Retirement Regulation

As ideas on how best to help employees save money for retirement continue to advance, employers and plan sponsors will need to stay abreast of the changing regulatory requirements and evolving participant needs.

With just 24% of workers feeling confident that they'll be able to retire comfortably, a new report identifies key focus areas where employers can make a difference, such as employees with student loans and low-income workers.

The new legislation is the most extensive update in retirement law in the past 15 years, however, there are distinct areas that Congress should address for a more effective retirement income system, says the Brookings Institution.

The legislation would require firms with 10+ employees to automatically enroll all full-time and long-term part-time employees in an automatic IRA or 401(k) plan, allowing workers to decline to participate at any time after enrollment.

The new rule aims to rein in any predatory practices around rollover recommendations from commission-based advisors, but employers can protect themselves by offering objective, retirement planning advice inexpensively.

Here are several key items that need to be kept in mind for businesses and their benefits teams as they look to meet SECURE Act 2.0 compliance demands.

In 2024, a provision in SECURE 2.0 takes effect that provides a new option tying student debt repayments to 401(k) plans but clearly communicating to employees why and how to opt into the new program is key to adoption.

The new legislation represents a landmark in the evolution of retirement planning, benefiting employees in unique situations – facing student debt, saving for college or suffering from domestic abuse.