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1、Give the people what they want Participant preferences come into focus for plan sponsors2023 NATIXIS DEFINED CONTRIBUTION PLAN PARTICIPANT SURVEY1 I 2023 NATIXIS DEFINED CONTRIBUTION PLAN PARTICIPANT SURVEYSaving for retirement is a daunting task:Not knowing when theyre going to retire,what the expe
2、nses will look like,or how long the money will have to last makes it hard for most people to know just how much they need to save.When faced with these key questions,the common-sense answer is “Start early in life and save as much as you can.”Its sage advice thats clear and simple,but acting on it g
3、ot a lot harder in the past two years.Skyrocketing inflation has driven energy,food,and housing costs to record highs,and many workers are struggling to find room in shrinking household budgets to fund retirement savings.In fact,results from the 2023 Natixis Survey of Defined Contribution Plan Parti
4、cipants show inflation is the number-one barrier to retirement saving in the United States.But todays higher prices only serve to magnify many long-standing chal-lenges.Results of the survey conducted in February and March of 2023 show American workers are feeling the weight of responsibility for re
5、tirement funding and they have strong preferences for the kind of help they want.2 I 2023 NATIXIS DEFINED CONTRIBUTION PLAN PARTICIPANT SURVEYFindings show a clear picture of how retirement saving needs to evolve and offer insight on three critical questions facing plan participants and sponsors ali
6、ke:Where are participants now?Asked about their outlook on retirement,half(47%)say:“Im good,Im on track to save enough.”But a deeper dive shows that this may be false confidence and that the math behind their plans for retirement doesnt add up.What do participants want?In looking to save more(or eve
7、n to start participating in a plan),workers identify access to student loan matches,emergency savings,and sustainable investments as key incentives.Provisions of the recently enacted SECURE 2.0 and updated guidance on ERISA plans from the US Department of Labor are all designed to help,but participa
8、nts think even more can be done.Of particular interest are the 73%who say they would begin to participate or increase contributions if their plan offered investments in companies with good environmental,social,and gover-nance practices.Why do participants need help?Beyond inflation,a wide range of f
9、actors are limiting participation and savings.Ranging from personal debt to high healthcare costs to low or no employer match,the pressures are limiting participation,but also causing many to tap even the little savings they have.Retirement is changing.Generation by generation,plan participants expr
10、ess unique needs and pref-erences when it comes to saving.Baby Boomers were among the first to have access to defined contribution plans and have come full cycle from saving to spending.In fact,10,000 Boomers reach retirement age every day.Millennials now account for about 40%of the US workforce,and
11、 they are looking for more out of their employer-sponsored plan.When it comes down to it,putting this new gener-ation of workers on track will take united efforts from policy makers,employers,and individuals.With so many new features and benefits available for plan design,sponsors are in a position
12、to have a positive impact on retirement security that will last for decades to come.Where are participants now?On the surface,plan participants are remarkably confident about prospects for a secure retirement.When asked for their financial outlook on retirement,close to half(47%)of participants say“
13、Im good,Im on track to save enough.”Another 27%said“Itll be tight,but I think I can do it.”Just one in five(18%)think its going to be a struggle.Only 5%reflect on their financial situation and think its going to be impossible to retire.But that overwhelmingly positive sentiment has to be taken with
14、a grain of salt.When asked the same ques-tions,those who have access to a plan but dont par-ticipate express only slightly less confidence:34%say theyre on track to save enough,29%think it will be tight,one-quarter think its going to be a struggle.Only 7%think its impossible.Whether they participate
15、 in a plan or not,many may be expressing a false sense of confidence about re-tirement security.In fact,sentiment data shows bad assumptions and faulty math may be propping up this overly optimistic outlook across the survey sample.Bad assumptions and faulty math on retirement savings Overall,those
16、surveyed say they plan to retire at age 63.They plan to live in retirement for 23 years and think theyll need about$1 million to make it happen.The overall average may seem realistic,but optimism may be clouding the judgment of younger workers when it comes down to what it will actually take to reti
17、re.The 362 Millennials surveyed say they plan to retire at age 60 almost 8 years before they can collect Social Security benefits.They anticipate a 25-year retirement,which may be more on the mark.But Millennials think it will take an average of only$891,000 to fund that 25-year retirement.Millennia
18、ls may be off to a good start with median retirement savings of$50,000($32,000 in plans,$50,000 in all accounts),but they have a long way to go if they want to hit even the modest goal of roughly$900,000.Getting there will mean saving an average of$35,000 per year.Even then,its likely they will come
19、 up short,as their$891,000 goal works out to about$36,000 in annual income over 25 years.Older workers may be more realistic about what it will take,but their average savings levels suggest getting to the goal will be a long shot.Generation X workers(ages4 I 2023 NATIXIS DEFINED CONTRIBUTION PLAN PA
20、RTICIPANT SURVEYAnticipated retirement ageActual age of retirementAnticipated years in retirementAmount needed for retirementSaved in plan(median)Saved in all accounts(median)Age started saving in company planContribution rate60-25$891,000$32,000$50,0002716.3%Millennials underestimatewhat it will ta
21、ke Anticipated retirement ageActual age of retirementAnticipated years in retirementAmount needed for retirementSaved in plan(median)Saved in all accounts(median)Age started saving in company planContribution rate6550(9 resp)22$1.26m$74,000$81,000339.7%Generation X is coming up short,but theres time
