female executive in chair with pencil and notes looking in distance and thinking (Photo: Shutterstock)

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Less than 5% of Americans have made early withdrawals from theirretirement accounts during the COVID-19 crisis,according to a poll of plan sponsors by investment consultingfirm NEPC, LLC.

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Despite the low number of early withdrawals, about half (49%) ofthe plan sponsors who responded said that they doexpect CARES Act related distributions to increase at leastsomewhat in the remainder of 2020.

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And although 68% said they believe the current climateemphasizes the need for retirement plans that guarantee at least somelevel of return, 90% feel that their current menu of offerings issufficient to withstand the financial crisis resulting from thepandemic.

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The survey gave six investment and plan priority options and forthe rest of 2020 asked respondents to rank them from 1-6 (1 beingthe top priority). The top-ranked investment priority was to"consider the role of active offerings within the program" with anaverage rank of 2.76. Running a very close second was "business asusual (2.7 average ranking).

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By far, the top-ranked plan priority was "review participantcommunication and messaging" (average rank of 1.92). The next topplan priority was "consider and/or review advice offering" with a3.06 average rank).

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"Our survey reveals that with the tremendous volatility amid theCOVID-19 pandemic, plan sponsors' number one priority iscommunicating with participants to help them navigate this periodof disruption and make the best decisions for their future," RossBremen, Partner in NEPC's Defined Contribution practice said."Between the SECURE Act, the CARES Act, and the DOL's ruling onprivate equity's inclusion in plans, there is also tremendouslegislative and regulatory change to react to."

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As for the plan sponsors themselves, a large majority (77%) saidthat their organization has not made any changes to its retirementplan match policies, while 52% said that their organization has nothad any layoffs or furloughs.

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Steve Salkin is the Managing Editor ofALM's Law Journal Newsletters (LJN) division.

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