ICI Recordkeeper Data Show Retirement Plan Participants’ Commitment to Saving

Washington, DC, February 11, 2015—ICI’s latest study of retirement plan savers’ actions shows Americans’ continuing commitment to saving for retirement. The study, “Defined Contribution Plan Participants’ Activities, First Three Quarters of 2014,” includes data from January through September 2014 and is based on defined contribution (DC) plan recordkeeper data covering about 25 million participant accounts at employer-based DC plans.

DC Plan Participants Continued to Save; Withdrawal Activity Remained Low

The study demonstrates that participants continued to save in their DC retirement plans at work during the first three quarters of 2014. Findings include:

• The vast majority of DC plan participants continued contributing to their plans in the first three quarters of 2014. Only 2.7 percent of DC plan participants stopped contributing, compared with 2.5 percent in the first three quarters of 2013.
• Participants generally did not tap their accounts—DC plan withdrawals in the first three quarters of 2014 remained low and were in line with the prior year’s activity. Only 3.1 percent of DC plan participants took withdrawals in the first three quarters of 2014, similar to the pace observed over the first three quarters of 2013. Only 1.4 percent took hardship withdrawals during the first three quarters of 2014, the same share as in the first three quarters of 2013.
• Loan activity was little changed by the end of September 2014, but it continues to remain elevated compared with six years ago. The data show that at the end of September 2014, 18.0 percent of DC plan participants had loans outstanding, compared with 18.2 percent at year-end 2013, and 15.3 percent at year-end 2008.
• As stock values generally rose throughout the first nine months of the year, most DC plan participants stayed the course in their asset allocations. In the first three quarters of 2014, 8.1 percent of DC plan participants changed the asset allocation of their account balances and 5.6 percent changed the asset allocation of their contributions—slightly lower than the reallocation activity observed in the first three quarters of 2013.

DC plans are an important component of Americans’ retirement saving; assets in all DC plans represented more than one-quarter of assets in the total retirement market and accounted for one-tenth of U.S. households’ aggregate financial assets at the end of the third quarter of 2014.

ICI has been tracking participant activity through recordkeeper surveys since 2008. This update reports results from ICI’s survey of a cross section of recordkeeping firms representing a broad range of DC plans. Please visit ICI’s 401(k) resource page for more information.