22、 to catch up Anticipated retirement ageActual age of retirementAnticipated years in retirementAmount needed for retirementSaved in plan(median)Saved in all accounts(median)Age started saving in company planContribution rate7061(100 resp)22$1.12m$120,000$170,000389.5%Boomers have not saved enoughand
23、plan to work longer 4357)have a funding target of$1.2 million which is the highest among all three generations.But median savings of$81,000 is not likely to get them over the line not unless they generate average savings of$59,000 every year until age 65,when they plan to retire.The situation is eve
24、n more dire for Baby Boomers.At the tail end of their careers,Boomers,who think theyll need$1.1 million,are looking at median savings balances of just$170,000.Fortunately,they anticipate working until age 70.Even with that extra time,theyll need to sock away an average of$186,000 annually to hit the
25、 mark.Contribution rates a bright spot On the upside,participants report an average contribution rate of 13%.But that number is skewed by the large num-ber of high-saving Millennials who report an average an-nual contribution rate of 16.3%.Generation X participants report an average contribution rat
26、e of only 9.7%,while Boomers report an even lower rate of 9.5%,a significant gap that is reflected in low retirement plan balances.Millennials may have the smallest account balance now,but they have a second critical factor working for them:They started participating in their company plan at age 27,
27、almost a decade sooner than Boomers(38).Even though they are saving at a higher rate now,they may have to adjust their estimates on retirement age and how much they need overall.In general,they are off to a relatively good start toward retirement security.WHERE ARE PARTICIPANTS NOW?Multiple streams
28、of retirement income Regardless of how much they save,American workers recognize that retirement income will need to come from multiple sources.For many,the mix goes well be-yond the traditional three-legged stool built on personal savings,Social Security,and an employer pension.The instinct to dive
29、rsify their income will serve them well as fewer workers have access to a pension.Defined contribution plan savings lay the foundation for retirement income,but most recognize it wont be enough.Overall,71%believe retirement plan savings will be a primary income source,but Millennials(85%)were more l
30、ikely to see plan savings in this way.Fewer from Gen-eration X(71%)see these savings in the same leading role.Only 46%of Boomers think plan savings will be a pri-mary source of income almost half that of Millennials.Beyond what they save in plans,virtually all participants have identified other sour
31、ces of income.Seven in ten said they would count on personal savings,but the numbers reveal a significant gap.Only 58%of Millennials say they will rely on personal savings,while 94%of Generation X and 72%of Boomers agree.Along with personal savings,39%of respondents will also count on their spouse o
32、r partners retirement savings and another 36%will rely on their IRA balances,including half(49%)of Boomers.Social Security(63%)factors heavily in the income plan of almost all those surveyed,but there is significant age difference.Nine out of ten Boomers say Social Security will factor into their in
33、come plans,as do two-thirds(66%)of Generation X.Less than half of Millennials(46%)agree.Another notable gap can be seen between those over age 50(86%)and those under 50(51%)who anticipate Social Security will be part of their income plans.Surprisingly,a significant number of individuals(38%)will als
34、o count on pension income.This includes 45%of Boomers,34%of Gen X,and 35%of Millennials.Most notable is the 47%of individuals over age 50 who say they will have pension income.Its important to understand that,while a large part of the population no longer has access to pensions,certain professions d
35、o.Teachers,state and local government employees,police,firefighters,healthcare professionals,transportation workers,the military,and construction workers are professions that still may offer traditional defined benefit pensions.Many individuals see additional retirement income sources to be tapped i
36、ncluding home equity(28%),inheritance(22%)and even rental income(14%).Most notable are those who say theyll count on help from their children(12%).About one in five Millennials expect that help compared to only 2%of Boomers.In short,19%of the generation that started out in their parents basement thi
37、nk theyll end up in their kids garage.WHERE ARE PARTICIPANTS NOW?SOURCES OF RETIREMENT INCOME70%PERSONAL SAVINGS38%PENSION BENEFITS 28%HOME EQUITY39%SPOUSE/PARTNERS RETIREMENT SAVINGS 36%IRAS22%INHERITANCE14%RENTAL INCOME6 I 2023 NATIXIS DEFINED CONTRIBUTION PLAN PARTICIPANT SURVEYSocial Security no
38、t as secure for younger workers With hopes for retirement running high and account balances running low,more than six in ten are counting on Social Security to fill the gap.Despite the lingering questions of its long-term sustainability,eight out of ten believe Social Security benefits will be avail
39、able to help fund their retirement,including 86%of Boomers,72%Generation X,and 78%of Millennials.While they are optimistic that benefits will be available,they are realistic in how much those benefits may actually amount to.In part,this may be driven by often-quoted reports that state the Social Sec
40、urity Old Age and Survivors Insurance Trust will be depleted by 2033.Its likely those concerns are amplified by another timely factor:public spending.In fact,our 2021 investor survey showed that 77%of those in the US think rising levels of public debt will result in reduced Social Security benefits
41、in the future.Results of this years plan participant survey show many are already factoring lower benefits payments into their plans.Seven in ten think Social Security benefits will be dramatically reduced when they retire.This includes 83%of Millennials and 78%of Gen X.Only 39%of Boomers see reduce
