Recently, Sens. Grassley(R-IA), Lankford (R-OK) and Hassan (D-NH) introduced the Improving Retirement Savings Act, this bill would make improvements to the SECURE Act. The bill would allow more groups to participate in multiple employer plans (MEPs) by allowing 403(b) plans to participate, it would also clarify that all small employers that join an MEP may take the small employer pension plan start-up credit for their first three years in an MEP, regardless of how long it has been in existence.
Nonprofits, public educational organizations, and religious institutions ((501)(c)(3) organizations) face financial and administrative challenges and legal risks when seeking to offer their employees a retirement plan, such as a 403(b). As a result, many do not offer their employees a retirement plan. These organizations and institutions would be more likely to offer retirement plans if they could band together to achieve larger economies of scale and delegate administrative and recordkeeping responsibilities, as well as plan sponsor duties to professional plan providers.
Employer-sponsored retirement savings plans that encourage employee participation are critical to the ongoing success and expansion of overall retirement readiness. NAIFA believes this approach is the most effective way for all workers to learn about the importance of saving, and to save adequately to meet their long-term financial goals.
NAIFA commends Sens. Grassley, Lankford and Hassan for their efforts to make it easier for small businesses to offer retirement plans, in conjunction with the retirement legislation being considered in the House and the Senate.
The Improving Retirement Savings Act would help to reinforce and better the improvements made on retirement savings plans in the SECURE Act. NAIFA is happy to support this legislation and looks forward to working with members of Congress to ensure its passage.