Supplemental Plan Offerings and Retirement Saving Choices: An Analysis of North Carolina School Districts

Abstract

Unlike private sector employers, public school districts generally offer more than one type of supplemental retirement savings plan and allow multiple vendors to offer products. Using individual-level payroll data from over half of the public school districts in North Carolina coupled with data from an employer survey, this study examines the impact of inter-district differences in supplemental plan administration on participation in these savings vehicles. We find wide variation in total participation rates and in 403(b) plan participation rates in particular, even among this population of public-sector workers with the same defined benefit pension plan, health plan, and retiree health coverage. Individual and district characteristics explain some, but not all, of the variation observed.

Supplemental plan offerings and retirement saving choices: an analysis of North Carolina school districts

“…In Clark et al . (2015), a comparison with the TSERS actuarial report in 2013 finds that the distribution of tenure is roughly consistent with the aggregate statistics provided by the retirement system. Thus, we believe that tenure is measured reasonably well in our data.…”

“… 31 These results should be interpreted with some caution since, as Clark et al . (2015) describe in detail, salary is understated in our data. Many districts provide a local salary supplement, which may be paid monthly, annually, or in two installments with the payment frequency and month of payment differing among districts.…”

“…The survey asked for information on all retirement saving plans offered by each district, the management and oversight of these plans and vendors, as well as for information about any employer-provided communications and other informational efforts related to retirement plans 6 . See Clark et al (2015) for detailed information about the data.…”

Informing Retirement Savings Decisions: A Field Experiment on Supplemental Plans

“…Clark, Pelletier, and Pathak () and Clark et al. () explore how plan differences affect choices between 401(k) and 457 plans.…”

Nudging Retirement Savings: A Field Experiment on Supplemental Plans

“…Clark, Pathak, and Pelletier (2017) andClark, Hanson, Morrill, and Pathak (2016) explore how plan differences affect choices between 401(k) and 457 plans.4 These contribution limits have been increased so in 2017, participants can contribute up to $18,000 annual with catch-up contributions of $6,000 allowed for employees over age 50.…”