Ubiquity’s 2023 State of the Industry Survey

  • Inflation, recession, and poor investment returns are top concerns across all cohorts for 2023
  • All cohorts believe the Fed will raise rates twice in 2023
  • Widely differing opinions on where inflation will end in 2023
  • Crypto is the least-preferred retirement asset class

In the fourth quarter of 2022, Ubiquity Retirement + Savings polled over 1,100 401(k) plan participants, plan sponsors, financial advisors, and solo entrepreneurs to take the pulse on their concerns about retirement planning as related to the economy and the state of their businesses. We also wanted a window into their predictions for 2023. The responses we received were somewhat surprising.

While many respondents showed similar concerns, there were also some disparities. The economy was a worry due to the volatility of macroeconomic forces like inflation and recession, and the resulting impacts on the stock markets and investment performance. However, respondents revealed that these fears did not move them to change their retirement planning strategies much, if at all.

Combined Data: Plan Participants, Plan Sponsors, Financial Advisors, and Solo Entrepreneurs Top Concerns for 2023

    


Press Releases:
Ubiquity Retirement + Savings “State of the Industry” Survey Reveals Top Concerns for Retirement Plan Decision Makers in 2023

401(k) Plan Participants Rank Crypto Dead Last as Preferred Retirement Saving Asset


As related to impact on 401(k) plans, when able to choose multiple answers:

  • Nearly 60% of plan participants and financial advisors agree that inflation is their overall business concern for 2023.
  • Approximately 60% of plan sponsors and solo entrepreneurs agree that recession is their biggest concern in 2023.

Nearly all groups felt somewhat prepared for inflation, recession, and poor investment returns:

  • 69.8% of solo entrepreneurs
  • 56.4% of advisors
  • 54.9% of plan sponsors
  • 38.9% of plan participants

Inflation impact & 2023 inflation expectations

Respondents had mixed feelings on the impact that inflation, recession, and poor investment returns will have on their business in 2023.

  • Plan participants and plan sponsors had the highest expectations of no impact (35.8% and 38.3% respectively)
  • Advisors and solo entrepreneurs expected somewhat negative impacts at 33.7% and 55.8% respectively

Wide divergence on where inflation will end up in 2023

Financial advisors (56.4%) and solo entrepreneurs (43.9%) expect inflation to decrease by the end of 2023 compared to where it was in Q4 2022.

Plan sponsors expect inflation to increase by the end of 2023 versus Q4 2022 (57.3%).

Interest rate increase expectations

Plan sponsors, financial advisors, and solo entrepreneurs all expect the Federal Reserve will raise rates two times in 2023.

Saving for retirement & 401(k) behaviors

57.7% of 401(k) plan participants currently think they are not saving enough for retirement. Solo entrepreneurs’ (35.7%) top concern about retirement is saving enough money ahead of retirement.

Despite worries about inflation, recession, poor investment returns, and not saving enough for retirement, no group is expecting a change in behavior when it comes to

  • Increasing or decreasing 401(k) contributions – no change
  • Taking more or less risk in their 401(k) – no change
  • Taking out a 401(k) loan – no change

No interest in crypto in 401(k) plans

Plan participants rank crypto dead last as their preferred option for saving for retirement

(Respondents could select up to 3)

  • 401(k): 84.3%
  • Other stock or bond investments: 40.8%
  • Savings account: 36.8%
  • Real estate: 33.2%
  • Checking account: 15.7%
  • Other asset: 11.1%
  • Gold: 7.3%
  • Crypto: 3.5%

Why clients choose Ubiquity Retirement + Savings

Across the board, plan sponsors, financial advisors and solo entrepreneurs choose Ubiquity for our low flat fees¹ and simple pricing. Plan sponsors love us for our outstanding customer service, which is ranked #1 on Google Reviews, Trustpilot, and the Better Business Bureau.²

Nearly 90% of plan sponsors report that offering a Ubiquity 401(k) is helpful in attracting and retaining talent.

