1. Workplace Solutions Analytics
06/30/2017
Workplace Solutions Analytics
Quarterly Trends Q2’17

2. Fidelity Investments: An industry leading retirement provider
Fidelity’s recordkept database is one of the industry’s most comprehensive proprietary collections of defined contribution plan and participant info.
Based on recordkept data of corporate defined contribution (DC) plans:
22,200 plans
15.0 million participants
Data as of June 30, 2017 unless otherwise noted*
KEY MESSAGE:
Fidelity’s recordkept database is one of the industry’s most comprehensive proprietary collection of defined contribution plan and participant information.
KEY POINTS:
The data in this presentation is based on:
Fidelity Investments recordkept data of corporate defined contribution (DC) plans which includes 22,200 plans, 15 million participants, and $1.5 trillion in assets.
Data excludes Phantom Non Qualified Plans (assets remain the property of the company or a trust) and all Tax Exempt Plans. Plans sponsored by Fidelity Investments for the benefit of its own employees are excluded.
Participants must have >$0 Real Assets.
Data as of June 30, 2017 unless otherwise noted.
* Data in this presentation exclude tax-exempt plans, nonqualified plans, and the FMR Co. plan. It includes data from the Fidelity Advisor 401(k) program.

3. Account Balance Key Insights
Currently, the average account balance is $97,700, an increase of 9.7% from one year prior
The median participant account balance is $24,100
Account balances are impacted by participant action (contributions, withdrawals, etc.) and market action
Account balances are also impacted by new participants having lower account balances than departing participants who may roll out their assets
KEY MESSAGE
Account balances increased 2.3% from Q1 2017, from $95,500 to $97,700
KEY POINTS:
The overall average account balance we traditionally report increased to $97,700, or 9.7%, from a year earlier. This is simply total assets / total participants.

4. Account Balance (10-Yr Continuous Active Participants)
Key Insights
The 10-Year Continuous Active Account Balance follows the same participants over time to show what they experienced during the last ten years
These participants had a $266,100 average account balance, up from $78,800 ten years prior (12.9% annual increase)
This account balance increase was 47% due to participant action (net contributions) and 53% due to market increases
KEY MESSAGE:
Continuous active participants saw over a $187K increase in account balances over the last decade.
KEY POINTS:
While the overall average account balance we traditionally report increased 19% in the last 12-months, actively employed participants present for the last 10-years experienced something very different. Over 10 years – almost a $187K increase (a 12.9% compound annual growth rate (CAGR)). Over 15 years, these participants experienced a $313K increase (a 14.8% CAGR).
This increase results from:
consistent employee and employer contributions,
dollar cost averaging, and
market action.
It’s a good reminder that actively contributing to a DC plan over time can make a difference.
Remember, dollar cost averaging does not ensure a profit or protect against loss in a declining market. For the strategy to be effective, you must continue to purchase shares in both up and down markets.
Continuous Active Participants are actively employed with a balance for each year endpoint during the 10-year period.

5. Deferral Rates Key Insights KEY MESSAGE: KEY POINTS:
Currently, the average employee deferral rate is 7.8%
Other than participant actions of increasing/decreasing deferrals (next slide), this figure is impacted by new participants joining the plan having lower deferral rates than departing participants leaving the plan
KEY MESSAGE:
Employer contributions play a large role in helping participants save for a secure retirement.
KEY POINTS:
Average Total Savings Rate is simply the sum of average employee deferral rate plus the average employer contribution rate.
Active Participants with >=0% Deferral Rates. Mean elective total deferral rates (point-in-time). Some figures may not add due to rounding.

6. Changes to Employee Deferral Rates
Key Insights
Overall, 8.8% of participants made an employee deferral increase in the prior 3-months
In plans that offer Auto-AIP, 11.3% of participants had employee deferral increases in the prior 3-months
The long-term trend of more employee deferral increases than decreases was interrupted during Q3’08 - Q1’09, but has resumed since (32 consecutive quarters)
Annual Increase Program (AIP) is a big driver of this trend, see “Deferral Increases due to AIP” slide
KEY MESSAGE
For the 32nd straight quarter, more participants increased (8.8%) their savings rate than decreased it (3.1%).
KEY POINTS
The trend of more participants increasing their savings rate than decreasing them has continued since Q
Continuous Active Participants Only (3-month). Mean elective total deferral rates (point-in-time).

