The Plan Sponsor Council of America’s 64th Annual Survey of Profit Sharing and 401(k) Plans1 reports on the 2020 plan-year experience of more than 500 defined contribution plans. Leading industries represented in the survey include: Financial (22.8%), Manufacturing (11.6%), Services (8.7%), Healthcare (6.2%), Construction (4.2%), and Utilities (3.9%).
- Investment options: The average number of investment options offered increased for the first time in more than a decade, to 21 funds. Options were highest among plans with 50–199 participants and lowest among plans with 5,000+ participants.
- Target Date Funds: Eighty-three percent of plans offer target date funds, an increase of 20% in 5 years, with an average of 23.7% of plan assets invested in them. Of plans that offer target date funds, most offer actively managed (rather than passive or index-based) funds.
- Investment policy: Most plans have an Investment Policy Statement (85%). They are less common among smaller plans.
- Requests for Proposals: Twenty percent of organizations have put out a request for proposal (RFP) or information (RFI) within the last 2 years, and nearly 30% did so 2–3 years ago. Leading reasons organizations put out an RFP/RFI: to benchmark fees (64.7% of all plans) and length of time since last RFP (65.5% of all plans).
- Recordkeeping expenses: Forty-five percent of plans are charged a basis point fee (% of assets) for recordkeeping and administration; 21% of plans pay a flat rate per participant. Smaller plans are more likely to be charged a percentage of assets fee, whereas larger plans tend to pay a flat rate per participant.
For an in-depth look:
Defined Contribution Plan Benchmarking
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