401(k) contributions drop in troubled economy

Some 21% of participants are now contributing at a lower rate and 4% have stopped altogether, according to Putnam.
JUN 19, 2008
By  Bloomberg
While workers continue to put money into their 401(k) plans during the current downturn in the economy, they are investing at a lower rate, a survey released yesterday by Putnam Investments found. The 152 advisers that responded to the online survey, conducted in May, reported that 89% of plan participants are continuing to save and 85% of plan sponsors are continuing to provide matching contributions. But 21% of participants are now contributing at a lower rate and 4% have stopped altogether. Putnam also found that target date funds are strongly favored by plan advisers and consultants as they choose the qualified default investment alternative option. In selecting target date funds, asset allocation was the most critical factor, followed by expense ratios and glide path, the respondents indicated. Respondents indicated that open architecture within bundled plans continues to be a priority. A full 49% of the advisers and consultants indicated they serve as fiduciaries on the plans they manage. The Boston-based fund firm had $175 billion in assets under management as of May 31.

Latest News

Maryland bars advisor over charging excessive fees to clients
Maryland bars advisor over charging excessive fees to clients

Blue Anchor Capital Management and Pickett also purchased “highly aggressive and volatile” securities, according to the order.

Wave of SEC appointments signals regulatory shift with implications for financial advisors
Wave of SEC appointments signals regulatory shift with implications for financial advisors

Reshuffle provides strong indication of where the regulator's priorities now lie.

US insurers want to take a larger slice of the retirement market through the RIA channel
US insurers want to take a larger slice of the retirement market through the RIA channel

Goldman Sachs Asset Management report reveals sharpened focus on annuities.

Why DA Davidson's wealth vice chairman still follows his dad's investment advice
Why DA Davidson's wealth vice chairman still follows his dad's investment advice

Ahead of Father's Day, InvestmentNews speaks with Andrew Crowell.

401(k) participants seek advice, but few turn to financial advisors
401(k) participants seek advice, but few turn to financial advisors

Cerulli research finds nearly two-thirds of active retirement plan participants are unadvised, opening a potential engagement opportunity.

SPONSORED RILAs bring stability, growth during volatile markets

Barely a decade old, registered index-linked annuities have quickly surged in popularity, thanks to their unique blend of protection and growth potential—an appealing option for investors looking to chart a steadier course through today’s choppy market waters, says Myles Lambert, Brighthouse Financial.

SPONSORED Beyond the dashboard: Making wealth tech human

How intelliflo aims to solve advisors' top tech headaches—without sacrificing the personal touch clients crave