Amid COVID-19, more employers are easing access to 401(k) assets than cutting matching contributions

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[{"type":"text","content":"Willis Towers Watson survey also reveals companies are boosting financial wellbeing initiatives\nARLINGTON, Va., May 04, 2020 (GLOBE NEWSWIRE) -- A majority of U.S. companies are making it easier for employees to access their 401(k) plans’ assets even as some companies are cutting matching contributions amid the COVID-19 pandemic. These findings are according to the latest pulse survey by Willis Towers Watson (NASDAQ: WLTW), a leading global advisory, broking and solutions company. The survey also revealed companies are increasing their emphasis on financial wellbeing resources to help workers cope during the crisis.\n Many employers are making adjustments to their 401(k) plans as a result of the CARES Act, the law designed to help protect American workers from the economic impact of COVID-19. Almost two-thirds of respondents (65%) increased access to in-service distributions from participants’ 401(k) accounts while 16% either plan to or are considering doing so this year. Nearly as many (64%) are now allowing participants to defer loan repayments while 48% increased the maximum amount available for plan loans. Another 17% are planning or considering making either adjustment this year. “These are difficult times emotionally and financially for many employees,” said Robyn Credico, North America Defined Contribution practice leader, Willis Towers Watson. “Making cash available from defined contribution plans is an easy, relatively inexpensive way to provide much needed assistance to employees. This comes at a time when some organizations are having to reduce their own spending on retirement benefits. The more distressed companies cut contributions to their plans in an effort to reduce costs, similar to what we saw during the financial crisis of 2008.” Just 12% of employers suspended their matching contributions, but 23% are either planning to or considering doing so this year. Interestingly, significantly more companies in hard-hit industries, including retail and business services, made cost-cutting changes. One-quarter of these companies (26%) suspended their matching contributions; nearly a third (32%) either will or may do so this year. Recognizing that the economy may be hitting their employees hard, one-third of survey respondents (33%) cited supporting their employees’ financial wellbeing as one of their top three benefit p...

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