How often must a defined contribution plan with direct investments provide benefit statements?

A defined contribution plan with direct investments must provide benefit statements at least once per quarter. This requirement ensures that participants receive timely and relevant information about their account balances and investment performance, allowing them to make informed decisions about their retirement investments. Quarterly statements typically include information such as contributions made, investment changes, benefits accrued, and performance of designated investments.

This frequent reporting is deemed important because it helps participants manage their retirement savings actively, especially in a defined contribution plan where individuals are responsible for making investment choices. While annual statements are also provided, they do not give participants enough timely information to effectively monitor and adjust their investment strategies. In the case of defined benefit plans, the reporting frequency may differ, but for defined contribution plans featuring direct investments, quarterly statements are the standard to ensure participants stay engaged with their retirement plans.