What Determines 401(k) Participation and Contributions?

Munnell, Alicia H.; Sundén, Annika; Taylor, Catherine

doi:10.2139/ssrn.253037

Cited by 91 publications

(106 citation statements)

References 6 publications

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“…Second, many individuals find it difficult to make long-term plans. Munnell, Sunden, and Taylor (2000) support this theory, reporting that shorter planning horizons reduced participant contribution rates.…”

Section: Saving By Switched Employeesmentioning

confidence: 71%

Understanding the Defined Benefit versus Defined Contribution Choice

Yang

2005

SSRN Journal

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Section: Saving By Switched Employeesmentioning

confidence: 71%

Understanding the Defined Benefit versus Defined Contribution Choice

Yang

2005

SSRN Journal

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“…The general consensus is that participation and contributions are positively related to age, income, education and job tenure and negatively related to the presence and generosity of a defined benefit plan. Plan characteristics such as the presence of a matching contribution by employers, quality of informational material are also found to be important determinants of participation and contributions (Papke, 1995;Bernheim and Garrett, 1996;Bassett, Fleming, and Rodrigues, 1998;Guariglia and Markose, 2000;Munnell, Sunden, and Taylor, 2002).…”

Section: The Research Settingmentioning

confidence: 96%

In Search of Inclusion: Informal Sector Participation in a Voluntary, Defined Contribution Pension System

Sane

Thomas

2015

The Journal of Development Studies

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This paper examines who contributes and who persists in contributing in a national, voluntary, defined contributory pension program, where the government provides the incentive of matching contributions of a minimum amount (USD 16Abstract This paper examines who contributes and who persists in contributing in a national, voluntary, defined contributory pension program, where the government provides the incentive of matching contributions of a minimum amount (USD 16). The paper uses proprietary data from a financial services firm where 12 percent of customers (37000 individuals) chose to participate in this program. The evidence shows that only about 50 percent of contributors reach the minimum amount for the co-contribution, but that participants persist in contributing even if they failed to contribute the minimum amount in a given year. While this paper does not provide causal estimates, it does present evidence of considerable interest among the informal sector in a state-run voluntary pension program in a emerging market where access to formal finance is otherwise poor.

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“…This result is consistent with that in Clark and Schieber, 14 who fi nd no difference between the 401(k) contribution rates of participants that do or do not have a DB pension plan. 15 Different from the effect of DB plans, the coeffi cient of having IRA is signifi cantly negative, which suggests that DC plans and IRAs are substitutes in tax-deferred saving. This result is consistent with Engelhardt and Kumar, 16 who fi nd that the estimated after-tax cross-price elasticity of 401(k) contributions with respect to IRA saving is negative.…”

Section: Results For Basic Regressionmentioning

confidence: 94%

Investment choice and savings in defined contribution pensions

2012

Pensions Int J

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This article presents econometric evidence from Health and Retirement Study on the role that investment choice plays in the participants ' saving levels in the defi ned contribution (DC) pensions. I distinguish the effect of unconstrained investment choice from the one constrained in company stocks. My preferred estimates indicate that participants with investment choice contribute over three percentage points more of their salary into the DC plan than people without choice, and people constrained in company stocks contribute about three percentage points less in their retirement saving account.

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What Determines 401(k) Participation and Contributions?

Cited by 91 publications

References 6 publications

Understanding the Defined Benefit versus Defined Contribution Choice

Understanding the Defined Benefit versus Defined Contribution Choice

In Search of Inclusion: Informal Sector Participation in a Voluntary, Defined Contribution Pension System

Investment choice and savings in defined contribution pensions

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