Auto features have played a prominent role in raising participation rates and saving rates among defined contribution participants over the past 10 years, according to a survey released Tuesday by Alight Solutions.
"The average plan participation rate is 81%, the highest seen over the course of the decade," a report about the survey said. The rate was 76% in 2010. "Automatic enrollment continues to drive higher plan participation," the report said.
Last year, plans offering auto enrollment had an average participation rate of 87%, while plans lacking this plan design had an average participation rate of 62%.
Half of DC plans now have a participation rate of at least 90%, compared to 21% in 2010,the report Wadded.
Last year, 74% offered auto enrollment vs. 58% in 2009.
Alight also said the average contribution rate was 8.1% last year, the highest during the survey period. It was 7.5% in 2010.
"The popularity of automatic escalation fueled this increase," said the report, explaining that 76% of plans allowed auto escalation last year vs. 44% in 2009.
"Automatic escalation is popular when available," the report added. By the end of last year, "25% of savers were using automatic escalation, when available. This is up from 16% of savers during 2012, when Alight first began recording this metric."
The Alight report, called "2020 Universe Benchmarks," is based on responses from 116 defined contribution plans, all Alight clients, with more than 3 million participants.
