Despite deep economic concerns, retirement plan participants are renewing their focus on retirement savings. Over the past year 41% of participants increased their 401(k) contribution rate (up from 31%); 40% reallocated their portfolios (up from 33%) and 38% reallocated future contributions (up from 29%). In the coming year, participants expect to contribute more to their 401(k) plans. Also, a slightly higher percentage expect to contribute the tax-deferred maximum (11%, up from 8% in 2010).
A resounding 85% of participants are confident in their 401(k) asset allocation; 83% are confident in their investment selection; and 77% are confident in their contribution amount. Thirty-six percent said that a major savings objective is to save for healthcare expenses in retirement, up from 24% in 2010. For more information, visit www.mercer.com.
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