Public Policy

What’s on Tap for the Next Retirement Plan Policy Bill?

Andrew Remo, the American Retirement Association's (ARA) Director of Federal & State Legislative Affairs, summarizes the ARA's positions on key legislative matters following SECURE 2.0, and contemplates future, "new bipartisan proposals for consideration in the next round of retirement plan policymaking." While Remo addresses multiple legislative initiatives, he identifies Roth IRA rollovers as ARA's top priority. Because workers are currently prohibited from rolling Roth IRA savings into a workplace-based retirement savings plan, Remo believes that legislation removing this limitation could lead to more-effective operation of auto portability, which would facilitate automatic consolidation of these Roth IRA balances into a current-employer's workplace plan, while minimizing duplicative fees.

Also featured in ASPPA Net

401(k) Real Talk Episode 85: November 15, 2023

Fred Barstein, founder and CEO of The Retirement Adviser University, anchors his ongoing Wealth Management RPA Edge / 401(k) Real Talk video series, and discusses the 11/7/23 launch of auto portability services via the Portability Services Network (PSN). In his comments, Barstein notes the greater, longer-term potential of the PSN network to facilitate portability and to promote financial wellness, stating: “the initial launch, facilitated by the Retirement Clearinghouse is a great beginning – not just for the Portability Services Network, but for the entire DC industry.” Barstein’s commentary on PSN begins at the 3:00 mark.

LTPT and Auto-Portability Regs Coming Soon, Officials Reiterate

Writing in ASPPA Net, John Iekel covers the Nov. 6 session of the Society for SPARK Forum, where officials from the IRS and the DOL weighed in on their near-term regulatory agenda. In a panel that included DOL Principal Deputy Assistant Secretary Ali Khawar, the topic of auto portability was addressed. Iekel quotes Khawar as stating that auto portability is “an important part of the puzzle” and that "and that the DOL will be issuing guidance that will provide more clarity on what the statutory text says." Iekel adds that "Khawar’s comments were similar to those articulated Oct. 24 at the ASPPA Annual Conference...by Assistant Secretary of Labor Lisa Gomez."

How to Close the Racial Savings Gap with BET Founder Bob Johnson: DC Pension Geeks

Robert L. Johnson, founder of RLJ Companies and BET, joins American Retirement Association (ARA) CEO Brian Graff for a fascinating discussion about auto portability, financial wellness, closing the savings gap, and much more. Graff hosts Johnson for the ARA's DC Pension Geeks podcast -- featured in NAPA Net -- and spends 33 minutes with the legendary entrepreneur in a thoughtful discussion that focuses on minority wealth initiatives that Johnson has been both advocating for and actively pursuing for years, such as retirement savings auto portability.

Enhancing Financial Security for the Long Term

SHRM's Stephen Miller writes about the "technological breakthroughs, red-tape-cutting legislation and new initiatives from service providers" driving big changes for defined contribution plans that will "provide larger nest eggs for employees' retirement years." Miller identifies auto portability -- as delivered by the Portability Services Network -- as one of his four "megatrends" that will bring about dramatic changes. In the piece, Miller offers readers a primer on the key factors driving auto portability and turns to RCH EVP Neal Ringquist and Alight Solutions' Alison Borland for their views on the adoption of the emerging financial technology.

Industry-led auto-portability network ready

Pensions & Investments Washington reporter Brian Croce covers the official October 2023 "go live" date for auto portability, via the industry-led Portability Services Network, and presents a uniformly positive view of the industry network, as well as the go-forward prospects for auto portability. Croce includes extensive quotes from key representatives of the consortium, including Fidelity's Dave Gray, Alight's Greg Long, Vanguard's Steve Holman, as well as RCH's Spencer Williams and Neal Ringquist. Croce also turns to industry voices, including PSCA's Executive Director Will Hansen and EBRI's Craig Copeland.

Safeguarding Retirement Savings: Inside Secure Act 2.0 Key Priorities

BDO Alliance USA, among the industry’s largest associations of accounting and professional service firms, evaluates key priorities contained within recent SECURE 2.0 legislation, and includes an analysis of Section 120 of the act, which addresses auto portability. The piece notes that the auto portability "provision enhances portability by allowing the plan sponsor to now transfer the former employee’s default IRA assets (established at termination) into the participant’s new employer’s plan. The provision both curtails asset leakage from ERISA plans and helps alleviates the missing participant issue." The article also notes a related provision of the legislation -- Section 304 -- that increases the dollar limit for plan sponsors to automatically cash out a former employee’s retirement plan from $5,000 to $7,000, starting in 2024.

Leveraging SECURE 2.0 to Earn More 401(k) Business

Writing in NAPA Net, 401(k) Marketing's founder & CMO Rebecca Hourihan offers tips to plan advisors on how they can leverage awareness of SECURE 2.0 provisions to update plan fiduciaries and earn more 401(k) business. Hourihan focuses on components of SECURE 2.0 that deal with small account balances, including an increase to allowable safe harbor IRA balances and auto portability, as delivered by "a network of recordkeepers." Hourihan suggests that advisors "discuss the benefits of adding....auto-portability to plans now" and comes down firmly on the side of plan-to-plan consolidation, counseling advisors "to help employees consolidate accounts and encourage more assets into the plan" by incorporating "strong calls-to-action during enrollment and education meetings."