Auto-Pilot Doubts: Employees might not be as excited about being automatic
enrolled into their 401(k) plans as their employers are, according to a recent
study by Principal Financial. While 60 percent of workers say they are concerned
about saving enough for retirement, less than half agree that employees should
be automatically enrolled into their 401(k) plans with standard savings rates.
Employees seem to have similar apprehensions about target-date funds, despite
companies’ overwhelming acceptance of them as the default option in their 401(k)
plans. Only 24 percent of employees who say they would like to have someone
manage their funds for them would opt for a target-date fund.
That’s not to say that employees don’t want to participate in their 401(k)
plans. Of the workers who aren’t participating in their 401(k) plans, 57 percent
say it’s due to a lack of financial resources, while another 15 percent say it’s
because they are not eligible for their plans.
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