42、d benefits on the horizon.7 in 10participants think Social Security benefits will be dramatically reduced when they retire.WHERE ARE PARTICIPANTS NOW?BOOMERS FEEL SECURE ABOUT SOCIAL SECURITY.GEN X AND MILLENNIALS,NOT SO MUCH.Social Security benefits will bedramatically reduced when I retire 39%78%8
43、3%BoomersGen XMillennialsWhat do participants want?Their financial outlook on retirement may be optimistic,but those surveyed express big concerns over retirement funding.In fact,anxieties run so deep that many believe mandates will be needed to address the problem.Over-all,the majority are in favor
44、 of mandates for everything from employer-sponsored plans,to matching contribu-tions,even to individual contributions.Millennials,who are most likely to anticipate reduced Social Security benefits in the future,are overwhelmingly in favor of regulatory action on retirement security.Boomers,who are i
45、n or nearing retirement,are much less receptive.Fully 85%of Millennials think government should pro-vide universal access to retirement plans,as does 63%of Generation X.But just 40%of Boomers agree.There is greater agreement(81%overall)on the need for mandates that require employers to offer retirem
46、ent plans a sentiment expressed by 88%of Millennials,79%of Generation X and even 70%of Boomers.More than three-quarters(78%)believe employer contribu-tions should be required,including almost nine out of ten Millennials(87%),three-quarters(74%)of Genera-tion X and two-thirds(67%)of Boomers.The press
47、ure is so great that seven out of ten(69%)think individual retirement plan contributions should be mandated as well.The sentiment is shared by 82%of Millennials,six out of ten in Generation X(59%),and more than half of Boomers(54%).Provisions outlined in the recently enacted SECURE 2.0 provide meani
48、ngful action on access to plans and improved participation.But even as these measures only begin to take effect,88%of plan participants think even more policy changes are needed to ensure people achieve retirement security.Employers should be mandated to offer retirement plansEmployer matching contr
49、ibutions should be made mandatoryIndividual contributions toward retirement savings should be made mandatoryWORKERS ARE OPEN TO RETIREMENT SAVINGS MANDATES88%79%70%87%74%67%82%59%54%Millennials Gen X Boomers8 I 2023 NATIXIS DEFINED CONTRIBUTION PLAN PARTICIPANT SURVEYWHAT DO PARTICIPANTS WANT?SECURE
50、 2.0,a step in the right directionPassed in December 2022 as part of the Consolidated Appropriations Act(HR2627),SECURE 2.0 puts in place new provisions designed to improve retirement outcomes.Some,such as automatic enrollment,are designed to encourage participation and saving.Others,such as student
51、 loan provisions,are designed to ease competing financial pressures that can keep individuals from saving for retirement.Still others are designed to accelerate savings for older workers.Auto-enrollment:Employers who start new retire-ment plans after December 29,2022 will,beginning in 2025,be requir
52、ed to automatically enroll employees at a rate of at least 3 percent,but not more than 10 percent of eligible wages.Employees are free to opt out,but survey data suggests that many are likely to remain in the plan.On average,27%of the 587 individuals surveyed say they were automatically enrolled by
53、their employer.Millennials(31%)were more likely to have joined the plan in this fashion while one-quarter of Generation X(26%)came into the plan this way,as did 21%of Boomers.With mandates taking effect,employers will need to focus on their Qualified Default Investment Alternative as large numbers o
54、f participants tend to stay with that initial investment.In fact,Millennials(40%)were more likely to stick with the QDIA selected for them when they were enrolled.While smaller numbers show that older participants 26%of Generation X and 18%of Boomers stuck with their default investment option,many m
55、ay have begun participating before QDIA was prescribed in the 2006 Pension Protection Act.Student loans:Beginning in 2024,student loan payments made by plan participants can be treated as retirement contributions for the purpose of qualifying for matching contributions in a workplace retirement acco
56、unt.Student loans are often cited as a key sav-ings challenge for younger workers,which is under-standable since Millennials hold an average of$40,000 in student loan debt.1 Given the financial pressures,it is easy to see why there are concerns for its impact on retirement savings.The number of indi
57、viduals who say student loan debt is the reason they dont participate in their workplace retirement plan is relatively low,at 9%of 149 non-par-ticipants overall and 15%of the 60 Millennials who fit in that group.Among the 487 who do participate,12%(and 16%of 302 Millennials in this group)say student
58、 loan debt keeps them from contributing more to their retirement plan.63%of Millennials who do not participate in their employers plan say they will begin to contribute if student loan payment matching benefits take effect.9 I 2023 NATIXIS DEFINED CONTRIBUTION PLAN PARTICIPANT SURVEYStudent loan pro
59、visions are likely to have a greater impact than these numbers indicate,as 42%of those who do not participate(including 63%of non-participant Millennials)say they will begin to contribute when student loan payment matching benefits take effect.Emergency savings:Also beginning in 2024,retirement plan
60、s may offer linked“emergency savings accounts”that permit non-highly-compensated employees to make up to$2,500 in after-tax contribu-tions to a savings account as part of their retirement plan.The feature will be welcomed by many plan participants as 73%overall and 88%of Millennial participants inte
61、nd to contribute additional money to their 401(k)to take advantage of the new emergency vehicle once incorporated into their plan.This plan feature may also serve as a strong incentive to convert non-participants.Overall,54%of non-partic-ipants and 77%of Millennial non-participants say they intend t
62、o begin plan participation once emergency sav-ings features become available.In essence,the emergency savings feature is designed to keep individuals from raiding their retirement savings when they are under financial stress,and should help a large number of plan participants preserve their savings.
