Target date funds increasingly featured in 403(b) plans, survey says

Funds are also being used as default investment options

Jul 7, 2009 @ 3:21 pm

By Lisa Shidler

Non-profit organizations are embracing target date funds and a majority of 403(b) plan sponsors have begun offering these funds in their plans, a study released today showed.

The study, from the Chicago-based Profit Sharing/401k Council of America, found that 51% of 403(b) plan sponsors surveyed offered target date funds and nearly a quarter of organizations that did not offer them plan to do so within the year.

The study, sponsored by The Principal Group of Des Moines, Iowa, also found the number of 403(b) plans using target date funds as a default investment option had more than doubled since 2007.

A 403(b) plan is a retirement plan that K-12 schools, universities, religious organizations and other non-profit entities employ.

“This survey shows that 403(b) plans are evolving to more closely resemble 401(k) plans,” David Wray, president of the PSCA, said in a statement.

The survey, conducted in May, surveyed 144 plan sponsors.

This date will be helpful as 403(b) plans face new regulations imposed by the Internal Revenue Service, Aaron Friedman, national practice leader for non-profit at The Principal, said in a statement.

These new regulations require plan sponsors to have detailed plan documents in place by Dec. 31.

0
Comments

What do you think?

View comments

Recommended for you

Featured video

INTV

Why advisers are pessimistic about the economy

Deputy editor Bob Hordt and senior research analyst Matt Sirinides discuss a recent InvestmentNews survey of advisers, most of whom see a recession ahead before the next presidential election.

Recommended Video

Keys to a successful deal

Latest news & opinion

Blackrock exposed data on 12,000 financial advisers

The data appeared in three spreadsheets, linked on one of the New York-based company's web pages dedicated to its iShares exchange-traded funds

Advisers throw cold water on FIRE movement

Millennials love it, advisers don't: Turns out, extreme early retirement is a suitable goal for almost nobody.

10 universities with the most billionaire alumni

These 10 American schools have the greatest number of alumni who are billionaires.

Top-performing ETFs of 2018

The markets took a beating last year, but these exchange-traded funds bucked the trend

Widow awarded $4.2 million by Finra panel for theft by ex-Royal Alliance broker

The former broker, Gary Basralian, earlier pleaded guilty to theft and is facing up to 20 years in prison.

X

Hi! Glad you're here and we hope you like all the great work we do here at InvestmentNews. But what we do is expensive and is funded in part by our sponsors. So won't you show our sponsors a little love by whitelisting investmentnews.com? It'll help us continue to serve you.

Yes, show me how to whitelist investmentnews.com

Ad blocker detected. Please whitelist us or give premium a try.

X

Subscribe and Save 60%

Premium Access
Print + Digital

Learn more
Subscribe to Print