7. Employee Deferral Increases due to AIP
Key Insights
Annual Increase Program (AIP) was responsible for 40.9% of deferral increases made in the prior quarter
AIP represented half (51.7%) of all deferral increases in prior 12-months (not graphed)
The seasonality is due to the majority of AIP increases occurring in Q1
KEY MESSAGE
AIP is a prime driver in helping participants achieve target savings amounts.
KEY POINTS
74.1% of qualified plans offer the Annual Increase Program.
16.3% of qualified plans utilize automatic Annual Increase Program.
25.8% of active participants in plans with AIP utilize the program.
42.7% of AIP active participants are auto-swept vs. 57.3% who are proactive
17.0% of participants not auto-swept into AIP proactively enrolled
Continuous Active Participants Only (3-month).

8. Auto Enrollment (AE) Impact to Participation Rate
Key Insights
Younger, less well-compensated employees benefit from Auto-Enrollment (AE)
The overall active participation rate is 70.6%, up from 64.2% nine years prior due to impact of AE
In plans who offer AE, the participation rate is 86.2%, which has also increased as more employees become eligible for AE within those plans
Further, those employees who are eligible for Auto-Enrollment in AE Plans have a participation rate of 85.7% (i.e % opt-out)
KEY MESSAGE
Plans utilizing Auto-Enrollment (AE) have significantly higher participation rates.
KEY POINTS:
AE helps those who need it most…..young participants and those in lower salary ranges.
49.5% of AE plans auto enroll all eligible employees; 50.5% auto enroll new/recent hires only.
51.2% of AE plans utilize automatic AIP.
Plan sponsors may want to consider automatically enrolling participants beginning at a rate of 6% and using AIP to increase deferrals 1% annually up to at least 15%.
Data as of 12/31/ Active Eligible Employees Only.

9. Asset Allocation Key Insights
Changes in asset allocation can be driven by market fluctuations, as well as by exchange, contribution, and withdrawal activity
Equity = Domestic Equity, International Equity, Company Stock, Specialty, Self-Directed Brokerage
Blended = Target Date Funds, Target Risk Funds, Balanced Funds
Conservative = Short-Term, Stable Value, Fixed Income, Annuity
KEY MESSAGE:
Percent of assets in Blended funds has increased over time mostly due the adoption of Target Date Funds.
KEY POINTS:
Conservative Options: stable value, fixed income, and short-term investment options.
Blended: target date, target risk, balanced, and strategy investment options.
Equities (excl Co. Stock): domestic equity, international equity, specialty, and self directed brokerage investment options.

10. 100% or 0% Equity Allocation
Key Insights
For many participants, equity allocation was an “all-or-nothing” decision
Mainly through the increased use of Target Date Funds, fewer participants now hold such extreme portfolios
About one-in-nine participants (11.1%) hold 100% or 0% equity allocations
KEY MESSAGE
Fewer participants now hold extreme portfolios compared to 10 years ago.
KEY POINTS
7.8% of participants hold 100% of their plan assets in equities, while 3.4% of participants hold none of their plan assets in equities. The percentage of participants holding extreme positions continues to decline.
As of June 30, 2017, the average equity exposure of our participant base is 75%, ranging from 89% for those in their early 20s to 54% for those aged 70+.
For the first time, we see about the same percentage of women and men holding 100% of their assets in equity (9.7% of women v. 9.3% of men.)

11. Target Date Fund Adoption
Key Insights
About half of total participants (46.9%) holds 100% of their assets in Target Date Funds
For Millennials, this figure is 66.7%
This trend has been chiefly driven by the use of Target Date Fund (TDF) Default
Default options have a sizeable impact on aggregate participant behavior
KEY MESSAGE:
Adoption of Target Date funds has risen dramatically since the adoption of the Pension Protection Act (PPA).
KEY POINTS:
88.1% of plans use a lifecycle option as the default, corresponding to 94% of our recordkeeping participant base. Note that lifecycle options are a subset of blended options.
Half of our youngest investors hold 100% of their assets in a target date fund. This is driven by the use of TDFs as the default investment option associated with Auto-Enrollment.
Millennials were born between 1981–1997.