63、Its important to note just how many partici-pants are forced to turn to plan savings in a pinch.One-quarter of those surveyed,including 38%of Mil-lennials,have taken an early withdrawal from their re-tirement plan over the past 12 months.Another 28%of participants,including 38%of Millennials and 37%
64、of Generation X,say they have taken a loan against their retirement plan balance in the same time frame.Catch-up contributions:SECURE 2.0 also considers the funding challenge facing many older workers by upping catch-up contributions.Now,those aged 50 and older who reach the maximum allowable contri
65、butions of$22,500 can add another$7,500 in catch-up contribu-tions,taking the maximum contribution level to$30,000 annually.Then,beginning in 2025,the catch-up amount will increase to$10,000 per year for participants aged 60 to 63.Also,after 2023,all catch-up contributions for participants earning o
66、ver$145,000 annually must be made on a Roth(after-tax)basis.Half of those over 50 say they will take advantage of increased catch-up limits,but only 18%of participants who currently qualify make any catch-up contributions.A small segment of 40 individuals in Generation X who are over 50 suggests tha
67、t they may be more inclined to use catch-up contributions as 31%do so today,though the number of individuals(10)is too small to be conclusive.WHAT DO PARTICIPANTS WANT?54%of those who dont participate say they intend to contribute when emergency savings features become available.10 I 2023 NATIXIS DE
68、FINED CONTRIBUTION PLAN PARTICIPANT SURVEYDOL says participant preferences matter The provisions of SECURE 2.0 give plan sponsors a number of new levers to help increase participation and contribution.But a second,separate ruling,the US Department of Labors Prudence and Loyalty in Selecting Plan Inv
69、estments and Exercising Shareholder Rights,adds another critical incentive to the mix:investment selection.While the DOL continues to maintain investments in plans should make financial considerations the primary concern,fiduciaries on ERISA plans may consider participant preferences when selecting
70、plan investment options.In the case of sustainable investments,this means they will still have to focus on relevant risk and return factors and investments must not sacrifice re-turns in exchange for other objectives.Plan participants agree DC plan participants show a remarkably high level of intere
71、st and engagement around ESG(environmental,social and governance)issues and sustainable invest-ments.In fact,nearly three-quarters(73%)of individuals eligible for plan participation go so far as to say that they would be more likely to participate in a plan or increase their contributions if they we
72、re offered invest-ments in companies with good environmental,social,and governance practices.As might be expected,younger workers were most interested.Overall,Millennials(88%)are the most likely to see access to investments in these types of companies as an incentive to save,but so do 72%of Generati
73、on X.Most surprising is the 49%of Boomers who also agree.The fact that the number is so high among a group composed of pre-retirees and retirees is a telling sign that even as they near the end of working life,many want more motivation to help them be better prepared for retirement.WHAT DO PARTICIPA
74、NTS WANT?83%of those surveyed believe companies that focus on sustainable business practices present significant growth opportunities for their investments.11 I 2023 NATIXIS DEFINED CONTRIBUTION PLAN PARTICIPANT SURVEYEnlightened self-interest drives preferences Even as some critics cling to old def
75、initions and assume that sustainable investment goals can only be made at the expense of investment performance,those surveyed take a much different view.In fact,83%of those surveyed believe companies that focus on sustainable business practices present signif-icant growth opportunities for their in
76、vestments.While Millennials(91%)are most likely to share this belief,the majority of Generation X(78%)and Boomers(74%)also see an investment opportunity represented in compa-nies that fit the bill on sustainable business practices.This runs counter to the outdated view that sees sustain-able investm
77、ents only in terms of the negative screens that were a hallmark of old-school socially responsible investing.Data shows that a large number of participants view sustainable investments as something that provides new investment opportunity,rather than something that excludes companies that underperfo
78、rm on sustainability.For example,almost half(48%)of those surveyed shared an interest in investments that benefit from long-term trends such as clean energy,changing demographics,and technology.This includes close to six in ten(56%)Millennials,more than four in ten(44%)of Generation X,and almost fou
79、r in ten(37%)Boomers.This contrasts starkly with the small number(29%)of respondents who said they want to ensure their investments do not support companies that harm the environment(33%of Millennials,28%of Gen X,25%of Boomers).When it comes to sustainable investments,the data shows that participant
80、s think differently about the E,the S,and the G.One-third(34%)say they care about environ-mental issues when selecting investments in their company-sponsored retirement plan.This includes more than four in ten Millennials(42%)and just 21%of Boomers.Almost the same overall number(32%)said they care a
81、bout social factors when selecting investments.This included 38%of Millennials,33%of Gen X,and 20%of Boomers.Surprisingly,fewer individuals said they cared about corporate governance issues,including only 32%of Millennials and just 23%for Gen X and Boomers.Perhaps the most telling data point is the
82、relatively small number of participants who say they dont care about ESG issues at all.Only one in five said they dont care about these issues when selecting investments in their retirement plan,a number that is on par with what we have seen in past editions of the Natixis Global Survey of Individua
83、l Investors.Even that overall number is skewed by older participants:Only 8%of Millennials and 22%of Gen X said they dont care.Boomers appeared to be most ambivalent about these issues as 41%said they dont care.WHAT DO PARTICIPANTS WANT?12 I 2023 NATIXIS DEFINED CONTRIBUTION PLAN PARTICIPANT SURVEYP
84、articipants want even more Beyond the new provisions of SECURE 2.0 and the DOL guidance,plan participants put a large range of invest-ments on their wish list.Most notably,90%of plan participants would like to have access to retirement income options in their companys retirement plan.This includes n
85、ot just older workers(88%of Boomers and 86%of Generation X)but 92%of Millennials.A large number of participants(79%)would like to see alternative investments such as private equity and hedge fund options added to the menu.Crypto-currency is also showing up on the radar screen for 55%of participants
86、but is of particular interest to younger participants,as 78%of Millennials would like to see a crypto option in their plan.The number is particularly surprising in that the sentiment comes after the big losses suffered by cryptocurrencies in 2022 and the ongoing drama over FTX as that exchange colla
87、psed late in 2022.When it comes down to it,participants are looking for all the help they can get in striving to fund retirement.They want the help because they are facing some significant obstacles on the road to retirement security.Bridging the gap on sustainable investments While all respondents
88、register positive sentiment on sustainable investments,Millennials and Generation X participants show clear preferences for including sustainable investments in their companys retirement plan.Bottom line:This preference could help drive participation and contribution rates.WHAT DO PARTICIPANTS WANT?
