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Reference Point Annual Benchmarking Report

Reference Point delivers expertise and best practices for designing your plan and engaging participants.

It also provides trend analysis and expert commentary you can use to take advantage of emerging best practices and improve plan effectiveness. This valuable resource gives you tools for making informed decisions for your plan. 

2018 Annual Report Highlights

10-Year High

8.6%

plan-weighted average pretax deferral rate

Contributing Factors:

  • Increasing default deferral rates
  • Opt-out option for auto-increase
  • Targeted messaging for participants 

Plan design continues to drive positive outcomes for participants:

  • Participation rates were nearly 96% higher for plans with autoenrollment, and usage of auto-increase was nearly five times higher in plans that employ the opt-out option.
  • Employer match rates generally increased in 2018, and the 4% top effective match rate surpassed the 3% rate for the first time.
  • Participants who saved less in 2018 decreased their deferral rates by a greater amount than those who increased their deferral rates.
  • Loan usage reached a six-year low, while hardship withdrawals fell for the ninth year in a row.

36% Increase

in cash-out distributions

Contributing Factors:

  • Uncertainty about the markets
  • Increased distributions of small account balances

But turbulence contributed to reduced outcomes in several areas:

  • The participant-weighted participation rate dropped by nearly 2% from 2017 to 2018.
  • The percentage of participants contributing 0% increased to 36%.
  • Average account balances decreased by almost 8%, in part because of year-end market declines.
  • Late in the year, participants moved money from stocks to more conservative investments, presumably due to market activity.

About the Report

Unless otherwise noted, all data included in this report are drawn from the following sources: Data are based on the large-market, full-service universe--TRP Total--of T. Rowe Price Retirement Plan Services, Inc., retirement plans (401(k) and 457 plans), consisting of 657 plans and over 1.8 million participants.

For more information on this report or where you can get additional industry-specific data to support your plan design discussions, please contact your T. Rowe Price representative.

This material is provided for general and educational purposes only and is not intended to provide legal, tax, or investment advice. This material does not provide fiduciary recommendations concerning investments, nor is it intended to serve as the primary basis for investment decision-making.

© Copyright 2019, T. Rowe Price Investment Services, Inc., Distributor. All rights reserved.