New Voya study examines impact of COVID-19 on higher education retirement plans

Perspectives on Higher Education

Higher education institutions today face many challenges related to their retirement plans. Not surprisingly, the COVID-19 pandemic has impacted the way higher education plan sponsors look at current and future retirement plan offerings, and how to educate their participants. The employer role has become more critical as faculty, administrators and staff increasingly look for help and trusted information from their employer.

Voya recently conducted a survey of retirement plans in public and private higher education. We surveyed higher education administrators and chief financial officers about key issues impacting the structure and management of their defined contribution retirement plans.

Our resulting white paper — Lessons learned on the management of higher education retirement plans in challenging times — delivers insights on current challenges that higher education institutions face in a COVID-19 world that has created a paradigm shift. We found that almost every aspect of how they manage their institutions has experienced a seismic shift, all while they try to help faculty, administrators and staff plan for the future they envision. You can see a quick snapshot of interesting findings and access the whitepaper here ( 

Let’s look at some of the key findings from the higher education study to help you identify your priorities and develop a strategy to optimize your retirement program and help your faculty, administrators and staff achieve the retirement they envision.

Key findings

  • 39% think their employees are “very prepared” for retirement
  • 87% think the COVID-19 pandemic will have a significant impact on their employees’ retirement readiness
  • 41% have already reduced or stopped their employer contribution as a result of COVID-19
  • 19% of plan sponsors report an average contribution rate of more than 6%
  • 51% want more help from providers with “improving the overall financial wellness of employee population”
  • 45% believe facilitating retirement planning for caregivers and employees with special needs and disabilities is very important
  • 40% offer automatic enrollment
  • 88% rely on the services of a plan advisor/consultant
  • 46% say “keeping up with regulatory changes” is a top challenge

5 Key takeaways

1. COVID-19 is having a widespread impact across higher education

The COVID-19 pandemic is having across-the-board impacts, and higher education institutions will be recovering from its effects for years to come. Needs and priorities are evolving and changing rapidly and advisors, plan sponsors and their participants are looking for support to guide and inform decisions.

  • The majority (87%) of higher education plan sponsors think the COVID-19 pandemic will have a significant impact on their employees’ retirement readiness, and more than half (53%) want providers to offer more help with retirement readiness. 
  • As a result of COVID-19, 41% have already reduced or stopped the employer contribution, and another 40% are considering reducing the employer contribution.
  • 66% of higher education institutions have or plan to reduce staff, and 58% have or plan to reduce hiring.

2. Expanding financial wellness offerings is a top priority

Financial wellness programs in higher education are becoming more comprehensive and inclusive. The majority (74%) of higher education institutions offer a financial wellness program with robust features that focus on planning for retirement, investing and budgeting. Plus, a majority of them plan to expand their programs to include assistance for caregivers and employees with special needs and disabilities, debt management, advisory support through one-on-one counseling or online tools and calculators.

  • 51% want help from providers with “improving the overall financial wellness of employee population.”
  • 53% plan to offer an “assistance with debt management” component as part of their financial wellness program in the next 3 years.
  • 42% say “the cost of the program” is a key challenge in offering a financial wellness program.

3. Opportunities exist to improve plan health through support offered by plan providers, consultants and advisors

With the majority of higher education plan sponsors using a single plan provider and continued consolidation expected among those with multiple providers, there is an opportunity for higher education institutions to lean on plan providers, consultants and advisors to help improve plan health. 

  • Among those currently using multiple plan providers, about six in ten say they are somewhat likely to reduce the number of providers.
  • More than eight in ten higher education sponsors are satisfied with plan provider effectiveness in helping their organization achieve retirement plan goals.
  • 88% of higher education institutions rely on the services of a plan advisor or consultant. About half of plan sponsors that currently rely on a plan advisor or consultant engage them to provide holistic financial planning and education to participants, as well as help with plan provider selection, transition and plan design support.

4. Fees, regulatory and fiduciary responsibilities are top concerns for sponsors

Keeping up with regulatory changes, motivating employees to save and helping them to invest wisely are considered to be the greatest challenges in managing retirement plans. Private institutions and larger institutions (5,000+ employees) are more challenged with meeting fiduciary responsibilities while smaller institutions (<500 employees) are more challenged by responding to regulatory and/or compliance requirements.

  • 46% of higher education sponsors say “keeping up with regulatory changes” is the top challenge in managing the retirement plan.
  • 42% of private higher education sponsors say “meeting fiduciary responsibilities” is a challenge in managing the plan.
  • 47% say it’s very important to prioritize “reducing plan fees and expenses” over the next two years.

5. Employee retirement readiness is a top measure of plan success

While participation rate has traditionally been the primary measure of plan health, retirement readiness of the employee population is generally the preferred plan success measurement used by higher education plan sponsors, especially for small and larger plans. For mid-sized plans (500-4,999), income replacement is the preferred plan success metric.

  • About four in ten higher education sponsors say motivating employees to save adequately and invest wisely are top challenges.
  • About four in ten higher education plan sponsors plan to add a guaranteed income option or an auto enroll feature to their retirement plan.
  • 53% of higher education plan sponsors want providers to offer participants more help with retirement readiness.

It’s time to benchmark your plan – and we can help

We would enjoy reviewing the results of this survey with you and helping you:

  • Benchmark your plan practices
  • Identify areas of opportunity for your plan
  • Consider new ideas such as plan design changes or adding new plan features such as managed accounts
  • Learn how financial wellness programs can help drive retirement readiness
  • Understand the impact of regulatory changes on your plan

A thorough investigation can lead to a breakthrough for your institution – measurable not only in plan outcomes but also in key business metrics such as employee retention, cost management and organizational growth.


Brodie Wood, SVP, National Practice Leader – Education Markets, Voya Financial

Brodie is responsible for developing and maintaining new and existing relationships with plan sponsors, intermediaries and consultants to support the broader strategic growth of the firm’s Tax-Exempt Markets business. He has more than 20 years of industry experience, with a broad knowledge of products, services, distribution channels and the competitive landscape – specifically within the 403(b) and 457 plan markets. Most recently, Wood served on the board of the American Hospital Association’s Institute for Diversity in Health Management.  He also is a part of the College and University Professional Association for Human Resources (CUPA) associate leadership program.  He earned his B.A. with a dual major in Spanish and Business from Utah State University. He has also completed his M.B.A. from Brigham Young University in 2002. He is a Six Sigma Green Belt and holds FINRA Series 26, 7, 63, and CRPC designations.

Registered representative of Voya Financial Advisors, Inc. (member SIPIC).


Contact your Voya representative today to benchmark your plan.




Findings based on the results of a Voya Financial survey conducted by Greenwald Research among 297 higher education plan sponsor retirement plan decision makers. The research was conducted July 22-September 11, 2020.

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