Inflation Remains the Greatest Threat to Retirement
Voya Financial released new findings capturing the angst of future-thinking Americans who are concerned about being able to save enough for retirement.
The study also found:
- 66% of Americans agree or strongly agree that they are worried about the impact of inflation on their ability to save enough for retirement.
- 71% agree or strongly agree they are worried about the impact on their personal finances and the ability to maintain their current lifestyle.
- 84% feel like their money does not go as far as it used to go, leaving many to wonder how saving for the future can remain a priority.
Workers also want ongoing help from employers with recommendations on Social Security strategies, help forecasting retirement income, access to expertise on estate planning, opening an emergency savings account, and education savings tools.
What can plan sponsors do to help?
- Contact your recordkeeper about their existing financial wellness programs and ways to promote them.
- Partner with your financial advisor to educate employees about combating inflation and budgeting.
- Communicate regularly with employees about their financial needs.
If you’d like more ideas about helping to address participant concerns, reach out to your SRC account representative.
–Chris Oneal, President, Stones River Consulting
DOL AND LEGISLATIVE CORNER
SECURE Act 2.0 inches closer to bipartisan approval
The House of Representatives passed H.R. 2954 ‘‘Securing a Strong Retirement Act of 2022,’’ also known as SECURE 2.0, in late March.
There are several notable provisions, including:
- Requiring all new defined contribution plans (e.g., 401(k), 403(b), and SIMPLE plans, etc.) to automatically enroll participants with at least a 3% contribution rate and increase the rate by 1% per year to at least 10%, but no more than 15%.
- Providing tax incentives to small businesses to encourage them to offer plans to their employees.
- Creating a national online database to monitor lost retirement accounts.
The mandate of automatic enrollment is significant, and while it remains widely supported by Congress, it will have real implications for small businesses.
Stones River Consulting will closely watch the movement of this legislation and keep you informed.
Important Deadlines to Remember
- 15: All required plan data due to Stones River Consulting to allow us to complete your tax filing. If received after 05/15, a $250 rush fee will be assessed. Additional fees will apply in August if complete data is still missing.
- 30: Deadline for processing corrective distributions for failed ADP/ACP tests from plans with an EACA without a 10% excise tax. (TPA, Plan Sponsor, Recordkeeper)
- 15: Form 5558 to be filed for all plans that are pending submission to the IRS for Form 5500 to ensure timely filings. New filing deadline to be extended to October 15, 2022.
- 31: IRS deadline for filing Form 5500 without an extension or filing Form 5558 to extend Form 5500 filing date. (TPA, Plan Sponsor)
7 Signs Your Retirement Plan Needs an Upgrade
Retirement plans can be very complex if plan sponsors don’t have the right partner by their side to help navigate the ins and outs.
Stones River Consulting created a new guide titled, 7 Signs Your Retirement Plan Needs an Upgrade, that helps plan sponsors understand:
- What the four critical areas of a retirement plan are that need to be properly managed to maintain a successful retirement plan.
- Warning signs that a plan may be in danger of falling outside of compliance.
- How to get help to maintain a compliant retirement plan that benefits both the plan sponsor and its employees.
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