Companies raise default rates for 401(k) contributions

03/7/2013 | MarketWatch

More companies are automatically enrolling workers in 401(k) plans, and now a growing number are upping the percentage of the default contribution, new research from Bank of America Merrill Lynch shows. Instead of the once-standard 3% contribution rate, the default is 4% or higher among almost half the auto-enrollment plans that Bank of America Merrill Lynch administers. That still falls short of the 12% to 15% rate recommended by experts, but more companies in the survey also are automatically stepping up employee contribution rates annually.

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