A new research report from T. Rowe Price Retirement Plan Services Inc. on 401(k) participant behavior and plan design showed employers last year had increased their match formulas and overall plan participation among employees was greater than 79%.
T. Rowe Price's annual Reference Point report, based on data from 2019, said rising plan participation could be driven by employers' increased match decisions, personalized experiences, wage growth and plan design.
More than 61% of T. Rowe Price plans automatically enroll participants, the Reference Point report said. Of those, more than half enroll at a 6% default deferral. Employers, according to the report, bumped up match formulas from 3% to a 4% to 5% range "in an apparent move to incentivize more employees to save."
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