89、Millennials Gen X BoomersESG factors can affect investment performanceI would like to see more sustainable investments in my retirement planI would be more likely to increase my contributions or begin participating if I could invest in companies with good ESG records94%86%87%92%81%65%88%72%45%Why do
90、 participants need help?Retirement savings has long had to compete with other long-term financial goals like buying a home or paying for college.But now plan participants face more imme-diate financial pressures as they look to navigate the in-flation that spiked during the pandemic,peaked at a 40-y
91、ear high in 2022,and has only now begun to moderate.Inflation:the top barrier to retirement savings When asked what keeps them from saving more for retire-ment,44%of plan participants say“Inflation is eating up too much of my paycheck.”The pressure is felt equally by all participants including Mille
92、nnials(44%),Gen X(44%),and Boomers(45%).But Millennials may be feeling that pain more acutely,simply because of where they are in life.Overall,43%of Millennials also say they are limited in what they can save because they are prioritizing other financial goals.Fewer in Generation X(30%)and even fewe
93、r Boomers(24%)find that these priorities limit their ability to save more.One reason the difference may be so great is that Millennials,who are now between the ages of 25 and 42,are entering a life stage in which their financial responsibilities are growing as they get married,buy homes,have childre
94、n,and start saving for their kids education.High levels of inflation make meeting all those goals even more challenging.Personal debt,which reached$16.9 trillion in the US at the end of 2020,2 adds to the challenge.Almost three in ten Millennials(28%)say they have too much debt to pay and it is keep
95、ing them from saving more,as is the case for 26%of Generation X.But Boomers(16%),many of whom are further removed from the financial responsibilities of rais-ing a family,are less likely to see debt as an issue.The high cost of health insurance adds yet another barri-er for participants.After seeing
96、 the average cost of health insurance increase by 24.3%,3 one-quarter of participants say high insurance costs are also keeping them from sav-ing.In this case,Millennials(29%)were twice as likely as Boomers(14%)were to cite the cost of insurance.One in five among Generation X see the same savings ch
97、allenge.When it comes down to it,in a time when prices are ris-ing faster than wages,4 plan participants are forced to make tough choices about where their earnings will go.Higher bills for heat,homes,food,and even health insur-ance are adding up to a significant challenge.Fewer than one in five(18%
98、)say they hold back on savings because they want to spend money and enjoy life now.WHY DO PARTICIPANTS NEED HELP?44%INFLATION IS EATING UP TOO MUCH OF MY PAYCHECK37%I AM PRIORITIZING OTHER FINANCIAL GOALS 26%I HAVE TOO MUCH DEBT TO PAY 25%HIGH COST OF HEALTH INSURANCE18%ID RATHER SPEND MY MONEY AND
99、ENJOY LIFE NOWWhat keeps them from saving more?Not only do higher costs,rising levels of debt,and com-peting financial priorities limit how much they save;trying to keep pace with these same factors can also deplete the accounts of many plan participants.Overall,25%of plan participants say theyve ta
100、ken an early with-drawal from their retirement plan savings,while another 28%say they have taken a loan.And those numbers are driven by younger participants.When asked why they are willing to tap the savings they will need many years down the road,participants point to the pressures they are feeling
101、 right now.The high cost of living is a leading factor in the decision to make a withdrawal.Healthcare costs(37%),paying down debt(35%)and monthly living expenses that have become too high(33%)are three common motivations to tap retirement savings.Another 12%overall and 16%of Millennials add student
102、 loan debt to the mix as well.The high cost of living has had a particularly strong effect on those in Generation X as 46%cite increased monthly living expenses for taking a withdrawal,a number that exceeds even the 35%who had to pay down debt.Beyond paying down debt and meeting monthly bills,partic
103、ipants cite home repairs(34%)and a medical emergency as their reason for taking a withdrawal in the past 12 months.Both are issues that new emergency savings provisions could help address.Other reasons participants have for dipping into long-term retirement savings include buying a home(30%)and payi
104、ng for a large expense like a wedding(29%).Both tend to be line with the life stage that many Millennials and some members of Generation X find themselves in.Essentially,when faced with expensive situations a significant number are willing to tap the single largest pool of assets many individuals wi
105、ll accumulate in their lifetime.Why they dont participate Many of the same issues that limit savings and lead to withdrawals keep some individuals from even participating in their workplace retirement savings plan altogether.Most frequently those who dont participate say the reason is that they are
106、prioritizing other goals(26%).This is felt more acutely by Millennials(38%),who are at a life stage when they are encountering the financial challenges of buying homes and starting families.Prioritization of goals is a factor for fewer older workers,including just 16%of Boomers and just 18%of Genera
107、tion X.In fact,more immediate concerns are keeping Generation X from participating.They cite inflation eating up their paycheck(31%),and they have too much personal debt(29%)that keeps them out of their employers plan.Among Boomers,34%say they dont participate simply because their employer match is