Over 1,100 plan participants, plan sponsors, financial advisors, and solo entrepreneurs were surveyed in Q4 2022. Survey question answers were randomized and responders were anonymized for confidentiality.

Plan Participants

Responses collected from plan participants implied that they are feeling overall less confident about their financial futures and are worried that they won’t have enough money to retire or that their money will run out during retirement. 58.7% of respondents feel they have average or lower financial literacy, which presents an opportunity to support them with education.


Press Release:
Plan Participants and Solopreneurs Focus on the Impacts of a Possible Recession, Inflation, and Low Investment Returns for 401(k)s in 2023


Plan participants’ overall top concerns for 2023 that could impact their 401(k)

(Respondents could pick more than one)

  • Inflation: 54.8%
  • Recession: 50.2%
  • Poor investment returns: 48.7%

How prepared their company is for these concerns

How prepared do you feel your company is to face the challenges noted above?

  • Somewhat prepared: 38.9%
  • Very prepared: 24.5%
  • Neither unprepared nor prepared: 21.6%

How do you expect these challenges will impact your company in 2023?

  • No impact: 35.8%
  • Somewhat negatively: 32%
  • Somewhat positively: 17.3%
  • Very positively: 9.6%
  • Very negatively: 5.3%

Zero interest from plan participants in crypto for their 401(k)

Plan participants rank crypto dead last option for saving for retirement when asked “What is your preferred retirement savings option?”

(Respondents could select up to 3)

  • 401(k): 84.3%
  • Other stock or bond investments: 40.8%
  • Savings account: 36.8%
  • Real estate: 33.2%
  • Checking account: 15.7%
  • Other asset: 11.1%
  • Gold: 7.3%
  • Crypto: 3.5%

Saving for Retirement & 401(k) Behaviors

Plan participants don’t expect to change their 401(k) behavior in 2023.

  • 69.2% expect to make no change in their 401(k) contributions
  • 91.8% expect to not take out a 401(k) loan in 2023 despite fears of a recession
  • 74.3% expect to make little or no change to the amount of risk they are willing to accept in their investments in 2023 despite fears of poor investment returns

Plan Participants’ Top Retirement Concern is Saving Enough Money Ahead of Retirement

  • Saving enough money ahead of retirement: 34.2%
  • Running out of money during retirement: 25.8%
  • Maintaining my lifestyle: 15.7%
  • Leaving a financial legacy for my family: 7.1%
  • Covering medical expenses: 6.4%
  • Other: 5.9%
  • Long-term care expenses: 4.9%

Majority of Plan Participants Don’t Think they are Saving Enough for Retirement

  • 57.7% don’t think they’re saving enough for retirement
  • 42.3% think they are

Plan Participant Perceived Financial Literacy

Plan participants think they have average financial literacy.

  • 43.2% average financial literacy
  • 25.1% high financial literacy
  • 16.2% very high financial literacy
  • 12.8% low financial literacy
  • 2.7% very low financial literacy

Plan Sponsors

    

Plan Sponsors generally feel ready to face macroeconomic challenges to their 401(k) plans, and most aren’t anticipating a negative impact on their business because of these challenges. Overwhelmingly, plan sponsors feel strongly that offering a Ubiquity 401(k) to their employees is a cost-effective way to attract and retain talent.


Press Release:
Ubiquity Retirement + Savings “State of the Industry” Survey Reveals Vastly Different Inflation Expectations Among Plan Sponsors and Financial Advisors in 2023


Overall top 3 concerns plan sponsors have for 2023 that could impact performance of their plan participants’ 401(k) accounts

(Respondents could pick more than 1)

  • Recession: 61.9%
  • Inflation: 57.2%
  • Poor investment returns: 56.1%

How prepared do plan sponsors feel their business is to face the challenges noted above?

  • Somewhat prepared: 54.9%
  • Very prepared: 30.6%
  • Neither unprepared nor prepared: 18.9%

How do plan sponsors expect these challenges to impact their business in 2023?

