What Retirement Plan Features Do Employees Really Want? Pairing Employee Preference with Plan Sponsor Cost

Overview

The Society of Actuaries (SOA) Research Institute previously published a research paper on what retirement plan features employees prefer. Based on online survey findings of U.S. adults conducted in 2022, the original report provided insight into the features of retirement plans that are important to employees, and where they may make trade-offs for the features they find most important.

This new 2026 report presents findings from supplemental analysis that layers on the estimated cost to provide certain retirement plan features that were tested in the original research. This study helps to better understand a plan sponsor’s cost impact relative to employee preferences.

These findings help identify the most cost-effective ways to impact employee preference through changes in retirement plan design.

Key Findings

The research looks at retirement plan features and baseline scenarios. It explores the plan benefits for a surviving spouse or family beneficiary, risk tolerance, insights on accessing retirement benefits, and considerations with retirement funding options. Key findings include:

• Respondents are generally worried about the unknown and have strong preferences towards benefits that provide additional levels of certainty.
• Survivor benefits offer strong value. Respondents demonstrate strong preference for the ability to leave behind retirement benefits for a surviving spouse or partner.
• Inflation protection is popular but expensive. Respondents are worried about cost-of-living increases to their retirement benefits, and the high cost of such a benefit to a plan sponsor would make this one of the least cost-effective benefits tested.
• Access age matters. Respondents value certainty in their retirement benefits. Respondents are highly concerned with the age at which they are able to access their full unreduced retirement benefits. This research implies that permitting full benefits at age 65 could represent the best value in the trade-off between employer costs and employee preferences. For example, age 65 offers the strongest trade-off between sponsor cost and employee preference.
• Cost sharing saves sponsors money but reduces appeal. The report findings indicate that respondents don’t like the idea of sharing the cost of retirement benefits, and the idea creates a strong negative sentiment.

Podcast

What Retirement Plan Features Do Employees Really Want? (Part 2): Pairing Employee Preference with Plan Sponsor Cost

Acknowledgements

The researchers’ deepest gratitude goes to those without whose efforts this project could not have come to fruition: the Project Oversight Group for their diligent work overseeing, reviewing and editing this report for accuracy and relevance.

Project Oversight Group members:

• Lee Gold, ASA, EA, MAAA, Chair
• Carol Bogosian, ASA
• David Cantor, ASA, EA
• Anna Rappaport, FSA, MAAA
• Andrea Sellars, FSA, MAAA
• Lisa Ullman, FSA, EA, FCA, MAAA

At the Society of Actuaries Research Institute:

• Barbara Scott, SOA Sr. Research Administrator
• Steven Siegel, ASA, MAAA, SOA Sr. Research Actuary

The authors acknowledge the contributions of Saurabh Kumar and Krittika Godia and thank them both for their valuable research support.