Defined Contribution

2017 DC Trends Survey

2017 DC Trends Survey
clock
1 min 32 sec

Our 10th annual Defined Contribution Trends Survey reveals that fees are playing a heightened role in driving plan sponsor decision-making. Reviewing plan fees was cited as a key area of fiduciary focus, both now and for the foreseeable future.

Related to this focus on fees are trends including an increase in recordkeeper search activity, a movement to institutional fund structures, a de-emphasis on revenue sharing, and the adoption of fee policy statements.

We have published the Defined Contribution Trends Survey each year since 2007. This year 165 U.S. DC plan sponsors responded, with more than 80% having over $100 million in assets.

Other survey findings include:

Auto features: The use of automatic contribution escalation increased markedly over the past year (63% in 2016 versus 46% in 2015). Caps on automatic contribution escalation have also markedly increased (27% in 2016 from 19% in 2015).

Fund changes: Nearly half (47%) of plan sponsors reported making a fund change due to performance-related reasons. This is the highest in the survey’s history. Large cap equity was the most commonly replaced fund.

Target date funds: Plan sponsors that took action with their target date fund in 2016 most commonly cited evaluating target date suitability (67%) as the most prevalent course of action.

Money market funds: Largely in response to money market reforms going into effect, 64% of respondents have changed to a different money market fund or eliminated their money market fund altogether.

Fiduciary Rule: Respondents believe the Department of Labor’s 2016 Definition of a Fiduciary Rule will primarily impact the plan’s printed materials, website, and other educational materials (43%) and communication regarding plan rollovers (43%). (The survey was conducted before the Trump administration took office.)

Along with the data in our quarterly Callan DC Index™ and Target Date Index™, this survey paints a detailed picture of the challenges and opportunities that are top of mind for DC plan sponsors this year.

Posted by

Share
Share on facebook
Share on twitter
Share on linkedin
Related Posts
Operations

Unlocking the Secrets of the 'Data Vault'

Bo Abesamis
Bo Abesamis describes the Callan "Data Vault," a repository where data is collected, cleansed, aggregated, and curated.
Operations

Financial Wellness: Is It the Right Prescription for Your DC Plan?

Jana Steele
Jana Steele provides a summary of her recent white paper on financial wellness options for DC plans.
ESG

Initiative Aims to Standardize ESG Reporting for Private Equity Investors

Aidan Davison
Aidan Davison explains the data convergence project and what it might mean for ESG efforts within private equity.
Operations

IRS Announces Updated Retirement Plan Limits for 2021

Jamie McAllister
The IRS announced the updated retirement plan limits for 2021.
Operations

DOL Proposes Tightened Proxy Voting Guidelines

Patrick Wisdom
The department’s new proposal dovetails with SEC guidance finalized in 2020 and would create a refined set of circumstances in which plan fiduciarie...
Operations

Fine-Tuning Implementation of the CARES Act

Jana Steele
The IRS has issued two notices and a FAQ to clarify how defined contribution (DC) plan sponsors should implement the provisions of the act, touching o...
ESG

DOL Calls for Stricter Rules Around ESG Investing in Retirement Plans

Thomas Shingler
Operations

Our DC Index Had a Noteworthy First Quarter

Patrick Wisdom
Operations

DOL Issues Common-Sense Information Letter About Private Equity in DC Plans

DC Consulting Group
Operations

Callan Survey: DC Plan Response to CARES Act Varied by Industry and Recordkeeper

Jana Steele

Callan Family Office

You are now leaving Callan LLC’s website and going to Callan Family Office’s website. Callan Family Office is not affiliated with Callan LLC.  Callan LLC has licensed the Callan® trademark to Callan Family Office for use in providing investment advisory services to ultra-high net worth clients, family foundations, and endowments. Callan Family Office and Callan LLC are independent, unaffiliated investment advisory firms separately registered with the Securities and Exchange Commission under the Investment Advisers Act of 1940.

Callan LLC is not responsible for the services and content on Callan Family Office’s website. Inclusion of this link does not constitute or imply an endorsement, sponsorship, or recommendation by Callan LLC of their website, or its contents, and Callan LLC is not responsible or liable for your use of it. When visiting their website, you are subject to Callan Family Office’s terms of use and privacy policies.