• Participant Preference Model

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Participant Preference Model

The Participant Preference Model is a proprietary tool we developed specifically to help plan sponsors design more effective defined contribution plans. It has been used by more than 350 plan sponsors to anticipate how plan changes could impact participants’ savings and investing choices.

For example, are you sure you know whether your participants prefer:

• auto-enrollment or Internet features? 
• advice scope or fund breadth? 
• funds specifically run for the plan or top-branded mutual funds? 
• actively managed funds or index funds?

The answers depend on the type of participants in your plan, as well as the plan’s structure and features, such as company match provisions, vesting schedules, education offered, fund selection, and more.

Our Participant Preference Model removes the guesswork by replicating all your current plan features and then predicting how participants are likely to respond to changes to the plan. There are two Models that can help you with your plan and fund changes:

• one lets you see how participants might react to changes in the investment choices
• the second lets you see how participants might react to changes in plan features

The modeling software was based off of a survey of 900 employees that are currently contributing to defined contribution plans across the United States.  This broad range of employees have varying demographics consistent with the United States population. It provides an accurate way for plan sponsors to assess what participants are thinking, and then anticipate how they might respond to changes in a plan’s features or investment choices.

Participant Preference Model Overview

For questions regarding your personal 401(k) plan, contact your 401(k) plan provider.

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