Employers face retirement readiness in DC plans

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 the 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 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.”

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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.

Organizations have more data than ever, but many still manage retirement programs through broad aggregate metrics. Segmented analytics and AI-enabled insights offer opportunities to identify participants who need support most. Four in five sponsors are willing to leverage AI for data analytics and monitoring.

The survey shows that the opportunity is no longer simply improving retirement plans—it’s improving retirement outcomes. Employers that clearly define success, use data to guide decisions and support employees throughout their retirement journey will be better positioned to enhance employee experience, strengthen workforce outcomes and maximize the value of their retirement programs.