• Recruitment
• Workforce Trends

• Retention Strategies
• Workplace Law

• Benefits
• Best Employers Program

An Employer’s Introduction to Automatic 401(k)s

News reports and research studies continue to highlight that many American workers may not have enough money to live comfortably in retirement.

Watch video on automatic 401(k).

For most Americans, saving for retirement is chiefly done at work through their employer-sponsored retirement plan. For employers which do offer retirement plans to employees, the most common type today is the defined contribution plan, such as a 401(k). Millions of employees participate in these plans and make sensible investment and savings choices. But others save too little, invest too conservatively, or don't participate at all.

For these individuals, existing education methods in the workplace often aren't enough. Some employers are now beginning to help their employees by making their plans more "user friendly," and converting their plan to an automatic 401(k).

To help employers with this effort, AARP, the Financial Industry Regulatory Authority (FINRA), and the Retirement Security Project (RSP) teamed up to create Retirement Made Simpler, a national campaign giving employers the tools they need to adopt automatic 401(k) programs. This web site contains automatic 401(k) background information, an implementation tool kit, relevant research, and success stories from employers that have adopted such plans.

---

AARP Resources

Employer Awareness and Attitudes about Automatic 401(k) Plans
Insight into employers' perceptions about 401(k) plan automation

Enhancing 401(k) Value and Participation -
Insight into the benefits of 401(k) plan automation

Designing 401(k) Plans That Encourage Retirement Savings: Lessons From Behavioral Finance
A public policy issue brief on 401(k) plans designed to encourage retirement savings.

AARP on Financial Planning
A series to help your employees manage their finances

Additional Resources

Department of Labor Compliance Assistance
This government site assists employers and employee benefit plan officials in understanding and complying with the requirements of ERISA as it applies to the administration of employee retirement, health and other welfare benefit plans.