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How does your company’s 401(k) plan measure up?

The IRS has conducted a survey of 1,200 different 401(k) plans from businesses of all shapes and sizes, and has created an interesting snapshot that allows you to compare your company’s plan to other plans across the country. Here’s what the survey shows:

  • 68% of plans provide employer matching contributions.
  • 41% allow employees to make election changes at any time, 22% allow them quarterly, and 13% allow them once each payroll period.
  • 5% of plans have automatic contributions unless the employee opts out. Within those plans, 43% of employees contribute at the default rate. 29% contribute more, 7% contribute less, and 21% contribute nothing.
  • 54% of plans require one year of service to contribute. Only 13% allow immediate contributions.
  • 72% use involuntary cash-outs of post-termination balances.
  • 76% allow hardship withdrawals, and 65% allow loans.
  • 22% allow Roth contributions. Only 4% allow after-tax non-Roth contributions.
  • 96% allow catch-up contributions by employees who are 50 or older.
  • Only 1% allow investments in the employer’s stock.
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