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Retirement Clearinghouse in the News
Find news articles referencing RCH and our services, including RCH Auto Portability
PlanAdviser's Alex Ortolani covers the impending "live" date for auto portability, as delivered by the Portability Services Network, and turns to RCH's Spencer Williams and Neal Ringquist for their views. RCH has been working towards the debut "for about 10 years", writes Ortolani, which Williams refers to as "the long road, the hard road, and [we] have arrived at a spot that is, frankly, not only the best solution, but has promise of being even better.” RCH's Ringquist adds color on the cutover, speaking to the "staggered start" for recordkeepers and addressing the solid business case for moving small-balance accounts forward within the plan system.
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.
Featured in the 'Upfront' section of PLANSPONSOR's September-October magazine edition, Ed McCarthy performs a deep dive examination of auto portability, which McCarthy notes, has "has gained momentum in the past few years, culminating in the 2022 formation of the Portability Services Network, a company owned jointly by RCH and several of the largest U.S. recordkeepers." For details, McCarthy turns to RCH's Spencer Williams and Neal Ringquist, who opine on the technical details, while Vanguard's Steve Holman, a PSN Board member, offers the recordkeeping perspective.
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."
SHRM's Stephen Miller, CEBS, writing in SHRM's HR Today Magazine, examines "technological breakthroughs, red-tape-cutting legislation and new initiatives from service providers" that will dramatically -- and positively -- impact 401(k) and other defined contribution plans in the years to come. Miller identifies auto portability as one of four "megatrends" that will ensure small-balance accounts are not left behind, noting the emergence of the Portability Services Network, identifying auto portability's strong support from research institutions & legislators, and quoting industry experts, such as RCH's EVP Neal Ringquist and Alight Solutions' EVP Alison Borland.
Writing in 401k Specialist, RCH's Tom Hawkins describes the coming "shift" that will occur when the Portability Services Network (PSN) goes live at the beginning of the fourth quarter of 2023. Describing PSN's network-building achievements to date as "nothing short of phenomenal", Hawkins adds that "integration had proceeded apace" and that "plan sponsors will take center stage as they begin to adopt auto portability and witness its tangible results." Plan sponsor adoption will accelerate as auto portability demonstrates its obvious benefits to plans, to participants and to society at large, where adoption will eventually serve as a "positive indicator of a socially responsible enterprise."
RCH's Tom Hawkins, writing in 401k Specialist, describes the "brighter future" emerging for small-balance retirement savings accounts. Hawkins maintains that these accounts, which he associates with an increased incidence of sub-optimal participant outcomes, will fare much better in the future due to "large-scale, industry-led action on auto portability, and more recently, proactive steps being taken by leading providers to consolidate legacy small-balance IRAs."
Writing in 401kTV.com, Fred Barstein, Founder & Editor-in-Chief, cites a recent Employee Benefit News opinion piece authored by RCH President & CEO Spencer Williams. Barstein writes that Williams' article "spotlight[s] recent research from the Sauder School of Business that found that 41.4% of employees chose to cash out their 401(k) accounts when they left their employers" while adding that "auto-portability is a viable solution to improve retirement readiness in America and help retain assets in the nation’s retirement system." Barstein closes by imploring employers to "consider auto-portability options to make it easier for employees to take their 401(k) accounts with them when switching jobs."