The Influence of Automatic Enrollment, Catch-Up, and IRA Contributions on 401(k) Accumulations at Retirement

Abstract:     
This paper builds on the model scenarios presented in Holden and VanDerhei ("Can 401(k) Accumulations Generate Significant Income for Future Retirees?" ICI Perspective, Vol. 8, no. 3, and EBRI Issue Brief 251, November 2002; and Appendix: EBRI/ICI Accumulation Projection Model, ICI Perspective, Vol. 8, no. 3A, November 2002 - Appendix). It presents new scenarios that examine the role that 401(k) accumulations might play in retirement by analyzing certain factors that influence outcomes for 401(k) participants, including: plan design, through automatic enrollment; tax policy, through catch-up contributions; and individuals themselves, through saving in IRAs when not offered 401(k) plans.

Number of Pages in PDF File: 28

Keywords: 401(k) plans, Employment-based benefits, Income replacement rate, Individual retirement accounts (IRAs), Pension plan contributions, Pension plan coverage, Pension plan design, Retirement income

JEL Classification: D31, D91, J26, J33

Accepted Paper Series