  • No impact: 38.3%
  • Somewhat negatively: 37.1%
  • Somewhat positively: 14%
  • Very positively: 6%

Plan sponsor 2023 inflation & federal reserve interest rate hike expectations

By a wide margin, plan sponsors expect inflation to INCREASE by the end of 2023 compared to where it was in Q4 2022.

  • 57.3% increase in inflation
  • 20.2% decrease in inflation
  • 22.5% inflation will be the same at the end of 2023 as it is in Q4 2022

Plan sponsors expect two interest rate hikes from the federal reserve in 2023

  • 2: 36%
  • 3: 16.4%
  • 1: 13.3%
  • 4+: 10.1%
  • 0: 2%

Saving for retirement & 401(k) behaviors

Plan sponsors don’t expect participants to change their behaviors when it comes to managing their 401(k) accounts in 2023.

  • 70.3% expect no change in their clients 401(k) contributions
  • 52.9% expect no change in clients taking our 401(k) loans despite fears of a recession
  • 50.6% expect no change in clients changing their risk appetite in anticipation of poor future returns

Usefulness of Ubiquity 401(k) in recruiting & retaining employees

  • Nearly 90% of plan sponsors report offering a Ubiquity 401(k) plan helps them attract and retain employees

Why plan sponsors choose Ubiquity Retirement + Savings

  • Plan sponsors choose Ubiquity because of our low costs, flat fee¹ pricing, and how we are the best fit for their company’s savings needs.

Financial Advisors

Financial advisors, even more strongly than plan sponsors, feel prepared to take on economic hurdles like inflation, poor investment returns, and recession. Being able to offer a Ubiquity 401(k) plan to clients is a valuable way for them to attract new clients, and they choose Ubiquity plans because the costs are low and the platform is easy to use.


Press Release:
Ubiquity Retirement + Savings “State of the Industry” Survey Reveals Vastly Different Inflation Expectations Among Plan Sponsors and Financial Advisors in 2023


Overall top concerns financial advisors have that could impact the performance of their clients’ 401(k) plans in 2023

(Respondents could pick more than 1)

  • Inflation: 59.4%
  • Poor investment returns: 58.4%
  • Recession: 57.4%

Do you feel your advisory practice is prepared to face the challenges noted above?

  • Somewhat prepared: 56.4%
  • Very prepared: 37.6%

How do you expect these challenges to impact your business in 2023?

  • Somewhat negatively: 33.7%
  • No impact: 28.7%
  • Somewhat positively: 23.8%
  • Very positively: 12.9%

Financial advisors 2023 inflation and interest rate hike expectations

The vast majority of financial advisors expect inflation to decrease by the end of 2023 compared to where it was in Q4 2022.

  • 56.4% decrease in inflation
  • 27.7% increase in inflation
  • 15.8% inflation will be the same at the end of 2023 as it is in Q4 2022

Financial advisors expect two interest rate hikes from the Federal Reserve in 2023.

  • 2: 40.6%
  • 3: 21.8%
  • 1: 19.8%
  • 0: 8.9%
  • 4+: 4%

Saving for Retirement & 401(k) Behaviors

Financial advisors don’t expect clients to change their behaviors when it comes to managing their 401(k) plans

  • 72% expect no change in their clients 401(k) contributions
  • 63% expect no change in clients taking out 401(k) loans despite fears of a recession
  • 58% expect no change in clients changing their risk appetite in anticipation of poor future returns

Why financial advisors choose Ubiquity Retirement + Savings

Over 82% of financial advisors report being able to have a 401(k) offering from Ubiquity helps them attract and retain their clients.

Financial advisors choose Ubiquity because of our low costs and flat fee¹ pricing and how easy our platform is to use.

Solo Entrepreneurs

Perhaps the most confident group about their financial literacy, solo entrepreneurs are also quite prepared to handle business challenges in 2023. Most of these respondents are making no changes to their retirement contributions, but of those who are, most are not decreasing their risk tolerance. Ubiquity is a favored 401(k) provider to this group because of plan flexibility and options, as well as low pricing.


