NBA, law firms, physician groups have most-generous 401(k) plans

Law firms, anesthesiologists and even the National Basketball Association are among the most generous employers when it comes to their 401(k) plans, according to investment research firm Brightscope.

Brightscope determined a company’s generosity by looking at the vesting schedule, eligibility periods and all contributions to the plan made by the company for the sole benefit of the plan’s participants.

Topping the list is law firm Sullivan & Cromwell LLP which, according to Brightscope’s database, is in the top 15% of plans for account balances, company generosity, participation rate and total plan cost.

The NBA, meanwhile, comes in at No. 29.

No publicly traded companies made the list — not because those companies aren’t generous but rather because they may offer benefits beyond the 401(k) plan to help employees prepare for retirement.

“Publicly traded companies will have stock options, stock grants and different programs beyond the 401(k) plan so they might not need to be as generous within the 401(k) plan,” says Brooks Herman, head of data and research at Brightscope. “If you look at a company like Google, they’ve got very good company generosity relative to their peer set [but] they’re nowhere close to this level of generosity these plans have…[However,] they’ve got a different structure, different liquidity, company stock and all kinds of programs that defer compensation to their employees, not just in the 401(k) plan.”

The average account balance for plans on the list is $470,014 — a giant leap when compared to the average account balance — $99,061 — of all plans within Brightscope’s database.

“To me that was just amazing, to think of an average account balance that big,” says Herman. “Generosity is a big driver of success for 401(k) savings. When companies are generous, people are going to be saving more, they’re going to be deferring more and it’s really going to drive up account balances.”