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August 16, 2002

Dear Senator/Representative,

In an effort to gauge the needs of retirement investors, the Stable Value Investment Association (SVIA) recently conducted a survey of 800 Americans with money invested in employer sponsored retirement plans. The Conservative Investments Survey found that, despite prolonged volatility in the financial markets, most 401(k) investors go it alone, relying primarily on themselves and the information provided by their employer or savings plan provider in making investment decisions.

Established in 1990, SVIA is a non-profit organization dedicated to educating the public on the importance of saving and investing for retirement. Its membership represents every segment of the stable value investment community, including plan sponsor companies, insurance companies, banks, investment managers, and consultants.

SVIA's Survey, covering 500 workers who participate in their employer retirement savings/401(k) plan and 300 retirees who have a balance of at least $5,000 in their former 401(k) plans, finds that 52% of all retirees and almost half of all active workers (48%) rely on their own judgment and investment knowledge when it comes to making retirement investment decisions.

When asked, however, what is the most important source for making retirement investment decisions, 83% of workers and 69% of retirees say advice from professional financial advisors or retirement planners. Dependence upon these assets for retirement income and the current uncertainty in the financial markets motivates investors to make sure they are "doing the right thing" when it comes to retirement investment. Professional retirement advisors and planners can provide reassurance during these rocky times. SVIA supports Congressional efforts to allow for the provision of investment advice to defined contribution plan investors by plan administrators.

Fifty-three percent of workers say they rely most on information provided by an employer or the savings plan provider in determining where to invest retirement savings, yet only 12% of retirees rely on this source. Retirees say they turn to financial advisers (51%), newspapers and magazines (24%), family and friends (17%), and asset allocation models (7%) for retirement advice. American workers rely less on financial advisers (44%) compared to retirees and more on other sources for retirement investment information: 32% newspapers and magazines, 26% family and friends, and 12% on asset allocation models.

Attached is a brief summary on investors' attitudes and use of advice in 401(k) investing. As previously mentioned, SVIA supports efforts in Congress to allow for the provision of investment advice to 401(k) participants, particularly as passed in H.R. 3762, the "Pension Security Act of 2002."

We look forward to working with you on this important issue.

Sincerely,

Gina Mitchell
President