Auto Portability - Public Policy
Learn more about retirement savings public policy positions related to Auto Portability.
House Bill Seeks Automatic Rollover Of Retirement Accounts
Writing in the legal publication Law360, reporter Jared Serre notes that the introduction of a bill (HR 9252) in the U.S. House of Representatives "would allow for the automatic rollover of savings from 401(k) accounts from one employer to another after a job change is made." The bill, which complements provisions previously introduced in U.S. Senate legislation, was co-sponsored by Rep. Ron Estes (R-KS) and Rep. Brad Schneider (D-IL).
Creating a more secure financial future for American workers
In an opinion piece for The Hill, U.S. Senators Tim Scott (R-SC), and Sherrod Brown (D-OH) team up to make a convincing bipartisan case for auto portability, which the legislators are seeking to further with the Advancing Auto Portability Act of 2022, provisions of which were subsequently incorporated into a broader Senate bill. Scott and Brown view auto portability as an urgent and necessary remedy to the problem of cashout leakage, writing that auto portability "would solve this [leakage] problem by allowing workers to automatically roll over savings from their previous employer to a new employer." They close with an appeal to fellow legislators, writing: "[w]e encourage our colleagues to support this bipartisan, commonsense legislation that will create a more secure financial future for American workers, and save people precious time and money."
Why DEI and ‘Traditional’ Automatic Rollovers Don’t Mix
When it comes to 401(k) diversity, equity, and inclusion (DEI) initiatives, RCH’s Tom Hawkins observes broad support for expanded access and automatic features, since they “are supportive of increasing participation and asset accumulation across all demographics.” No one, writes Hawkins, points to ‘traditional’ automatic rollovers as facilitating DEI goals, as they “penalize the very demographic segments that DEI initiatives strive to uplift.” Hawkins urges plan sponsors to re-tool ‘traditional’ automatic rollover programs to include education and assistance and to incorporate auto portability – delivering more equitable retirement outcomes for under-saved and under-served participants.
401k Plans: An Ongoing Public-Private Partnership That Works
In observance of National 401(k) Day on Friday, September 9th, RCH's Tom Hawkins takes the opportunity to reflect on the long-running, highly successful public-private collaboration that has fostered the rapid ascendance of America’s 401(k) system. Writing in 401k Specialist Magazine, Hawkins states that "this partnership will continue to drive innovations that will expand and improve the 401k system for millions of Americans – not only helping them to save more but preserving more of their savings for retirement."
401(k) Fees Lower than IRA Alternative
Steff Chalk, 401kTV's Managing Editor, informs readers about new Pew Charitable Trust research that finds 401(k) fees can be lower than IRA fees, often by a wide margin. Chalk links the research findings to auto portability, noting that policymakers could act by "furthering auto portability as a way to transfer assets between retirement plans."
Advisers in conversation: Creating lifetime income in retirement
EBN's Stephanie Schomer interviews 401(k) legend Ted Benna, responsible for designing and implementing the first 401(k) savings plan, and Mandy Zatto, co-founder and principal, Strategic Benefits Advisors. When the topic turns to job-changing participants and how to protect their nest egg, both Benna and Zatto find praise for auto portability, for Retirement Clearinghouse, and for the recently-introduced Senate legislation containing provisions that support the new plan feature.
Nevin & Fred: EARN, RISE & SHINE, Auto-Portability & the Way(s) Forward
In their ongoing podcast series featured in NAPA Net, American Retirement Association Chief Content Officer Nevin Adams and ERISA fiduciary expert Fred Reish discuss the latest retirement public policy initiatives to emanate from Washington, DC. In their discussion, Adams and Reish focus extensively on the Senate's Enhancing American Retirement Now (EARN) Act of 2022. The podcast's hosts go in-depth on the bill's auto portability provisions, which they view highly favorably, and Adams supplies listeners with an excellent overview of how auto portability works.
Newly Proposed Legislation Can Help Resolve America’s Retirement-Savings Gaps
Writing in the RCH Consolidation Corner blog, RCH founder, president & CEO Spencer Williams delves into recently-proposed legislation in the U.S. Senate, making the case that its auto portability-related provisions will make a real difference in the retirement security of millions of hardworking Americans. Citing Vanguard's recently-released How America Saves report, Williams notes that the highly-respected annual report "underscored that premature cash-outs of small 401(k) balances continue to threaten retirement readiness for plan participants, especially those who are younger and have less savings." Williams quotes the Vanguard research as concluding that "[a]uto portability services and revisions to minimum balance rules can help decrease cash out rates." Williams goes on to praise the Senate's bipartisan approach to the bill, adding: "[i}f the legislation is signed into law, the retirement-savings gaps in our society can begin to be filled."
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