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AB News New AllianceBernstein Research Shows Majority of Eligible Employees Avoid Actively Managing Their 401(k) Plan

NEW YORK--(BUSINESS WIRE)--The majority of 401(k) eligible employees admit they are unprepared or reluctant to review, manage and monitor their retirement plan investments, AllianceBernstein announced today. More than half of the 1,000 American workers polled by AllianceBernstein, or 61 percent, say they are “Accidental” investors, meaning they lack confidence in their ability to manage their investments, don’t enjoy the process and often give minimal attention to their retirement accounts.

“As Defined Contribution plans quickly replace Defined Benefit plans as the primary retirement savings account for most corporate employees in the United States, a logical assumption would be that employees are ready to accept control of their retirement investments,” said Dick Davies, Senior Managing Director, head of Institutional Defined Contribution Services at AllianceBernstein. “The high number of Accidental investors illustrated in this research shows us that is not the case.”

According to the research, nearly half of all Accidental investors review their investments no more than once a year – or not at all (32 percent)! For those who do monitor their investments, the retirement plan statement is the primary source of information; half of all Accidental investors also rely on this document as their primary source of information. When considering all 401(k) eligible investors, the Internet is the second most important resource for retirement plan valuation (33 percent). Surprisingly, given the availability of mutual fund NAV’s in newspapers, that medium ranked last (3 percent) in helping participants determine the value of their retirement investments.

In a recent overhaul of retirement plans, Congress directly addressed plan design issues and enacted measures to foster increased participation in 401(k) plans among eligible employees.

Davies commented, “The recent passage of the Pension Protection Act of 2006 encourages the automation of many aspects of DC plans including: enrollment, default investments, contribution rate escalation – as well as mandating the frequency and content of participant statements. All of these provisions are directly on point to improving the retirement security of many Americans. Rather than fight employee inertia, the lesson learned over the past 25 years of the 401(k) experience is to harness it.”

All workers who participated in this study were 18 years or older and are full-time employees at companies offering 401(k) plans.

About AllianceBernstein

AllianceBernstein L.P. ("AllianceBernstein") is a leading global investment management firm providing investment management services for many of the largest U.S. public and private employee benefit plans, foundations, public employee retirement funds, pension funds, endowments, banks, insurance companies and high-net-worth individuals worldwide. AllianceBernstein is also one of the largest mutual fund sponsors, with a diverse family of globally distributed mutual fund portfolios. Through its subsidiary, Sanford C. Bernstein & Co., LLC, AllianceBernstein provides in-depth research, portfolio strategy and trade execution to the institutional investment community.

At September 30, 2006, AllianceBernstein Holding L.P. ("Holding") owned approximately 32.8% of the issued and outstanding AllianceBernstein Units. AXA Financial was the beneficial owner of approximately 60.1% of the AllianceBernstein Units at September 30, 2006 (including those held indirectly through its ownership of approximately 1.7% of the issued and outstanding Holding Units) which, including the general partnership interests in AllianceBernstein and Holding, represent an approximate 60.5% economic interest in AllianceBernstein. AXA Financial is a wholly-owned subsidiary of AXA, one of the largest global financial services organizations.