Present (and positive) trends continue.
Almost all 401k and other defined contribution plan participants kept contributing to their retirement savings during 2017.
ICI’s “Defined Contribution Plan Participants’ Activities, 2017” tracked contributions, withdrawals, and other activity based on DC plan recordkeeper data covering more than 30 million participant accounts in employer-based DC plans.
The latest recordkeeper data indicate that savers “remain committed to saving for their futures by continuing to contribute to their DC plans.”
Almost all plan participants contributed to their plans, with only 2.7 percent of DC plan participants discontinuing their contributions in 2017.
Other findings include:
Withdrawal activity for DC plans remained low in 2017, similar to the activity in 2016. In 2017, 3.4 percent of DC plan participants took withdrawals, compared with 3.3 percent in 2016. Levels of hardship withdrawal activity also were low, with only 1.7 percent of DC plan participants taking hardship withdrawals during 2017, compared with 1.5 percent in 2016.
Most DC plan participants stayed the course in their asset allocations, as stock values generally rose throughout the year. In 2017, 9.3 percent of DC plan participants changed the asset allocation of their account balances, and 5.5 percent changed the asset allocation of their contributions. These levels of reallocation activity are similar to activity levels in 2016.
DC plan participants’ loan activity in 2017 was lower than a year earlier. At the end of December 2017, 16.7 percent of DC plan participants had loans outstanding, compared with 17.0 percent at the end of December 2016.
ICI has been tracking participant activity through recordkeeper surveys since 2008. This update provides results from ICI’s survey of a cross section of recordkeeping firms representing a broad range of DC plans.
With more than 20 years serving financial markets, John Sullivan is the former editor-in-chief of Investment Advisor magazine and retirement editor of ThinkAdvisor.com. Sullivan is also the former editor of Boomer Market Advisor and Bank Advisor magazines, and has a background in the insurance and investment industries in addition to his journalism roots.
