Best practices for 403(b) plans in higher education
Fidelity suggests the following actions for higher education plan sponsors:
1. Target employee and employer contributions totaling 10 percent to 15 percent of an employee’s annual salary to increase retirement readiness.
2. Administer a combined benefits plan of contribution and employer match to increase total contributions, employee engagement, and potentially lower costs.
3. Use employer match to increase voluntary participation rates and employee contributions.
4. Consider automatic enrollment to raise voluntary plan participation rates.
5. Consider automatic increase program to increase employee voluntary contributions.