108、too small.15 I 2023 NATIXIS DEFINED CONTRIBUTION PLAN PARTICIPANT SURVEYWhat plan sponsors can do The challenge of increasing plan participation rates is nothing new for plan sponsors.But for the first time in a long while,sponsors have new tools at their disposal that can help address the issue.Mos
109、t importantly,there are more ways to give the people what they want.Of course,a bigger match(65%)and bigger tax incen-tives(57%)rank as the top incentives that participants say will get them to increase their contributions.A big-ger match(71%)is also a top incentive cited by non-par-ticipants as som
110、ething that could bring them into the plan.But with recent legislative and regulatory develop-ments,plan sponsors wont have to rely solely on the match to motivate plan participants.SECUREing participation and engagement in plan design SECURE 2.0 goes a long way to breaking down some of the barriers
111、 to plan participation and contributions.While many of these new features are mandated for plans initiated after December 2022,they still make sense for existing plans:Personal debt,including student loan debt,is one of the key barriers that not only keep people from savings,but are also among the l
112、eading reasons why participants make withdrawals.Sponsors who implement new stu-dent loan match provisions introduced by the legislation will be set up to not only keep participants in the plan,but also provide an incentive for broader participation among employees.Financial emergencies can hit at a
113、ny time,but they can pose even greater challenges now when inflation is taking a significant bite out of disposable income and personal debt is on the rise.Integrating new emergency savings features will be especially helpful to those employees who are not high earners(under$145,000 annual salary),g
114、iving them a cushion for addressing emergencies.New catch-up provisions increase qualified plan savings limits to$30,000 for workers over the age of 50.Based on median savings levels of Generation X($81,000)and Boomers($170,000),they need all the help they can get.Providing education on how catch-up
115、 contributions can impact their savings and access to financial planning services may be needed to help get them to the goal.16 I 2023 NATIXIS DEFINED CONTRIBUTION PLAN PARTICIPANT SURVEYWHAT PLAN SPONSORS CAN DOMeeting participant preferences DOLs Prudence and Loyalty in Selecting Plan Invest-ments
116、 and Exercising Shareholder Rights ruling gives plan sponsors another lever to enhance participation and contribution rates by allowing them to consider participant preferences in building out their investment offerings.Adding sustainable investment fund options will help address the preferences of
117、almost three-quarters(73%)of individuals eligible for plan participation and close to nine out of ten(88%)Millennials who say they would be more likely to participate or increase contributions if they could access investments in companies with good environmental,social,and ethical practices.However,
118、it will be important for fiduciaries to continue considering relevant risk and return factors and look at investments that dont sacrifice returns in exchange for other objectives.Based on survey feedback,these sustainable investments appeal most to participants.In fact,this view aligns with the 83%o
119、f eligible employees who believe investing in companies that focus on sustainable business practices presents significant growth opportunities.Lifetime plan participation Many sponsors would do well to look at features that encourage what can best be described as lifetime participation.In particular
120、,offering retirement income solutions will be most welcomed by all plan participants.Given the complexity of navigating a multi-stream in-come plan,many participants welcome the simplifica-tion of at least one income source,their plan savings.Overall,91%of plan participants would like access to reti
121、rement income options within their plan.This includes 92%of Millennials.This generation,which is facing uncertainty about Social Security benefits,would like some certainty in their income plan.In fact,the 2021 Natixis Investor survey found that this gener-ation,which is only entering their 40s,list
122、s retirement income planning as one of the services they most want from a financial advisor.5Other considerations Plan participants express strong preferences on a number of fronts.Some,like emergency savings,student loan matches,and access to sustainable investments,are readily addressed with recen
123、t legislation and DOL rules.Others,like access to private equity,hedge funds,and cryptocurrencies,will bear closer consideration of the risks and are most appropriately accessed as part of a multi-asset offering rather than a stand-alone investment.Regardless of how those explorations turn out,it is
124、 safe to say that qualified plans are entering a new era in which the best path forward will be an open dialogue with participants.In the end,giving the people what they want may be the best strategy for ensuring retirement security among workers.91%would like access to retirement income options wit
125、hin their plans,including 92%of Millennials.17 I 2023 NATIXIS DEFINED CONTRIBUTION PLAN PARTICIPANT SURVEYAbout the 2023 Survey of Defined Contribution Plan ParticipantsNatixis Investment Managers,Survey of US Defined Contribution Plan Participants conducted by CoreData Research,January and February
126、 2023.Survey included 736 US workers,587 being plan participants and 149 being non-participants.Of the 736 respondents,362 were Millennials(age 2742),166 were Gen X(age 4358)and 208 were Baby Boomers(age 59 and above).About the Natixis Center for Investor InsightThe Natixis Center for Investor Insig
127、ht is a global research initiative focused on the critical issues shaping todays investment landscape.The Center examines sentiment and behavior,market outlooks and trends,and risk per-ceptions of institutional investors,financial professionals and individuals around the world.Our goal is to fuel a
