ICI data show continued commitment to retirement saving

Participants continued to save in their retirement plans at work in the first quarter of 2012, survey data from the Investment Company Institute (ICI) shows. The survey, “Defined Contribution Plan Participants’ Activities, First Quarter 2012,” is based on defined contribution (DC) plan recordkeeper data from more than 24 million DC plan participant accounts. The ICI has been tracking participant activity through recordkeeper surveys since 2008.

The study found that plan participant contribution activity in the first quarter of 2012 continued at the high rate observed in the first quarter of 2011. Only 1.0% of DC plan participants stopped contributing in the first quarter of 2012, compared with 1.0% in the same period in 2011, and 1.1% during the first quarter of 2010. DC plan withdrawals in the first quarter of 2012 remained low and were in line with the prior year’s first quarter activity, the survey found. Participants generally did not tap their accounts. Only 1.2% of DC plan participants took withdrawals in the first quarter of 2012, as was the case in the first quarter of 2011. Only 0.4% took hardship withdrawals during the first quarter of 2012, the same pace as in the first quarter of 2011.

Loan activity edged down slightly in the first quarter of 2012, although it continues to remain elevated compared with four years ago. The ICI data revealed that, at the end of March 2012, 17.9% of DC plan participants had loans outstanding, compared with 18.5% at year-end 2011. At year-end 2008, 15.3% of plan participants had loans outstanding.

The survey found that most DC plan participants stayed the course in their asset allocations. In the first quarter of 2012, 4.0% of DC plan participants changed the asset allocation of their account balances and 4.2% changed the asset allocation of their contributions—similar reallocation levels as observed in the same time frame a year earlier.

Source: ICI press release, July 25, 2012.

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For more information on this and related topics, consult the CCH Pension Plan Guide, CCH Employee Benefits Management, and Spencer’s Benefits Reports.

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