Q: Erick, following a recent educational campaign, employee uptake of the Roth contribution option in our workplace retirement plan increased to just over 20%. How does this compare with the industry average?
A: Wow, that’s exciting! According to Vanguard’s “How America Saves 2024,” 82% of employers offer a Roth 401(k) option in addition to a traditional 401(k) option. However, just 17% of employees contribute to a Roth. While offering a Roth option in your workplace retirement plan makes great sense, employees may not take advantage of it without a little nudge. Implementing an education campaign focusing on Roth versus traditional options is a great way to promote awareness and give your employees an informed choice.
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Disclosures, Sources, and Footnotes
For plan sponsor use only, not for use with participants or the general public. This information is not intended as authoritative guidance or tax or legal advice. You should consult with your attorney or tax advisor for guidance on your specific situation.
Kmotion, Inc., 12336 SE Scherrer Street, Happy Valley, OR 97086; www.kmotion.com
©2024 Kmotion, Inc. This newsletter is a publication of Kmotion, Inc., whose role is solely that of publisher. The articles and opinions in this publication are for general information only and are not intended to provide tax or legal advice or recommendations for any particular situation or type of retirement plan. Nothing in this publication should be construed as legal or tax guidance; nor as the sole authority on any regulation, law or ruling as it applies to a specific plan or situation. Plan sponsors should consult the plan’s legal counsel or tax advisor for advice regarding plan-specific issues.
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