128、more substantive discussion of issues with a 360 view of markets and insightful analysis of investment trends.Meet the team:Dave Goodsell Executive DirectorStephanie Giardina Program ManagerErin Curtis Assistant Program ManagerJessie Cross AVP,ContentLearn moreWatch for our next surveys:Financial Ad
129、visor Fixed Income focus Individual Investor Global Retirement Index18 I 2023 NATIXIS DEFINED CONTRIBUTION PLAN PARTICIPANT SURVEY1.Experian(April 29,2022).Average value of student loan debt held in the Unit-ed States in 2021,by generation(in U.S.dollars)Graph.InStatista.Retrieved March 27,2023,from
130、 https:/ Household Debt Reaches$16.90 Trillion in Q4 2022;Mortgage and Auto Loan Growth Slows.https:/www.newyorkfed.org/newsevents/news/re-search/2023/20230216.3.Bureau of Labor Statistics(October 5,2022).Annual health insurance price inflation rate in the U.S.from 2007 to 2022 Graph.InStatista.Retr
131、ieved March 27,2023,from https:/ 13,2022).Americans Suffer Pay Cut as Inflation Outpac-es Wage Growth Digital image.Retrieved March 27,2023,from https:/ Natixis Global Survey of Individual Investors,conducted March-April 2021,included 8,550 individuals in 24 countries.The views and opinions expresse
132、d may change based on market and other conditions.This material is provided for informational purposes only and should not be construed as investment advice.There can be no assurance that devel-opments will transpire as forecasted.Actual results may vary.All investing involves risk,including the ris
133、k of loss.No investment strategy or risk management technique can guarantee return or eliminate risk in all market environments.The data shown represents the opinion of those surveyed,and may change based on market and other conditions.It should not be construed as investment advice.Sustainable inve
134、sting focuses on investments in companies that relate to cer-tain sustainable development themes and demonstrate adherence to environ-mental,social and governance(ESG)practices;therefore the universe of invest-ments may be limited and investors may not be able to take advantage of the same opportuni
135、ties or market trends as investors that do not use such criteria.This could have a negative impact on an investors overall performance depend-ing on whether such investments are in or out of favor.You cannot invest direct-ly in an index.Indexes are not investments,do not incur fees and expenses and
136、are not professionally managed.Volatility management techniques may result in periods of loss and underperformance,may limit the Funds ability to partici-pate in rising markets and may increase transaction costs.This document may contain references to copyrights,indexes and trademarks that may not b
137、e registered in all jurisdictions.Third party registrations are the property of their respective owners and are not affiliated with Natixis Investment Managers or any of its related or affiliated companies(collectively“Natixis”).Such third party owners do not sponsor,endorse or participate in the pr
138、ovision of any Natixis services,funds or other financial products.The index information contained herein is derived from third parties and is pro-vided on an“as is”basis.The user of this information assumes the entire risk of use of this information.Each of the third party entities involved in compi
139、ling,computing or creating index information disclaims all warranties(including,without limitation,any warranties of originality,accuracy,completeness,time-liness,non-infringement,merchantability and fitness for a particular purpose)with respect to such information.The views and opinions expressed m
140、ay change based on market and other conditions.This material is provided for informational purposes only and should not be construed as investment advice.There can be no assurance that devel-opments will transpire as forecasted.Actual results may vary.All investing involves risk,including the risk o
141、f loss.No investment strategy or risk management technique can guarantee return or eliminate risk in all market environments.Outside the United States,this communication is for information only and is intended for investment service providers or other Professional Clients.This material must not be u
142、sed with Retail Investors.This material may not be redis-tributed,published,or reproduced,in whole or in part.Although Natixis Invest-ment Managers believes the information provided in this material to be reliable,including that from third party sources,it does not guarantee the accuracy,adequacy or
143、 completeness of such information.In the EU(ex UK):Provided by Natixis Investment Managers S.A.or one of its branch offices listed below.Natixis Investment Managers S.A.is a Luxembourg management company that is authorized by the Commission de Surveillance du Secteur Financier and is incorporated un
144、der Luxembourg laws and registered under n.B 115843.Reg-istered office of Natixis Investment Managers S.A.:2,rue Jean Monnet,L-2180 Luxembourg,Grand Duchy of Luxembourg.France:Natixis Investment Manag-ers Distribution(n.509 471 173 RCS Paris).Registered office:43 avenue Pierre Mends France,75013 Par
145、is.Italy:Natixis Investment Managers S.A.,Succurs-ale Italiana(Bank of Italy Register of Italian Asset Management Companies no 23458.3).Registered office:Via Larga,2-20122,Milan,Italy.Germany:Natixis Investment Managers S.A.,Zweigniederlassung Deutschland(Registration number:HRB 88541).Registered of
146、fice:Im Trutz Frankfurt 55,Westend Carre,7.Floor,Frankfurt am Main 60322,Germany.Netherlands:Natixis Investment Managers,Nederlands(Registration number 50774670).Registered office:Stadsplateau 7,3521AZ Utrecht,the Netherlands.Sweden:Natixis Investment Managers,Nordics Filial(Registration number 5164
