Menu
- News
- Press Releases
- Thought Leadership
- Consolidation Corner
- 401k Consolidation
- Auto Enrollment
- Auto Portability
- Automatic Rollovers
- Cashout Leakage
- Cybersecurity
- DEI, ESG & Social Responsibility
- ERISA Advisory Council
- Lifetime Plan Participation
- Managed Portability
- Missing Participants
- Mandatory Distributions
- Mobile Workforce
- Plan Termination
- Portability Services Network
- Public Policy
- Retirement Income
- Retirement Plan Portability
- Retirement Research
- Roll-In
- Safe Harbor IRA
- Uncashed Checks
- Events
Safe harbor IRA blog posts
Bringing Sunlight to the Dark Corners of Safe Harbor IRA Fees
Safe harbor IRAs exist due to the success of 401(k) plans, combined with the propensity of America’s mobile workforce to change jobs. While safe harbor IRAs have helped plan sponsors mitigate their cost and risk associated with small accounts, they’ve failed miserably for former participants. In his latest article in RCH’s Consolidation Corner, Tom Hawkins focuses sunlight on the unsavory practice of excessive safe harbor IRA fees, and offers advice to plan sponsors for promoting greater fee transparency and disclosure.
Broadcast Retirement Network Features Segment on ‘Small Account Problem’
On Wednesday, 11/4/20 the Broadcast Retirement Network’s Jeff Snyder interviewed Retirement Clearinghouse (RCH) President & CEO Spencer Williams and Alight Solutions’ Vice President & Head of Research Rob Austin to address the 401(k) system’s small account problem – where high levels of cashout leakage in small balance segments perennially robs millions of participants of a timely or comfortable retirement.
Safe-Harbor IRAs are Supposed to be Temporary
Writing in RCH's Consolidation Corner blog, RCH President & CEO Spencer Williams observes that safe-harbor IRAs -- created by the EGTRRA-mandated automatic rollover process -- were never intended to be "permanent retirement savings vehicles." Too often, argues Williams, the relief plan sponsors realize from automatic rollovers comes at the expense of participant outcomes -- who experience high levels of cashouts, low investment returns and savings-depleting fees. With the advent of auto portability, participants will spend less time in a safe harbor IRA, and "plan sponsors no longer have to consider trading participant outcomes for administrative convenience."
The Auto Portability Imperative
In the fifth installment of his five-part series on 401(k) cashout leakage, RCH's Tom Hawkins addresses auto portability, a solution that not only makes sound business sense, but delivers a positive societal impact for the corporations adopting it. Citing the recent Statement of Purpose from members of the Business Roundtable, Hawkins believes that as these socially-conscious corporations examine auto portability, they’ll quickly become convinced that auto portability is both a sound business decision, as well as the right thing to do.
The Most Promising Policies to Reduce 401(k) Cashout Leakage
In his five-part series in Consolidation Corner, RCH's Tom Hawkins sheds light on the problem of cashout leakage, a silent crisis that unnecessarily robs millions of Americans of their retirement security. In his fourth article in the series, Hawkins addresses policies with the most promise to reduce the 401(k) cashout leakage problem.
The Safe-Harbor IRA: Friend or Foe?
In his latest Consolidation Corner
blog post, RCH President & CEO Spencer Williams draws much-needed attention
to the downside of traditional safe harbor IRAs. While plans can benefit by
practices that remove small-balance accounts, Williams argues that this benefit
may be illusory, as former plan participants will likely cash out or become
“stuck” with multiple accounts that deplete their savings – both scenarios that
could expose sponsors to potential liability. Auto portability, says
Williams, can reverse this dysfunctional dynamic, achieving better outcomes for
plans and participants alike.
A Plan Metric Every Sponsor Should Track: Participant-Retained Retirement Savings
In his latest article in Consolidation Corner, RCH President & CEO Spencer Williams advises retirement plan sponsors to consider tracking the average percentage of retirement savings that participants retain during their tenure. Auto portability, says Williams, can enable participants to preserve their small-balance savings through job changes. Going further, Williams encourages plan sponsors and consultants to apply the all-important “participant-retained savings” lens when evaluating automatic rollover programs, including metrics such as cash-out rates, median safe harbor IRA account duration and provider support for consolidation.
How Auto Portability Serves Participants’ Best Interests - Part 2: An Enhanced Standard of Participant Care
In the second installment of his five-part series "How Auto Portability Serves Participants' Best Interests", RCH's Tom Hawkins examines how auto portability, by extending and
enhancing elements of automatic rollovers, establishes a new standard of
participant care. Auto portability, writes Hawkins, protects participants by: 1) minimizing time spent in a safe harbor IRA, 2)
eliminating the need to cash out balances less than $1,000, 3) enhancing
participant communication, 4) formally integrating a robust address location
search and 5) establishing a transparent, simple & straightforward fee
structure.
1916 Ayrsley Town Boulevard