Press Release:
Plan Participants and Solopreneurs Focus on the Impacts of a Possible Recession, Inflation, and Low Investment Returns for 401(k)s in 2023


Overall top 3 concerns solo entrepreneurs have about 2023 that could impact performance of their 401(k) plan

(Respondents could pick more than 1)

  • Recession: 58.1%
  • Inflation: 58.1%
  • Poor investment returns: 55.8%

How prepared do solo entrepreneurs feel their business is to face the challenges noted above

  • 69.8% Somewhat prepared
  • 16.3% Very prepared
  • 9.3% Neither unprepared nor prepared
  • 4.7% Somewhat unprepared

How do solo entrepreneurs expect these challenges will impact their business in 2023

  • Somewhat negatively: 55.8%
  • No impact: 30.2%
  • Somewhat positively: 11.6%
  • Very positively: 2.3%

Solo entrepreneurs 2023 inflation & interest rate hike expectations

Vast majority of solo entrepreneurs expect inflation to DECREASE by the end of 2023 compared to where it was in Q4 2022

  • 43.9% decrease in inflation
  • 34.1% increase in inflation
  • 22.0% inflation will be the same at the end of 2023 as it is in Q4 2022

Solo entrepreneurs expect 2 interest rate hikes from the Federal Reserve in 2023

  • 2: 36.6%
  • 3: 22%
  • 1: 9.8%
  • 0: 4.9%
  • 4+: 2.4%
  • No opinion: 24.3%

Solo entrepreneurs’ top concern about retirement is saving enough money ahead of retirement:

  • Saving enough money ahead of retirement: 35.7%
  • Maintaining my lifestyle: 28.6%
  • Leaving a financial legacy for my family: 14.3%
  • Running out of money during retirement: 11.9%
  • Long-term care expenses: 4.8%
  • Covering medical expenses: 2.4%
  • Other: 2.3%

69% of solo entrepreneurs rate themselves as high or very high when it comes to financial literacy:

  • 35.7% very high
  • 33.3% high
  • 26.2% average
  • 4.9% low

Saving for retirement & 401(k) behaviors

Solo entrepreneurs don’t expect to change their behaviors when it comes to managing their 401(k) plans in 2023

  • 60% will make little or no change to their 401(k) contributions
  • 52.5% will not take out 401(k) loans
  • 52.5% will not change their overall risk appetite and of those who are, 35% are decreasing their risk appetite in 2023

Why solo entrepreneurs choose Ubiquity Retirement + Savings

  • Solo entrepreneurs choose Ubiquity because of our low costs and flat fee¹ pricing as well as the depth and breadth of our product offering.

Over 1,100 plan participants, plan sponsors, financial advisors and solo entrepreneurs were surveyed in Q4 2022. Survey question answers were randomized and responses were anonymized for confidentiality.

¹Flat fees are charged by Decimal, Inc. for recordkeeping and administrative services. Third-party service providers may assess asset-based fees to customers. Plan Sponsors are advised to review all service agreements with providers (e.g., investment advisors, custodians, broker-dealers) to evaluate total plan costs.
²An evaluation has been conducted by Decimal, Inc. through its research of independent customer reviews on Google, Trustpilot, and the Better Business Bureau as reported by unaffiliated contributors on or before September 30, 2022, for four similar small-business 401(k) providers in the marketplace.

© 2023 Ubiquity Retirement + Savings
Privacy Policy
Do not sell my info
44 Montgomery Street, Suite 3060
San Francisco, CA 94104
Support: 855.401.4357

Facebook Twitter LinkedIn YouTube

© 2023 Ubiquity Retirement + Savings
Privacy Policy
Do not sell my info
44 Montgomery Street, Suite 3060
San Francisco, CA 94104
Support: 855.401.4357

Credit Card Logos
Show Exit Modal