147、05-9601-Swedish Compa-nies Registration Office).Registered office:Kungsgatan 48 5tr,Stockholm 111 35,Sweden.Spain:Natixis Investment Managers,Sucursal en Espaa.Serrano n90,6th Floor,28006 Madrid,Spain.In Switzerland:Provided by Natixis Invest-ment Managers,Switzerland Srl,Rue du Vieux Collge 10,1204
148、 Geneva,Swit-zerland or its representative office in Zurich,Schweizergasse 6,8001 Zrich.In the UK:Provided by Natixis Investment Managers UK Limited,authorized and regulated by the Financial Conduct Authority(register no.190258).Registered Office:Natixis Investment Managers UK Limited,One Carter Lan
149、e,London,EC4V 5ER.In the DIFC:Distributed in and from the DIFC financial district to Profes-sional Clients only by Natixis Investment Managers Middle East(DIFC Branch)which is regulated by the DFSA.Related financial products or services are only available to persons who have sufficient financial exp
150、erience and understanding to participate in financial markets within the DIFC,and qualify as Professional Clients as defined by the DFSA.Registered office:Office 603-Level 6,Currency House Tower 2,PO Box 118257,DIFC,Dubai,United Arab Emirates.In Singapore:Provided by Natixis Investment Managers Sing
151、apore(name registration no.53102724D),a division of Ostrum Asset Management Asia Limited(company registration no.199801044D).Registered address of Natixis Investment Manag-ers Singapore:5 Shenton Way,#22-05 UIC Building,Singapore 068808.In Taiwan:Provided by Natixis Investment Managers Securities In
152、vestment Consulting(Taipei)Co.,Ltd.,a Securities Investment Consulting Enterprise regulated by the Financial Supervisory Commission of the R.O.C.Registered address:16F-1,No.76,Section 2,Tun Hwa South Road,Taipei,Taiwan,Da-An District,106(Ruentex Financial Building I),R.O.C.,license number 2017 FSC S
153、ICE No.018,Tel.+886 2 2784 5777.In Japan:Provided by Natixis Investment Managers Japan Co.,Ltd.,Registration No.:Director-General of the Kanto Local Financial Bureau(kinsho)No.425.Content of Business:The Company conducts discre-tionary asset management business and investment advisory and agency bus
154、i-ness as a Financial Instruments Business Operator.Registered address:1-4-5,Roppongi,Minato-ku,Tokyo.In Hong Kong:Provided by Natixis Investment Managers Hong Kong Limited to institutional/corporate professional investors only.Please note that the content of the above website has not been reviewed
155、or approved by the HK SFC.It may contain information about funds that are not authorized by the SFC.In Australia:Provided by Natixis Investment Managers Australia Pty Limited(ABN 60 088 786 289)(AFSL No.246830)and is intended for the general information of financial advisers and wholesale clients on
156、ly.In New Zealand:This document is intended for the general information of New Zealand wholesale investors only and does not constitute financial advice.This is not a regulated offer for the purposes of the Financial Markets Conduct Act 2013(FMCA)and is only available to New Zealand investors who ha
157、ve certified that they meet the requirements in the FMCA for wholesale investors.Natixis Investment Managers Australia Pty Limited is not a registered financial service provider in New Zealand.In Latin America:Provided by Natixis Investment Man-agers S.A.In Colombia:Provided by Natixis Investment Ma
158、nagers S.A.Oficina de Representacin(Colombia)to professional clients for informational pur-poses only as permitted under Decree 2555 of 2010.Any products,services or investments referred to herein are rendered exclusively outside of Colombia.In Mexico:Provided by Natixis IM Mexico,S.de R.L.de C.V.,w
159、hich is not a regulat-ed financial entity or an investment manager in terms of the Mexican Securities Market Law(Ley del Mercado de Valores)and is not registered with the Comis-in Nacional Bancaria y de Valores(CNBV)or any other Mexican authority.Any products,services or investments referred to here
160、in that require authorization or license are rendered exclusively outside of Mexico.Natixis Investment Manag-ers is an entity organized under the laws of France and is not authorized by or registered with the CNBV or any other Mexican authority to operate within Mex-ico as an investment manager in t
161、erms of the Mexican Securities Market Law(Ley del Mercado de Valores).Any use of the expression or reference contained herein to“Investment Managers”is made to Natixis Investment Managers and/or any of the investment management subsidiaries of Natixis Investment Man-agers,which are also not authoriz
162、ed by or registered with the CNBV or any other Mexican authority to operate within Mexico as investment managers.In Uru-guay:Provided by Natixis Investment Managers Uruguay S.A.,a duly registered investment advisor,authorized and supervised by the Central Bank of Uruguay.Office:San Lucar 1491,oficin
163、a 102B,Montevideo,Uruguay,CP 11500.The above referenced entities are business development units of Natixis In-vestment Managers,the holding company of a diverse lineup of specialized investment management and distribution entities worldwide.The investment management subsidiaries of Natixis Investmen
164、t Managers conduct any regu-lated activities only in and from the jurisdictions in which they are licensed or authorized.Their services and the products they manage are not available to all investors in all jurisdictions.In the United States:Provided by Natixis Distribution,LLC,888 Boylston St.,Bost
165、on,MA 02199.Natixis Investment Managers includes all of the investment management and distribution entities affiliated with Natixis Distribution,LLC and Natixis Investment Managers S.A.This material should not be considered a solicitation to buy or an offer to sell any product or service to any person in any jurisdiction where such activity would be unlawful.5591906.1.1