The 401(k) Access Gap in South Carolina: What Employers Can Do About It

For many South Carolina workers, preparing for retirement begins with a simple question: Does my employer give me a convenient way to save?

For hundreds of thousands of workers across the state, the answer is still no.

A 2025 report from the Georgetown University Center for Retirement Initiatives estimated that approximately 851,000 South Carolina private-sector employees, 47% of the state's private-sector workforce lacked access to an employer-sponsored retirement savings plan. The gap is particularly pronounced among smaller employers: Georgetown estimated that 63% of employees working for South Carolina businesses with fewer than 50 employees lacked workplace retirement-plan access, compared with 34% of employees at larger businesses.

The Pew Charitable Trusts reached a similar conclusion. In a July 2025 analysis, Pew estimated that 850,904 South Carolina workers, or 48% of the state's private-sector workforce, lacked access to a retirement savings plan through their jobs. Pew also estimated that inadequate retirement savings could result in nearly $7.3 billion in additional state spending through 2040 if current conditions persist.

Whether the figure is expressed as 47% or 48%, the message is difficult to miss: roughly half of South Carolina's private-sector workforce does not have access to retirement savings through the workplace.

For South Carolina employers, that is more than a retirement-policy statistic. It raises important questions about employee benefits, recruiting and retention, retirement readiness and whether an organization's existing retirement plan is accomplishing what it was designed to do.

For Employers Without a Retirement Plan: The Access Gap May Be an Opportunity

The retirement savings gap is especially relevant for small and midsized businesses.

Georgetown's research found that employees of smaller South Carolina businesses are substantially less likely to have access to a workplace retirement plan than employees of larger companies. That means an employer that chooses to establish a 401(k) or other qualified retirement plan may be offering something many workers in the state still do not have.

That can make the retirement plan part of a broader compensation and benefits strategy.

An employer-sponsored plan can provide employees with a systematic way to save directly from their paycheck while giving the employer flexibility to design a benefit around the needs of the organization and its workforce. Depending on the type and design of the plan, employers may consider features such as:

• Employer matching or profit-sharing contributions
• Traditional and Roth employee deferrals
• Automatic enrollment and automatic contribution increases
• Different eligibility and vesting provisions
• Safe harbor plan designs
• Investment options selected specifically for the plan
• Plan features intended to support both employee retirement readiness and the employer's broader benefits objectives

The right structure depends on the employer. A growing professional practice may have very different objectives from a manufacturer, nonprofit organization, family-owned business, or company competing aggressively for skilled employees.

That is why the first question should not necessarily be, "Which 401(k) provider should we use?"

A better starting point may be:

"What are we trying to accomplish by offering a retirement plan?"

The answer can help shape decisions about plan design, employer contributions, eligibility, investments, administration, payroll integration, participant education, and the various professionals needed to support the plan.

For Employers That Already Have a 401(k): Access Is Only the Beginning

South Carolina's retirement access gap naturally focuses attention on employers that do not offer plans. But there is another important side to the issue.

Having a retirement plan does not automatically mean the plan is working as effectively as it could.

For an employer that already sponsors a 401(k), the more useful questions may be:

• What percentage of eligible employees are participating?
• Are employees contributing at meaningful levels?
• How effectively is the employer contribution encouraging retirement savings?
• Does the plan design still fit the workforce and the company's objectives?
• Are the investment options being reviewed through a consistent fiduciary process?
• Is the plan's Investment Policy Statement current and being followed?
• Are plan fees and service arrangements reasonable for the services being provided?
• Are participants receiving useful, understandable education?
• Are the recordkeeper, third-party administrator, payroll provider, investment adviser, and other service providers working together effectively?
• Is the plan committee documenting its reviews and decisions?

Those questions move the conversation from "Do we have a 401(k)?" to "How well is our 401(k) working?"

That distinction matters.

A qualified retirement plan is both an employee benefit and an ongoing responsibility for the employer sponsoring it. Plan design, participant behavior, investment oversight, fees, service-provider relationships, and fiduciary documentation can all change over time.

An arrangement that made sense five or ten years ago may deserve another look as the company grows, its workforce changes, new plan features become available, or the retirement-plan marketplace evolves.

Periodic review can help a plan sponsor identify what is working well, what may need attention, and what should be prioritized next.

Retirement Access Is Also a Business Issue

Pew's South Carolina analysis looked beyond individual households.

According to Pew, inadequate retirement savings can affect state finances through lower household spending and increased demand for public assistance. Pew estimated that South Carolina could face nearly $7.3 billion in additional state spending through 2040 if retirement savings remain inadequate.