12. Personal Rate of Return (PRR) *
Key Insights
The median cumulative participant 1-year personal rate of return (PRR) is 15.8%
The median cumulative participant 3-year personal rate of return (PRR) is 18.4% (5.8% annualized)
The median cumulative participant 5-year personal rate of return (PRR) is 60.8% (10.0% annualized)
The median cumulative participant 10-year personal rate of return (PRR) is 63.1% (5.0% annualized)
KEY MESSAGE
This slide provides Personal Rate of Return (PRR) data over the past 12-months.
Personal Rate of Return (PRR) is a measure of portfolio performance that indicates the return earned over a given time period. Personal rate of return used in our analyses (unless otherwise noted) is time weighted, which means it was calculated by subtracting beginning market value from ending market value and dividing by beginning market value for each sub-period. A new sub-period began each time there was cash flow. The sub-period returns were then geometrically linked together to calculate the return for the entire period. All returns shown are historical and include change in share value and reinvestment of dividends and capital gains, if any. Risk is defined as the volatility of historical portfolio returns; it measures the average deviation of a series of historical returns from its mean. Large values of risk indicate large volatility in the historical return series, and small values indicate low volatility.
* See Important Additional Information for more details.

13. Personal Rate of Return (PRR) *
10-Year Participant Performance vs. Applicable Fidelity Freedom Fund®
10-Year Risk*
Lower
Higher
Higher
29.0%
34.8%
63.8%
of Participants
of Participants
of Participants
10-Year Return
24.0%
12.2%
Lower
36.2%
of Participants
of Participants
of Participants
53.0%
47.0%
of Participants
of Participants
Key Insights
Balanced portfolios such as the Fidelity Freedom Funds® outperformed 36.2% of participants over the 10-year return period
Also, 47.0% of participants took on more risk. Of those with higher risk, 26.0% underperformed against their age-based Freedom Fund (12.2% / 47.0%)
During the 10-year return period, the median participant cumulative return was 63.1% (or 5.0% annualized)
KEY MESSAGE
This slide provides Personal Rate of Return (PRR) data over the past 10-years.
Personal Rate of Return (PRR) is a measure of portfolio performance that indicates the return earned over a given time period. Personal rate of return used in our analyses (unless otherwise noted) is time weighted, which means it was calculated by subtracting beginning market value from ending market value and dividing by beginning market value for each sub-period. A new sub-period began each time there was cash flow. The sub-period returns were then geometrically linked together to calculate the return for the entire period. All returns shown are historical and include change in share value and reinvestment of dividends and capital gains, if any. Risk is defined as the volatility of historical portfolio returns; it measures the average deviation of a series of historical returns from its mean. Large values of risk indicate large volatility in the historical return series, and small values indicate low volatility.
* See Important Additional Information for more details.

14. Contribution Allocation
Key Insights
Changes in contribution allocation are driven by participant behavior, whereas asset allocation is heavily impacted by market movement
Equity = Domestic Equity, International Equity, Company Stock, Specialty, Self-Directed Brokerage (SDB)
Blended = Target Date Funds, Target Risk Funds, Balanced Funds
Conservative = Short-Term, Stable Value, Fixed Income, Annuity
KEY MESSAGE:
Dramatic Shift in Contribution Allocation – Smaller portion of contribution dollars directed to equities.
KEY POINTS:
As of December 31, 2005, only 16% of all new contributions were directed to blended options such as target-date funds. Today, this number is 50%.
Much of this shift can be attributed to plan sponsor adoption of target-date or lifecycle default, as 88.1% of all plan sponsors now utilize these options as the plan default investment option.
Over the past ten years, participants have shifted to a more balanced contribution allocation.
Active Participants Only.

