With an increased focus on retirement income, employers are now turning their attention to how their workers are using their defined contribution plan assets after terminating employment. To help organizations better evaluate the distribution decisions people make when they leave employment, Alight Solutions analyzed the post-termination behavior of more than 2 million DC participants from 2008 - 2017.
Data from this report can help employers benchmark their plan’s data and answer the following questions about what workers do with their retirement savings after they leave employers.
- What do people do with their balances when they terminate employment?
- What percentage of eligible assets leaves the plan?
- How do distribution decisions differ by demographics?
- Where do rollovers go?
In answering these questions, particular attention was paid to individuals who were at least 60 years old at the time of termination, since they were most likely to be considered “retired”—and DC plans at their heart are retirement plans.