2012 Hot Topics in Retirement - Aon

18 Aon Hewitt
Changes Planned With Respect to Automatic Enrollment in 2012
Changes Planned
Apply automatic enrollment to existing
nonparticipants (i.e., backsweep either
one time or periodically)
Add contribution escalation as default
Increase initial default contribution rate
If already utilizing contribution escalation,
escalate participants to a higher target
savings rate
Apply automatic enrollment to
additional classifications of employees
(e.g., union employees or additional
business units)
(n=54; multiple responses)
Percentage of Plans
33%
33%
32%
24%
22%
Across employers that are not currently leveraging the automatic enrollment
feature, the largest barrier reported included concern about employees’
reaction to have deductions automatically taken from their paycheck (51%).
Other commonly cited di�culties were the cost of the employer match (37%)
and concern over the appropriateness of implementing automatic enrollment
in the current economic environment (35%).
Barriers to Implementing Automatic Enrollment in 2012
Barriers
Concern about employee reaction to pay
deductions
Cost of employer match
Concern over appropriateness in current
economic environment
Preference for active enrollment within
the plan
Cost/burden of administering an increased
number of small balances
Concern over fiduciary exposure
(n=258; multiple responses)
Percentage of Plans
51%
37%
35%
23%
15%
15%