As anyone who reads our blog knows, we believe that the only “true” retirement program is the defined benefit plan. However, given that most of the private sector no longer have access to this benefit, improving defined contribution plans so that they look less like glorified savings accounts and more like retirement vehicles is imperative. To that end, there have been important changes that are helping Americans (those with some disposable income) to save toward the building of a dignified retirement.

One of the most important improvements in plan design is the automatic enrollment feature in which participants have to opt out from participating. As the above chart highlights, those that are placed into a DC plan are far more likely to contribute something than those that have to sign-up. Now, if we could get plans to stop offering loans and premature withdrawals we might just have something that looks more like a retirement account.