Trends in Nonqualified Deferred Compensation plans

Want more information about our key findings?

View our Plan Sponsor (PDF) and Participant (PDF) infographics for additional details, as well as slides showing the Research Summary (PDF).

As a leader in the nonqualified deferred compensation (NQDC) market, we know these plans are effective for plan sponsors and participants alike – and we do our homework to prove it. Browse the information to understand how these benefits help employers meet organizational goals while helping key employees address their financial needs.

Top findings from the 2014 research

It’s about retiring and retaining top talent. The 2014 study continues to highlight these as employers’ most important reasons for offering a nonqualified deferred compensation plan. 

It’s about retirement readiness and NQDC plays a key role. 82 percent of participants consider their NQDC plan most important in reaching their retirement goals. And 30 percent of participants plan to increase their NQDC plan contributions in the next year.

On average, participants expect 20 percent of their retirement income will come from the NQDC plan. In fact, nearly a quarter of the participants estimate it will represent 25 percent or more of their retirement income.

It’s about resources…and room for change. Investment performance information is the resource employers find most valuable to help key employees make decisions about their plan benefits.  And expanding the number of eligible participants is the most likely upcoming plan change.

Deferral decisions are driven by key issues. The primary factors among participants in deciding a deferral amount include progress towards savings goals, performance of plan investment options, overall investment portfolio and estimated salary and/or bonus changes.

Get the full report on latest trends

Read the latest research from The Principal that spotlights participants' and plan sponsor experiences with nonqualified deferred compensation plans.