WTW 2026 Defined Contribution Survey: Employers face a retirement readiness gap, and pressure is mounting to prove plans work

Rhea-AI Summary

WTW (NASDAQ: WTW) released its 2026 Defined Contribution Survey of 547 U.S. plan sponsors, highlighting a “retirement outcomes gap” between employer expectations and actual participant readiness. While 60% of sponsors define retirement readiness (via income replacement, on-time retirement or confidence), many still rely on aggregate metrics that obscure risks for specific employee groups.

Employers rank retirement savings as a high priority and aim to enhance employee experience (69%) and improve retirement outcomes (63%), yet plan design, governance and support at the point of retirement often lag these goals. One in five sponsors are considering delegating administration and fiduciary duties to focus more on strategy, and 3 in 10 plan to introduce in-plan retirement income solutions. According to WTW, nearly 4 in 5 sponsors are willing to use AI for plan analytics, with lower willingness where fiduciary accountability is higher, and the survey outlines four data- and AI-enabled steps to close the retirement outcomes gap.

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3 in 4 employers rank retirement savings as a high priority, while 4 in 5 are willing to use AI for plan analytics and monitoring

NEW YORK, Aug. 03, 2026 (GLOBE NEWSWIRE) -- U.S. employers are facing a clear retirement readiness challenge: they value defined contribution (DC) plans, but many still lack a precise view of whether those plans are helping employees retire on time and with confidence. That is according to the WTW 2026 Defined Contribution Survey from WTW (NASDAQ: WTW), a leading global advisory, broking and solutions company. In the survey of 547 U.S. plan sponsors, 60% have a working definition of retirement readiness, split among income replacement (40%), retiring on time (39%) and retirement confidence (39%) (sponsors could select more than one option).

The finding underscores what WTW calls a retirement outcomes gap, now a growing business concern for employers. Employers are asking their DC plans to deliver more than ever: enhancing the employee experience (69%) and improving retirement outcomes (63%) top their objectives for the next two years, and three in four rank retirement savings as a core or top priority within total rewards. But many plans are still measured, governed and delivered for a different era, leaving a gap between what employers expect and what their plans are built to achieve. Sponsors are reassessing governance, resources and plan design to move beyond commitment to impact.

“The retirement outcomes gap is a call to action,” said Chris West, Senior Managing Director and Defined Contribution Strategy Leader, WTW. “Employers have invested heavily in retirement programs, but the next challenge is proving these programs are moving employees closer to retirement readiness. Advanced analytics can help sponsors see where gaps are emerging and what actions may matter most, leading to more impactful solutions and better outcomes.”

The survey shows where plans stall, and where employers are starting to act:

• Averages hide the people at risk. Sponsors often monitor aggregate, plan-level metrics such as participation rates, but fewer break results down by employee group, where gaps in access, savings behavior and outcomes are often most visible.
• Plan design is being retooled for impact. Half of sponsors say minor or moderate retirement plan design updates are needed. As cost pressures persist, employers are looking for changes that make plans more relevant, flexible and aligned with retirement readiness goals.
• Plan governance continues to evolve. Closing the retirement outcomes gap will require many sponsors to rebalance time and resources spent on administration and governance. One in five sponsors are looking to delegate future delivery support, transferring administration and fiduciary responsibilities so their teams can spend more time on strategy focused on improving participant outcomes.
• Support stops before the finish line. Plans have gotten better at helping employees accumulate savings, but support diminishes when it matters most: the transition into retirement, when workers face critical decisions about their readiness and the prospective distribution and investment options that determine whether savings become sustainable income. To enhance support, 3 out of 10 sponsors are planning to offer an in-plan retirement income solution.
  
  

The stakes extend beyond the benefits department. When employees do not feel ready to retire, they often do not, whatever their account balance says, and delayed retirements ripple into workforce planning, succession and talent costs. Employers in the survey consistently tie their retirement objectives to broader workforce goals, including attraction, retention and timely workforce transitions.

The retirement outcomes gap has new urgency as workers are increasingly confronted with large, abstract retirement savings targets. For many Americans, the workplace DC plan is their primary retirement vehicle, which puts employers at the center of translating those headline numbers into something a worker can act on.

