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Auto Portability - Recent Developments
Find the most-recent auto portability media coverage and developments.
In response to the U.S. Department of Labor’s (DOL) Employee Benefits Security Administration’s (EBSA) recent approval of the RCH Auto Portability program, the American Benefits Council commended the agency for its efforts to address the problems of leakage and missing participants. It also suggested that the DOL extend RCH's portability exemption to pre-existing safe harbor IRAs. In a December 20th letter to the DOL, the Council voiced its support, noting that the proposed exemption “appears to include sufficient safeguards for participants, including an extensive set of notice requirements.”
In their online blog, CPA/Consulting firm Bowman & Company LLP analyzes the DOL's advancement of the RCH Auto Portability program -- including Advisory Opinion 2018-01A, and the proposed Prohibited Transaction Exemption. The article examines both actions, identifies the systemic benefits of cashout leakage, and notes a "bonus" for employers -- the increase in plan assets that could result in lower fees from plan service providers.
In his 12/17/18 article in 401kSpecialist, contributor Robert Lawton identifies healthcare savings as one of the biggest threats to a secure retirement, advocating for policies that support greater use of HSAs. In his analysis, Lawton also identifies auto portability and open MEPs as "good ideas to help address perceived deficiencies in existing 401(k) plans."
In his 12/17/18 opinion piece in The Daily Caller, Paris Dennard examines some of the Trump administration's economic policies toward black Americans, identifying the Labor Department's auto portability rule change as "allowing Americans, especially minorities, the ability to preserve their retirement savings when they change jobs."
RealClear Politics' Ian Schwartz covers the 12/12/18 White House event marking the establishment of the White House Opportunity and Revitalization Council, and focuses specifically on remarks made by the RLJ Companies founder and Retirement Clearinghouse majority owner Robert L. Johnson. In his remarks, Mr. Johnson thanks the administration for the Department of Labor's recent actions on Auto Portability, noting that the auto portability program could result in "close to $800 billion" in incremental retirement savings for minority Americans.
Fox News opinion journalist Laura Ingraham takes note of the RLJ Companies founder and RCH majority owner Robert L. Johnson's appearance at an event for the signing of an Executive Order, where Mr. Johnson commended the administration, the Department of Labor and Sen. Tim Scott (R-SC), for their support of auto portability. Ingraham quotes Mr. Johnson as stating that "(auto portability) will put back close to $800 billion back in the retirement pockets of minority Americans. So I just want to applaud you for that."
On 12/12/18, President Donald J. Trump signed an executive order establishing the White House Opportunity and Revitalization Council, intended to facilitate long-term equity investments in low-income communities designated as "qualified opportunity zones." Among the distinguished guests at the event was entrepreneur Robert L. Johnson, founder of the RLJ Companies and majority owner of Retirement Clearinghouse. Mr. Johnson took the opportunity to congratulate the administration and Sen. Tim Scott (R-SC) for their role in the Department of Labor's recent Advisory Opinion on auto portability, noting that auto portability will preserve $800 billion in minorities' retirement savings.
Video available on YouTube's White House channel here (queued to start at the President's introduction of Mr. Johnson)
Pensions & Investments' Washington reporter Brian Croce examines the RCH auto portability program, following the DOL's November guidance. Croce outlines key aspects of the RCH program, quoting noted Washington-based ERISA expert Michael P. Kreps, who states that a key outcome of the DOL's Advisory Opinion is to "provide plan sponsors with additional certainty that they're not taking on additional fiduciary responsibility or risk by selecting this product." Croce also quotes RCH CEO Spencer Williams, Boston College's Alicia Munnell and the American Benefits Council's Lynn Dudley.