15. Employee Contributions
Key Insights
In the prior 12-months, 88.9% of active participants made employee contributions, up from 82.9% ten years prior
Also, 87.0% of active participants received employer contributions in the prior 12-month period (not graphed)
Overall, 95.2% of active participants made contributions (employee, employer, or roll-in) in the prior 12-month period (not graphed)
KEY MESSAGE:
Employee contributions have recovered from the decline seen during the economic downturn.
KEY POINTS:
The average employee contribution amount was $6,580 during the past 12 months, up $260 from a year ago.
80.8% of participants have made/received both employee contributions (excluding rollovers in) AND employer contributions in the last year.
Active Participants Only.

16. Average Contribution Amounts
Key Insights
The average 12-month employee contribution was $6,580, up from $5,200 ten years prior (per participant making >$0 employee contributions)
This represents a 2.4% annual increase in employee contribution amounts
The average 12-month employer contribution was $3,790, up from $2,700 ten years prior (per participant receiving >$0 employer contributions)
This represents a 3.4% annual increase in employer contribution amounts
KEY MESSAGE:
Employee and Employer contributions continue to inch up.
KEY POINTS:
Contributions include employee deferrals, company contributions (match/profit sharing) and roll over dollars.
Active Participants Only.

17. Plan Design Key Insights KEY MESSAGE: KEY POINTS:
Plans offering Auto-Enrollment (AE) has increased to 31.8% of plans, representing 67.8% of the participant base
Plans offering Roth Deferrals has increased to 61.7% of plans, representing 78.7% of the participant base
Also, 74.1% of plans offer Annual Increase Program (AIP) and 16.3% of plans offer Auto-AIP (not graphed)
Also, 88.1% of plans have Target Date Fund (TDF) Default, up from 75.7% five years prior (not graphed)
KEY MESSAGE:
Plan design that encourages good savings behaviors and offers participants flexibility have increased adoption rates.
KEY POINTS:
Auto-Enrollment adoption is as high as 71% in large plans (>10,000 participants) and 15% in our very small plans (<100 participants.)
The participant opt-out rate for Auto-Enrollment does not increase with higher plan level default deferral rates. (16% opt-out at 3% default, 14% opt-out at 6% default rate.)
Auto-Enrolling participants at 6% combined with a 1% annual increase up to at least 15% can help participants reach target savings rates.
Use of Roth deferrals is highest among our youngest participants, those under age 30.
Participants who defer to Roth save, on average, more than non-Roth contributors. Average employee deferrals for Roth contributors is 9% versus the 7% average for pre-tax deferrals.
Of plans that offer Roth contributions, 14% offer the option for an in-plan conversion of existing assets to Roth dollars.

18. Loans Outstanding Key Insights
The percent of active participants with a loan outstanding is 20.9%
The percent of active participants initiating a loan in the prior 12-months is 9.8%
KEY MESSAGE:
Participants should consider the impact of a loan on their retirement saving goals.
KEY POINTS:
9.8% of active participants initiated a loan during the 12-month period ending June 30, 2017, the same as the 12-month period ending June 30, 2016.
The average initial loan amount taken during the past 12 months was $9,660.
Loan usage is highest among participants aged
Active Participants Only.

19. Hardship Withdrawals Key Insights
While hardship withdrawals (HWs) continue to increase, they represent a very small portion of active participants
The percent of active participants taking a hardship withdrawal was 2.2% in the prior 12-months
In order to take a hardship withdrawal, you have to prove a financial need
Examples of reasons for HWs: 1) foreclosure, 2) tuition, 3) purchase of primary residence, 4) medical expenses
KEY MESSAGE
Very few participants utilize hardships. Usage increased following the financial crisis of and has remained relatively stable over the past several years.
KEY POINTS
The average hardship withdrawal amount per participant taking a hardship over the past 12 months was $5,730.
A significant portion of participants taking hardship withdrawals are repeat users
Active Participants Only.

20. Exchanges Key Insights
In the prior 12-months, 10.4% of participants made an exchange
One reason for this long-term decline is the continued adoption of Target Date Funds (TDF)
Only 1.1% of participants who held 100% of assets in TDFs made an exchange in the prior 12-months
See Target Date Fund Adoption slide for more
KEY MESSAGE:
The percent of participants making exchanges has declined since the market downturn in 2008/2009.
KEY POINTS:
Of those participants making exchanges during the past 12 months, 63% made only one exchange, 18% made only two exchanges, and 19% made three or more exchanges.

