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Sponsors List 2010 Priorities

Plan sponsors’ top two priorities for this year are encouraging employees to be accountable for their own future and enhancing employees’ understanding of their future retirement benefits, according to the survey results in Hewitt Associates’ Hot Topics in Retirement 2010. A third focus is helping employees to retire with sufficient assets.

Automated features becoming standard
Nearly 60% of survey respondents offer automatic enrollment, and 12% of those who don’t are very likely to adopt it this year. Automatic contribution escalation is now included in 59% of plans. Of those who don’t offer it, 38% said they are very or somewhat likely to do so in 2010.

More than half of sponsors (54%) reported offering automatic rebalancing. All of the remaining sponsors said they are very or somewhat likely to make it available this year.

Roth 401(k) remains steady
Almost 30% of respondents permit Roth 401(k) contributions, about the same as last year. Of those not offering it, 25% said they are very or somewhat likely to add it this year.

Communications will be emphasized
Communication campaigns will be launched in 2010, respondents said, including topics such as diversification and fund usage, plan participation, contribution levels, financial education and retirement income adequacy.

Messages specifically related to market volatility will include dealing with market swings through diversification, investing for the long term, the advantages of rebalancing and the importance of saving now to reach retirement goals.

To get these messages out to employees, sponsors will use articles posted on a benefits Web site (73%), targeted mailings (70%), e-mails (62%), online modeling tools (61%) and in-person seminars (59%). Webinars, articles in internal newsletters and educational videos are other vehicles that will be used.

Online investment guidance is expected to continue to grow this year: 42% of plans expect to offer it. Investment advice will be a feature added by 34% of sponsors.

Risk management will be studied
Sponsors expect to look at their plan governance structure, benchmark plan administration, perform a compliance review, hire a third party to review the plan’s investment offerings and review fund expenses.

Click here for survey details.