“Headlines keep telling workers they need a specific amount of retirement savings. Even retirement professionals struggle to say what the numbers mean until they are translated into a monthly lifestyle,” said Dave Amendola, Managing Director and Intellectual Capital and Innovation Leader, Defined Contribution Strategy, WTW. “That is the gap employers are wrestling with: helping employees understand what their savings actually mean and supporting confident decisions that help convert an account balance into retirement income.”

Employers also see AI as part of the answer, in certain areas. Nearly four in five (79%) are willing to use artificial intelligence (AI) for plan analytics, 73% to automate routine processes and 72% to personalize employee communications. Willingness wanes as stakes rise: 37% for compliance and risk management, 33% for recordkeeper oversight and 29% for fiduciary governance, with data privacy and security the most common reservation (74%). The pattern reflects where accountability sits: sponsors are more comfortable when AI provides education, as opposed to when it touches fiduciary responsibilities.

“Employers are most comfortable using AI where it can make retirement programs more responsive, efficient and insight driven,” West said. “The opportunity is to use these tools to better engage participants, streamline administration and help sponsors understand where plan design, investment strategy and participant support can have the greatest impact.”

The survey suggests four steps for closing the retirement outcomes gap: define retirement readiness in measurable terms, use enhanced plan data and AI-enabled analytics to identify where support is needed, shift time and resources from administration toward outcomes, and extend more personalized support through the transition into retirement.

The complete findings are available in the WTW 2026 Defined Contribution Survey report.

About the survey

The WTW 2026 Defined Contribution Survey is based on responses from 547 U.S. employers that sponsor a defined contribution plan. Fieldwork was conducted between April 15 and May 22, 2026. Respondents skew large: over 60% hold at least $1 billion in DC plan assets, 42% have 10,000 or more employees, and 72% also manage a defined benefit plan.

About WTW

At WTW (NASDAQ: WTW), we provide data-driven, insight-led solutions in the areas of people, risk and capital. Leveraging the global view and local expertise of our colleagues serving 140 countries and markets, we help organizations sharpen their strategy, enhance organizational resilience, motivate their workforce and maximize performance. Working shoulder to shoulder with our clients, we uncover opportunities for sustainable success, and provide perspective that moves you. Learn more at wtwco.com.

Media contact

Dan Mahoney, Pierpont, Dmahoney@piercom.com, 970.405.8060

Arnelle Sullivan, WTW, Arnelle.Sullivan@wtwco.com

FAQ

What is the main finding of the 2026 WTW Defined Contribution Survey about retirement readiness?

The survey identifies a significant “retirement outcomes gap” between employer expectations and actual participant readiness. According to WTW, many plans prioritize outcomes but still use aggregate metrics and legacy designs, masking at-risk groups and limiting progress toward measurable retirement readiness goals.

How many U.S. employers participated in the 2026 WTW Defined Contribution Survey on DC plans (WTW)?

The survey collected responses from 547 U.S. defined contribution plan sponsors. According to WTW, these sponsors reported strong focus on retirement savings, but many acknowledged needing plan design updates, improved governance and more targeted analytics to better track and improve retirement readiness.

How are employers planning to use AI in retirement plans according to WTW’s 2026 survey (WTW)?

Employers are largely open to AI for plan analytics, automation and personalized communications. According to WTW, 79% are willing to use AI for analytics, but willingness drops for compliance, recordkeeper oversight and fiduciary governance due to concerns about data privacy, security and accountability.

What changes to plan design and governance are WTW 2026 survey respondents considering for DC plans?

Many sponsors see a need for minor or moderate plan design updates to better align with retirement readiness goals. According to WTW, one in five sponsors may delegate administration and fiduciary responsibilities, freeing internal resources to focus more on strategy and participant outcomes.

What does the WTW 2026 survey say about in-plan retirement income solutions in DC plans (WTW)?

The survey reports that 3 out of 10 sponsors plan to offer an in-plan retirement income solution. According to WTW, employers recognize support often declines at retirement, and these solutions aim to help convert savings into sustainable retirement income for participants.

How do employers link retirement objectives to broader workforce goals in the WTW 2026 DC survey?

Employers connect retirement outcomes with workforce planning, succession and talent costs. According to WTW, delayed retirements driven by low readiness can affect attraction, retention and timely transitions, making effective defined contribution plans a strategic workforce management tool beyond traditional benefits considerations.