21. Participant Demographics
Key Insights
The median age for participants was 45.1, up from 44.6 ten years prior
The median tenure for active participants is 6.3 years, while the mean tenure is 9.8 years
The median income for active participants is $70,200, while the mean income is $98,500
Plans: 22,200
Participants: 15M
Recordkept Assets:: $1.5 trillion
Note: The set of plans and participants used to make the calculations for the figures in this document represent the “Building Futures” set of plans and participants and exclude the Fidelity employee plans, NQ plans, and some other very minor differences from our total recordkeeping data.

22. Important Additional Information
Before investing in any mutual fund, please carefully consider the investment objectives, risks, charges, and expenses. For this and other information, call or write Fidelity for a free prospectus or, if available, a summary prospectus. Read it carefully before you invest.
As with all your investments through Fidelity, you must make your own determination whether an investment in any particular security or securities is consistent with your investment objectives, risk tolerance, financial situation and your evaluation of the security.
Dollar cost averaging does not ensure a profit or protect against loss in a declining market. For the strategy to be effective, you must continue to purchase shares in both up and down markets.
Personal Rate of Return (PRR): A measure of portfolio performance that indicates the return earned over a given time period. Personal rate of return used in our analyses (unless otherwise noted) is time weighted, which means it was calculated by subtracting beginning market value from ending market value and dividing by beginning market value for each sub-period. A new sub-period began each time there was cash flow. The sub-period returns were then geometrically linked together to calculate the return for the entire period. All returns shown are historical and include change in share value and reinvestment of dividends and capital gains, if any. Risk is defined as the volatility of historical portfolio returns; it measures the average deviation of a series of historical returns from its mean. Large values of risk indicate large volatility in the historical return series, and small values indicate low volatility.
Stock markets, especially foreign markets, are volatile and can decline significantly in response to adverse issuer, political, regulatory, market, or economic developments.
Keep in mind investing involves risk. The value of your investment will fluctuate over time and you may gain or lose money.
Past performance is no guarantee of future results.

23. Important Additional Information
Unless otherwise disclosed to you, any investment recommendation in this document is not meant to be impartial investment advice or advice in a fiduciary capacity. Fidelity and its representatives have a financial interest in any investment alternatives or transactions described in this document. Fidelity receives compensation from Fidelity funds and products, certain third-party funds and products, and certain investment services. Fidelity may also receive compensation for services that are necessary to effect or execute transactions with respect to investment alternatives (such as trading commissions). The compensation that is received, either directly or indirectly, by Fidelity may vary based on such funds, products and services, which can create a conflict of interest for Fidelity and its representatives.
Fidelity Freedom Funds® are designed for investors expecting to retire around the year indicated in each fund's name. Except for the Freedom Income Fund the funds' asset allocation strategy becomes increasingly conservative as it approaches the target date and beyond. Ultimately, they are expected to merge with the Freedom Income Fund. The investment risk of each Fidelity Freedom Fund changes over time as its asset allocation changes. These risks are subject to the asset allocation decisions of the Investment Adviser. Pursuant to the Adviser's ability to use an active asset allocation strategy, investors may be subject to a different risk profile compared to the fund's neutral asset allocation strategy shown in its glide path. The funds are subject to the volatility of the financial markets, including that of equity and fixed income investments in the U.S. and abroad, and may be subject to risks associated with investing in high-yield, small-cap, commodity-linked, and foreign securities. No target date fund is considered a complete retirement program and there is no guarantee any single fund will provide sufficient retirement income at or through retirement. Principal invested is not guaranteed at any time, including at or after the funds' target dates.
For plan sponsor and investment professional use only. Approved for use in 401(k) market and Advisor. Firm review may apply.
Fidelity Brokerage Services LLC, Member NYSE, SIPC, 900 Salem Street, Smithfield, RI 02917
Fidelity Investments Institutional Services Company, Inc., 500 Salem Street, Smithfield, RI 02917