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Get valuable updates about Automatic 401(k)s. Subscribe to the RetirementMadeSimpler.org Subscribe to the RMS Newsletter View the Current Issue	In the News Automatic 401(k)s Aid Retirement Readiness People are more prepared for retirement than they were seven years ago, according to a recent study by the Employee Benefits Research Institute (EBRI), one of the major think tanks in the retirement space. EBRI compared its 2010 Retirement Readiness Rating with a similar rating it did in 2003. While anywhere from 43 to 47% of adults aged 36 to 62 are at risk of not having enough money for retirement, the comparable percentages in 2003 ranged from nearly 55 to 59%. The main cause of the improvement, EBRI said, was the 2006 Pension Protection Act, which requires the automatic enrollment of employees in 401(k) plans unless they opt out of the programs. Read the Article Video Report: Staving Off Retirement Shortfalls Auto-enrollment in employer plans and automatic IRAs could dramatically improve retirement savings and participation, says David John of the Heritage Foundation and the Retirement Security Project, an RMS coalition partner. Watch the Interview Retirement Made Simpler Comments on AARP Survey about Employer Views on Enrolling Employees in Auto 401(k) Plans Retirement Made Simpler (RMS) pointed to the results of coalition partner AARP’s survey of more than 800 large companies as evidence that automatic 401(k) features are gaining recognition and acceptance. The survey, which was partially funded by RMS, also underscores that additional education and information are needed to help companies overcome barriers to adopting automatic enrollment, particularly automatic enrollment of all employees. Read the Release Success Stories The Mandarin Oriental Hotel Group, operator of luxury hotels, started its 401(k) program with baby steps in 1987. After the Pension Protection Act of 2006, the company took a hard look at its plan and took steps—including automatic enrollment—to grow enrollment from 40% to 86%. Read the Success Story When Tulalip Tribes of Washington State, a federally-recognized Indian tribe located in the mid-Puget Sound area, began offering automatic enrollment in the employee 401(k) plan, participation rates nearly doubled, increasing from 36% to 71%. Read the Success Story DOL Posts Important Retirement-Related Reports The Department of Labor's Employee Benefits Security Administration has posted three reports by the 2009 Advisory Council on Employee Welfare and Pension Benefit Plans: Approaches to Retirement Security in the United States Promoting Retirement Literacy and Security by Streamlining Disclosures to Participants and Beneficiaries Stable Value Funds and Retirement Security in the Current Economic Conditions EBSA Announces Outreach and Compliance Assistance for 403(b) Plans The Department of Labor's Employee Benefits Security Administration (EBSA) announced new outreach and compliance assistance efforts for 403(b) pension plans subject to Title I of the Employee Retirement Income Security Act (ERISA). EBSA Press Release Visit EBSA’s 403(b) Web site Read the latest RMS Newsletter or view previous issues Subscribe Check Out the RMS Media Stream Automatic IRA About the Automatic IRA The Automatic IRA has been proposed as a way for the roughly half of U.S. workers that are not offered a 401(k) or any other type of employer-sponsored plan to save for retirement. Automatic IRA Resources Would Automatic IRAs Help Address Retirement Shortfalls? Congress may consider automatic IRA contributions for employees without employer-sponsored retirement plans. Read the Article Site Highlights Are the Benefits of Automatic Enrollment Worth the Cost? Read the Business Case for 401(k) Automatic Enrollment The Next Generation of Automatic 401(k) Plans Learn why automatic enrollment can increase participation rates dramatically	Studies The EBRI Retirement Readiness Rating: Retirement Income Preparation and Future Prospects Retirement plans are helping more workers pave the way for a secure retirement today than in 2003, according to a new study by the Employee Benefit Research Institute (EBRI). Improvements in retirement plan design, including automatic enrollment and diversified default investments in 401(k)s, were singled out as having led to better long-term retirement preparation prospects. Still, many workers are projected to run out of money during their retirement years. The EBRI baseline 2010 Retirement Readiness Rating finds that: Nearly one-half (47.2%) of the oldest cohort (Early Baby Boomers ages 56-62) are simulated to be “at risk” of not having sufficient retirement resources to pay for “basic” retirement expenditures and uninsured health care costs—compared to 59% in 2003. The percentage “at risk” drops for the Late Boomers (ages 46-55) to almost 44%, compared to 55% in 2003. For Generation Xers, that “at risk” figure stands at 44.5%. Read the Report Read the Release 401(k) Survey Shows Gap Between Employee Behavior and Intent, High Rate of Satisfaction with Automatic Features While experts estimate that defined-contribution (DC) investors should save 10% to 12% of income annually, the reality is that most people only manage to set aside between 6% and 7%. Using automatic features such as automatic escalation and offering a company match can help close the gap according to a new Blackrock survey. Read More Automatic Enrollment in 401(k) Plans Now Dominates at Large Employers A majority of large employers now automatically enroll workers in their 401(k) plans, the nation's predominant vehicle for employees to save for retirement, according to a new survey by Towers Watson, a global professional services company. Key Findings: 57% automatically enroll employees into their 401(k) plans. This includes 39% that automatically enroll new employees and 18% that automatically enroll all employees. More Information Read the Release Automatic 401(k) Plans: Employer Views on Enrolling New and Existing Employees In the past few years, a growing number of employers have added automatic features, especially automatic enrollment, to their 401(k) plans. This AARP national telephone survey of large employers with 401(k) plans was conducted in order to better understand large employer attitudes toward and experiences with two automatic 401(k) features: automatic enrollment and automatic escalation. Key Findings Executive Summary Full Report Retirement Made Simpler Survey of Employee Sentiments on Saving for Retirement White Papers Stay current with the latest auto 401(k) research from plan administrators, plan consultants and others Submit a White Paper Resources Automatic Enrollment 401(k) Plans for Small Businesses The Department of Labor and IRS have a new publication to help small employers understand automatic enrollment for 401(k) plans Automatic 401(k) Directory Organizations Around the Country Are Proponents of Automatic 401(k)s Saver's Credit Toolkit for HR Managers
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