What Others are Saying about Automatic 401(k)

"Auto enroll is taking off like gangbusters… Businesses…had been concerned that employees would be up in arms if someone automatically took money out of their paycheck, but that's not happening. Instead, many workers recognize they needed the extra nudge to get them to save."
-Wall Street Journal, Jillian Mincer, July 11, 2007

"Automatically enrolling all employees circumvents status quo bias—but not, it’s important to note, by usurping choice. Employees are free to opt-out if they don’t want to participate. Once enrolled, however, status quo bias works for—not against—the goal of bigger nest eggs, because saving a part of each paycheck becomes the new norm, helping to ensure that workers stick with savings programs."
-New York Times, Teresa Tritch, February 14, 2007

"Studies have found, however, that if firms change the presentation of the plan from an "opt-in" choice to an "opt-out" choice, in which workers are automatically enrolled unless they actively choose to remain out of the plan, participation rates increase substantially."
-Ben S. Bernanke, Chairman, Board of Governors, Federal Reserve System At the Fifth Regional Issues Conference of the Fifteenth Congressional District of Texas, Washington, D.C., June 13, 2006

"Not only do the best plans automatically enroll new employees, but also they use lifecycle funds as the default investment option…What’s so great about all this? Automatic enrollment pushes folks to participate. Once enrolled, inertia kicks in and employees tend to continue saving."
-Wall Street Journal, Jonathan Clements, January 21, 2007

"… the biggest mistakes employees typically make in saving for retirement are starting too late, saving too little, and investing too conservatively. An automatic 401(k) can solve those problems."
-LA Times, Kathy Kristof, July 22, 2007

"Saving for retirement is about to get a whole lot simpler—so simple, in fact, that in the near future, about the only thing you’ll have to do to keep your retirement saving on track is show up for work."
-Kiplinger.com, Mary Beth Franklin, February 2007

"Low-income workers would see their retirement income from their 401(k)s grow by 130 percent relative to what they would have had if they weren’t auto enrolled. Middle-income workers would see a jump of between 35 percent and 67 percent."
-CNN Money.com, Jeanne Sahadi, September 17, 2007