Commemorating 50 years of the Employee Retirement Income
Security Act and its impact on retirement savings in
America
BALTIMORE, Sept. 12,
2024 /PRNewswire/ -- T. Rowe
Price, a global investment management firm and a leader in
retirement, today published a new white paper to mark the
50th anniversary of the Employee Retirement Income
Security Act of 1974 (ERISA). The paper explores how defined
contribution (DC) plans have improved the retirement savings
landscape in America in the ERISA era and ways that DC plans
can continue to support the evolving and diverse needs of
retirement savers.
"Today, industry leaders, lawmakers and policy influencers
gathered in Washington D.C. to
celebrate 50 years of ERISA," said Sudipto
Banerjee, director of retirement thought leadership at T.
Rowe Price, author of the white
paper, and speaker at today's event. "It was an incredible honor to
speak at the ERISA symposium among fellow retirement leaders.
Reflecting on the strong foundation ERISA has laid for retirement
savings and discussing how we can build on its success was both
inspiring and vital. Together, we can guide even more savers toward
better retirement outcomes."
Key insights from The Success of Defined Contribution Plans and
the Road Ahead include:
- According to the Investment Company Institute, today, defined
contribution plans across the private sector, government agencies,
and non-profits, along with IRAs, account for 63% of the
$40 trillion in U.S. retirement
market assets
- Defined contribution plans have expanded retirement plan access
and participation, increased savings rates, and provided
diversified investments for U.S. workers
- Wider adoption of auto-features, such as automatic enrollment,
reenrollment, and auto escalation, could significantly enhance
participation and outcomes. According to T. Rowe Price data, retirement plans with
auto-enrollment have an 83% participation rate compared to 36% for
plans without it
- According to data from the Survey of Consumer Finances, more
than three-quarters of total liquid financial assets of
middle-income families are invested in retirement accounts
- American workers can meaningfully replace their income in
retirement through the combination of employer-sponsored retirement
savings plans and Social Security
- Protecting Social Security, delivering retirement income
solutions, and addressing savings barriers for workers could also
improve the retirement system
"As a leader in retirement, T. Rowe
Price recognizes the important role we have in driving
positive change and innovation in the retirement industry," said
Michael Davis, head of global
retirement strategy at T. Rowe
Price. "Defined contribution plans have become the vital
force behind a secure retirement for most U.S. workers, and while
ERISA has laid a strong foundation for retirement savings in
America, the work is not yet done. By focusing on adoption of
effective auto-features, addressing racial and gender savings
disparities, and delivering personalized solutions for workers, we
can continue to improve retirement coverage and outcomes for all
Americans."
ABOUT T. ROWE PRICE
Founded in 1937, T. Rowe Price
(NASDAQ – GS: TROW) helps individuals and institutions around the
world achieve their long-term investment goals. As a large global
asset management company known for investment excellence,
retirement leadership, and independent proprietary research, the
firm is built on a culture of integrity that puts client interests
first. Clients rely on the award-winning firm for its retirement
expertise and active management of equity, fixed income,
alternatives, and multi-asset investment capabilities. T.
Rowe Price serves millions of
clients globally and manages US $1.61
trillion in assets under management as of August 30, 2024. About two-thirds of the assets
under management are retirement-related. News and other updates can
be found on Facebook,
Instagram, LinkedIn, X, YouTube,
and troweprice.com/newsroom.
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SOURCE T. Rowe Price Group