Participant Deferral Rate
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The average participation rate in 401(k) plans was 85.9% at the end of 2011, according to the 55th Annual Survey of Profit Sharing and 401(k) Plans by the Plan Sponsor Council of America (PSCA). (The rate is defined as the average percentage of eligible employees who had a balance in the plan.) The rate the year before was 86.3%. An average of nearly 80% of eligible employees made contributions to the plan in 2011.
The average participant pre-tax deferral rate was 6.4%, compared to 6.2% the year before.
Fast eligibility continued
Auto enrollment remained popular
Target retirement date funds remained the most common default investment option (70% of plans).
About 55% of plans with automatic enrollment also provide for automatic increases in contribution rates over time.
Roth feature usage rose
Investment advice still common
Other survey results included:
The survey reflects 2011 experience of 10.3 million participants
The survey may be ordered from the PSCA at www.psca.org.
Plan Limitations for 2013
Defined Contribution Max. Annual Addition--$51,000
Highly Compensated Employee Threshold--$115,000
Annual Compensation Limit--$255,000
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