401(k) Loan Activity Trends

NAPA Net’s May report indicates that 401(k) participants were slightly less likely to have outstanding loans for year-end 2014 than for 2013.

Between 1996 and 2008, less than one-fifth of participants with access to loans actually had loans outstanding. That amount went up to 21% by year-end 2009 and remained steady through 2013 before falling to 20% by year-end 2014. Loan amounts, however, edged up from $7,421 in 2013 to $7,780 by y/e 2014, based on a report from the Employee Benefit Research Institute (EBRI) and the Investment Company Institute (ICI).

The majority of participants had no outstanding loans at all:

Small plans -- 500 or fewer participants -- had loan ratios of 13% of remaining assets, while plans with over 5,000 participants carried a loan ratio of only 11% (outstanding loans compared with total 401(k) balance).

Participant loan mistakes are common. Our Consultants at QBI can help with taking corrective action should such an event occur.

IRS Announces 2017 Plan Contribution and Benefit Limits

On October 27, 2016, the Internal Revenue Service announced cost-of-living adjustments affecting...

Read more

NAPA Reports Millennials May Be Hard for Advisors to Reach

A recent study by Hearts & Wallets Money Movement revealed a large hidden number of households...

Read more

Financial Wellness Factors

The “Financial Finesse Year in Review: 2015” concluded that employees who have...

Read more