Chances are your retirement plan is already employing the use of automatic enrollment. Among non-government plans, the use of automatic enrollment remains at around seven in ten plans (71.4%). Unsurprisingly, most plans with auto enrollment offer it to new hires (94.5%). However, a solid quarter (25.4%) have auto-enrolled existing employees either as a one-time sweep or periodic sweep. Of those that do not automatically enroll employees, nearly one in ten are very likely to implement this feature in 2018. Key reasons for not implementing automatic enrollment for non-government plans include: not being perceived as necessary and not being a priority. Not being permitted to offer automatic enrollment (e.g., because of state wage garnishment laws) was the dominant reason for government plans.
Another auto-feature becoming increasingly popular is automatic contribution escalation. Four-fifths of non-government plans that have automatic enrollment also offer automatic contribution escalation (80%). After rising sharply from 2015 to 2016, the prevalence of automatic contribution escalation among non-government plans has remained at about seven in ten for the past two years. The number of plans with automatic contribution escalation that use an opt-out approach increased markedly (70.8%), compared to previous years: 2016 (59.5%), 2015 (60.7%), and 2014 (52.8%). Only 5% of non-government plans without automatic contribution escalation are very likely to adopt this feature in 2018. The top reason for not offering automatic contribution escalation among non-government plans is that it is not a high priority. Government plans cited fiduciary concerns as the top reason for not offering automatic contribution escalation (e.g., no statute supporting it).