How Does Your Brain Score? Take the Staying Sharp Brain Health Assessment

New Study Shows Overwhelmingly Positive Employee Endorsement of Automatic Enrollment in 401(k) Plans

Most Feel it Makes Saving for Retirement Easier

Washington, D.C. (November 7, 2007)—A new study of employer-sponsored retirement plans shows that employees are nearly unanimous in their support of being automatically enrolled in their companies’ 401(k) plans.

The study was conducted by Harris Interactive® on behalf of Retirement Made Simpler (RMS), a coalition formed by AARP, the Financial Industry Regulatory Authority (FINRA), and the Retirement Security Project (RSP) to improve the way Americans save for retirement.

With release of the study, the coalition today launched its campaign with multiple online tools at and information to educate human resource professionals and business executives about automatic 401(k)s and how to implement them.

The Retirement Made Simpler study found that 98 percent of U.S. adults currently enrolled in an automatic 401(k) plan agree they are glad their companies offer this savings vehicle, with nearly four in five (79 percent) of them expressing strong agreement. In addition, of those who were automatically enrolled, only seven percent opted-out of the plan. The study also found that 95 percent of adults in automatic 401(k) plans agree that automatic enrollment has made saving for retirement easy and 85 percent agree that it has helped them start saving for retirement earlier than they had planned.

“Many employers have been concerned that employees would not like automatic 401(k)s—hence they reported being reluctant to adopt them,” said Mary Schapiro, FINRA’s Chief Executive Officer. “But these results overwhelmingly dispel that myth, making automatic 401(k) adoption a win-win for employers and employees.”

“AARP is committed to automating savings programs. As the responsibility of saving for retirement falls more to the individual, it’s imperative that employers and employees do all they can to enhance savings and ensure financially secure futures,” said Bill Novelli, Chief Executive Officer of AARP.

These newly released findings point toward automatic 401(k)s as a key strategy to address the serious shortfalls in retirement savings facing Americans. According to RSP, half of all households with 401(k) accounts have less than $15,000 saved in their 401(k)s. Automatic 401(k)s can help more people save significantly more over time, particularly if they increase, or escalate, the percentage of their pay they contribute to their 401(k).

In traditional 401(k)s, many eligible employees never get around to signing up for the plan because making investment choices seems daunting or simply because of procrastination or inertia. “The automatic 401(k) is a disarmingly simple concept: it enrolls employees at specified contribution levels and in a specified investment, but they can always opt-out, contribute more or less, or invest differently. This enlists inertia in the cause of saving, helping workers—especially moderate- and lower-income and minorities—save more and start earlier,” said Mark Iwry, Principal, RSP and Nonresident Senior Fellow at the Brookings Institution. While serving in the U.S. Treasury Department, overseeing the regulation of the nation’s private pension system, Iwry led the Government’s initiative to define, approve, and promote automatic 401(k)s beginning nearly a decade ago.

Search Press Center


If you are an AARP member and not with the press, call 1-888-OUR-AARP or email


For media inquiries, please contact the AARP Media Relations Office at (202) 434-2560 or


Facebook: AARP Media Relations

Twitter: @aarpmedia

Discounts & Benefits

From companies that meet the high standards of service and quality set by AARP.


Member Benefits AT&T Wireless Cell Phone

Members save 10% on the monthly service charge of qualified AT&T wireless plans.

Member Benefit AARP Regal 2

Members pay $9.50 for Regal ePremiere Tickets purchased online.

Walgreens 1 discount membership aarp

Members earn points on select Walgreens-brand health and wellness products.

Member Benefits

Join or renew today! Members receive exclusive member benefits & affect social change.