401(k)'s a boon to low-income workers

Automatic escalation will increase 401(k) accumulations by up to 28% in the lowest income group, says a study.
SEP 12, 2007
A study released today by the nonpartisan Employee Benefit Research Institute shows that the Pension Protection Act of 2006 will result in a significant increase in 401(k) accumulations — particularly for low-income workers. The study predicts that the automatic escalation will increase 401(k) accumulations by 11% to 28% for participants in the lowest income group and 5% to 12% for participants in the highest income group. The legislation allows employers to automatically enroll workers in the company’s 401(k) plan and to automatically increase a worker’s 401(k) contribution to coincide with a raise or a work anniversary — though the employee can decline both enrollment and the increase. These findings “suggest that the introduction of automatic escalation will result in a significant increase of 401(k) accumulations — especially for low-income workers — compared with estimates previously determined for automatic enrollment,” according to the analysis.

Latest News

Mercer Advisors, Osaic deepen AI bets with Arch and Nitrogen deals
Mercer Advisors, Osaic deepen AI bets with Arch and Nitrogen deals

Arch claims 40% operating cost savings for Mercer as Nitrogen unlocks its agentic AI and tech suite to 10,000 Osaic advisors

LPL advisor, South Carolina state senator, elected to U.S. Congress
LPL advisor, South Carolina state senator, elected to U.S. Congress

A happy coincidence: one of LPL Financial’s corporate campuses happens to be based in Rep.-elect Wes Climer’s new district.

Advisor moves: JPMorgan lands $940M Merrill veteran in Los Angeles
Advisor moves: JPMorgan lands $940M Merrill veteran in Los Angeles

Wells Fargo and UBS also add advisors from Morgan Stanley, Edward Jones, Merrill and Fidelity in a fresh round of wirehouse recruiting

Wall Street products, Main Street regulators
Wall Street products, Main Street regulators

How we got here – and what to do about it

Most Americans are OK with AI managing their money - but not how you think
Most Americans are OK with AI managing their money - but not how you think

AI trust gap: Americans want protection, not autonomy, in their finances

SPONSORED Built on insurance experience to deliver on long-term promises

Knighthead Life entered the market with a competitive MYGA. A strong launch earned advisor confidence and paved the way for FIAs.

SPONSORED In the Age of AI, Trust Becomes the Advisor's Greatest Asset

As AI makes financial information more accessible than ever, Lana Hock explains why human judgment, trust, and empathy remain the qualities clients value most in a financial advisor