Auto Portability - Recent Developments
Find the most-recent auto portability media coverage and developments.
PLANSPONSOR reporter Noah Zuss covers EBRI's 1/20/22 Issue Brief #550, which examined the impact of four recent policy proposals upon the nation's retirement deficits, including their impact on racial and ethnic demographic segments. While all proposals reduced retirement savings shortfalls, the combination of ACPAs and an enhanced saver's credit produced the best results. Importantly, when auto portability was added to both the ACPA and saver's credit, overall retirement savings shortfalls further decreased by 10.8% to 14.3%, depending on race/ethnicity.
401k Specialist Editor-in-Chief John Sullivan examines the latest Issue Brief from the Employee Benefit Research Institute (EBRI), which assesses the impact of recently-proposed changes to the retirement system and how they could shrink retirement deficits. Sullivan notes that "combining automatic contribution provisions with an enhanced Saver’s Credit in 401ks and DC plans would reduce retirement savings shortfalls by 17% to 26%, depending on race" adding that "the addition of auto portability of retirement accounts resulted in a further double-digit reduction in savings shortfall across all races examined."
Robert L. Johnson, Founder and Chairman of The RLJ Companies and majority owner of Retirement Clearinghouse (RCH), has secured endorsements for auto portability from two premier civil rights organizations – the National Urban League, and the National Association for the Advancement of Colored People (NAACP) – both with over a century of experience advocating for solutions that address the inequities and economic challenges experienced by Black Americans and by other communities of color. Writing in 401k Specialist, RCH's Renée Wilder Guerin, Executive Vice President, Public Policy, summarizes these major developments.
On 12/6/21, Kathleen Kennedy Townsend, Special Assistant to the Secretary of Labor for Retirement, served as the keynote speaker at EBRI's 90th Public Policy Forum, and outlined the big-picture, retirement-focused priorities of the DOL. One of the DOL's three priorities is the issue of portability and leakage. Writing in 401k Specialist, RCH's Tom Hawkins examines Townsend's remarks to her EBRI audience, which revealed that she has a clear grasp of the magnitude of the cashout leakage problem, as well as its most-promising solution – enabling plan-to-plan portability.
On 12/6/21, Kathleen Kennedy Townsend, Special Assistant to the Secretary of Labor for Retirement, served as the keynote speaker at EBRI's 90th Public Policy Forum, and outlined the big-picture, retirement-focused priorities of the DOL. One of the DOL's three priorities is the issue of portability and leakage. RCH's Tom Hawkins examines Townsend's remarks to her EBRI audience, which revealed that she has a clear grasp of the magnitude of the cashout leakage problem, as well as its most-promising solution – enabling plan-to-plan portability.
Auto portability is a new “automatic” plan feature rapidly gaining acceptance by large defined contribution recordkeepers. While the feature is relatively new, it’s tempting to view auto portability as an “overnight success.” In fact, auto portability has been a long time in the making. In his latest article in 401k Specialist, RCH's Tom Hawkins examines a “brief history” of auto portability, including an embedded video featured on YouTube.
Writing in 401k Specialist Magazine, RCH's Tom Hawkins makes the case that auto portability can wait no longer and cites four key reasons that the new "automatic" feature should be adopted. Hawkins' key reasons include: 1) cashout leakage isn't waiting, 2) the "Great Resignation" is accelerating, 3) policy initiatives that expand access to workplace retirement plans require auto portability to realize their intended benefits, and 4) auto portability is here, now and working.
To mark the 25th anniversary of his tenure, Brian Graff, CEO of the prestigious American Retirement Association (ARA) sat down with 401k Specialist Editor-in-Chief John Sullivan to discuss a range of topics, including the organization's history of effectively influencing retirement legislation. During the interview, the pair turned to the important topic of addressing 401(k) cashout leakage, where Graff voiced his clear view that auto portability represents the best approach to solving the problem. A direct link to the specific portion of the interview that addresses auto portability is here.