
8. Texas (5), 13.11%
9. Mississippi (16), 12.88%
10. Alabama (13), 12.81%