2012 Hot Topics in Retirement - Aon

20 Aon Hewitt
Contribution Escalation Threshold Under Automatic Enrollment
50%
40%
30%
20%
10%
0%
(n=96)
Across plans that currently use automatic enrollment but have not yet also
embedded contribution escalation, the barriers reported are similar to those
that have implemented automatic enrollment. Sixty-three percent of plan
sponsors cite their concern over employee reactions and dissatisfaction as an
impediment, while 50% indicate concern over its appropriateness in the
current economic environment.
Barriers
Concern over employee reaction/dissatisfaction
Concern over appropriateness in current
economic environment
Preference for active contribution rate change
within the plan
Concern over fiduciary exposure
Default rate under automatic enrollment is
already substantial
Cost of employer match/expense
Other
4%
4% or less 5% 6% 7%-9%
Barriers to Embedding Contribution Escalation Into Automatic Enrollment
(n=64; multiple responses)
6%
45%
3%
Escalation Threshold
24%
10% >11%
Percentage of Plans
63%
50%
22%
20%
16%
14%
11%
18%