Georgetown's research similarly examines retirement access as a broader economic issue. Its 2025 study found that nearly half of U.S. private-sector employees lacked access to employer-sponsored retirement savings and examined how expanding workplace access—including through state-facilitated programs—could help close that gap. Georgetown also found evidence in early-adopter states that retirement-access initiatives can indirectly encourage employers to establish their own private retirement plans.

The takeaway for South Carolina businesses does not have to depend on any particular public-policy approach.

Employers themselves have an opportunity to be part of the solution.

For an organization without a retirement plan, that may mean exploring whether establishing one makes sense.

For an organization with an existing plan, it may mean evaluating whether the plan is delivering the value the company and its employees expect from it.

For CPAs, Attorneys, Benefits Professionals and Other Business Advisers

The retirement-access gap also creates an opportunity for professionals who advise South Carolina businesses.

CPAs, attorneys, benefits consultants, payroll professionals, bankers and other advisers are often involved when a company reaches an important transition point: hiring additional employees, revisiting compensation, changing payroll systems, adding benefits, planning for ownership succession, or evaluating expenses.

Those conversations can uncover retirement-plan questions.

A business owner may say:

"We've grown enough that I think we need to offer a 401(k)."

Another may ask:

"We already have a plan, but I don't really know whether it's competitive."

A CFO or HR leader may be frustrated with the company's current providers. A plan committee may realize its investment-review process has become inconsistent. An owner may simply want to know whether the company's retirement benefit still makes sense.

Those situations do not necessarily require the CPA, attorney, payroll company, or benefits professional to become a retirement-plan specialist.

They may simply signal that the client would benefit from bringing one into the conversation.

A qualified retirement-plan adviser should complement the work of the employer's other professionals—not blur the lines between investment advice, plan administration, recordkeeping, payroll, tax advice, and legal counsel.

Three Questions for South Carolina Employers

The research from Georgetown and Pew gives South Carolina employers a reason to consider retirement-plan access at the statewide level.

But the most useful next step is to bring the question closer to home.

1. If your company does not offer a retirement plan:

Would offering one strengthen your employee benefits while helping your employees and potentially your owners build retirement savings?

Before choosing a provider, consider what you want the plan to accomplish and what design best fits the business.

2. If your company already sponsors a 401(k):

When was the last time you evaluated the plan as a whole?

That means more than reviewing investment performance. Consider plan design, participation, fees, investments, fiduciary processes, participant education, provider service, and committee documentation.

3. If you advise South Carolina businesses:

Which of your clients may be approaching one of these decisions?

A retirement-plan conversation can be particularly valuable when a company is growing, revisiting its benefits, experiencing provider frustration, or simply has not evaluated its current plan in several years.

A Practical First Step

WebsterRogers Financial Advisors works with employers and retirement-plan committees to help make qualified retirement plans easier to oversee and easier for employees to understand.

For existing plans, WRFA can assist with areas including fiduciary investment oversight, Investment Policy Statement support, investment-menu review and monitoring, committee-ready reporting, participant education, fee and benchmark discussions, and coordination with recordkeepers and third-party administrators. Where engaged, WRFA can also serve as an ERISA §3(38) investment manager for the plan's investment menu.

A focused plan review can be a practical starting point. Reviewing items such as the current investment lineup, fee disclosures, Investment Policy Statement, plan document or Summary Plan Description, recent plan reports, and service-provider structure can help identify strengths, gaps, priorities, and next steps.

For employers that do not yet sponsor a plan, the conversation can begin even earlier: What are the company's objectives? What type of plan might fit the organization? Which responsibilities will belong to the employer, investment adviser, recordkeeper, third-party administrator, payroll provider, and other professionals?

South Carolina's retirement-access gap is significant. But for an individual employer, addressing it starts with a much smaller question:

What can we do for our employees and is our retirement benefit helping us accomplish it?

If your organization is considering establishing a qualified retirement plan, or if you would like a fresh look at an existing 401(k), the retirement services team at WebsterRogers Financial Advisors would welcome the opportunity to start the conversation.

Sources

Georgetown University Center for Retirement Initiatives.Who Lacks Access to Retirement Savings? A State-Level Analysis and an Examination of the Potential Benefits of State-Facilitated Retirement Savings Programs. Policy Report 25-01, March 2025.

The Pew Charitable Trusts. South Carolina Workplace Savings Program Would Help More Than 850,000 Workers Save for a More Secure Financial Future. July 2025.

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