Sharp Rise in Companies Offering Roth 401ks

Roth 401ks are on the rise.

Roth 401ks are on the rise.

Looking deeper into the Society for Human Resource Management’s (SHRM’s) recently released report found—little surprise—a traditional 401(k) or similar defined contribution retirement savings plan (90 percent) was the most common retirement savings and planning benefit offered.

Additionally, the report, titled 2016 Employee Benefits Survey, noted three-quarters of organizations (74 percent) provided an employer match for this plan.

Several significant differences were found when comparing trends over the past five years, according to the organization.

Most notably, there has been a large increase in the number of organizations offering a Roth 401(k) or similar defined contribution retirement savings plan, as well as permitting conversion of funds from a traditional 401(k) account into a Roth 401(k) account.

Overall, within the last 12 months, the majority of organizations (60 percent) indicated that the amount of benefits their organization offered remained the same, one-third (33 percent) reported an increase and 7 percent reported a decrease in benefits.

About one out of five organizations improved retirement savings and planning benefits (22 percent), leave benefits (22 percent) or employee programs and services (20 percent).

Of the 7 percent of organizations that decreased overall benefits, two-thirds (66 percent) reduced health-related benefits, followed by one-quarter (24 percent) that reduced retirement savings and planning benefits. Wellness benefits came in third on the list, at 19 percent.

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