Findings show many have not adapted to a pension landscape that has significantly evolved over the last decade

The report, “Spending and Saving Behavior of Public Sector Defined Contribution Plan Participants,” provides analysis and graphic representation of the spending and saving behavior of nearly 37,000 households with public sector defined contribution (DC) plan participants obtained from the PRRL Database and JPMorgan Chase Bank, NA.

Additional key findings contained in the report are:

  • Households with a primary defined benefit (DB) plan spend more than households with a hybrid or primary DC plan.
  • Public sector households are, at the median, spending at or above their net income.
  • Savings rates in DC plans are correlated with the type of primary employer-sponsored plan (e.g., defined benefit, defined contribution, or hybrid).
  • Households with employees with a primary employer-sponsored DB plan are less likely to contribute to a DC plan.
  • The presence or absence of Social Security coverage appears not to have an impact on spending behavior.

The data on which the analysis was conducted was taken from the PRRL Database and JPMorgan Chase Bank, NA. The PRRL Database contains public sector defined benefit participant and plan data from nearly 200 457(b), 401(a), 403(b), 401(k) and other defined contribution plans, including nearly 2.3 million state, county, city, and subdivision government employees. The data from JPMorgan Chase Bank, NA includes a comprehensive view of total household spending through various payment mechanisms and sources of income for approximately 22 million households (as of 2019).

“Spending and Saving Behavior of Public Sector Defined Contribution Plan Participants” may be accessed here.