My ‘Retirement’ Thanksgiving

 Thanksgiving has been called a “uniquely American” holiday — and as we approach the holiday season, it seems appropriate to take a moment to reflect upon, and acknowledge — to give thanks, if you will.

Indeed, even amidst all of the strife and turmoil in our world, there remains much for which we can all be thankful. And in this, my third year of “retirement” — well, my list seems even longer.

I’m once again thankful that so many employers (still) voluntarily choose to offer a workplace retirement plan — and, particularly in these extraordinary times, that so many have remained committed to that promise. I’m hopeful that the incentives in SECURE and SECURE 2.0 will continue to spur more to provide that opportunity — and encouraged by the current rate of adoptions.

I’m thankful that so many workers, given an opportunity to participate in these programs, (still) do. And that, under new provisions in SECURE 2.0, those who gain new access to those programs will be automatically enrolled. I’m also encouraged (and thankful) by a sense that the automatic enrollment requirement doesn’t seem to have impacted the volume of new plan formation.

I’m thankful that the vast majority of workers defaulted into retirement savings programs tend to remain there — and that there are mechanisms (automatic enrollment, contribution acceleration and qualified default investment alternatives) in place to help them save and invest better than they might otherwise.

I’m thankful for new and modestly expanded contribution limits for these programs (I’d have been more thankful if we’d had them sooner) — and hopeful that that will encourage more workers to take full advantage of those opportunities. I’m particularly thankful that the new so-called “super” catch-up limits will provide even more help.

I’m not (completely) thankful for the new cap on pre-tax catch-up savings, though I suspect most will be appreciative of that shift once they get to retirement (seriously — do you think tax rates are going to decline?).

I’m thankful for the Roth savings option that provides workers with a choice on how and when they’ll pay taxes on their retirement savings. “Retirement” has served to remind me that there’s a LOT to be said in favor of tax diversification, particularly the way benefits like Social Security and Medicare are means-tested.

I’m thankful that our industry continues to explore and develop fresh alternatives to the challenge of decumulation — helping those who have been successful at accumulating retirement savings find prudent ways to effectively draw them down in a way that provides a financially sustainable retirement. Trust me, knowing how much your retirement income will be is an essential element in knowing when you can comfortably retire.

I’m thankful for qualified default investment alternatives that make it easy for participants to benefit from well diversified and regularly rebalanced investment portfolios — and for the thoughtful and ongoing review of those options by prudent plan fiduciaries. I’m hopeful (if somewhat skeptical) that the nuances of those glidepaths have been adequately explained to those who invest in them, and that those nearing retirement will be better served by those devices than many were a couple of decades ago (though my recent perusal of the age-65 glidepaths for several leading providers leaves me skeptical).

I’m thankful that the state-run IRAs for private sector workers are enjoying some success in closing the coverage gap, providing workers who ostensibly lacked access to a workplace retirement plan that option. However, I’m even more thankful that the existence of those programs continues to engender a greater interest on the part of small business owners to provide access to a “real” retirement plan like a 401(k).

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I’m thankful that figuring out ways to expand access to workplace retirement plans remains, even now, a bipartisan focus — even if the ways to address it aren’t always.

I’m thankful that the ongoing “plot” to kill the 401(k)…despite some new voices…(still) hasn’t.

I’m thankful that those who regulate our industry continue to seek the input of those in the industry — and that so many, particularly those among the ARA membership, take the time and energy to provide that input.

I’m thankful to (still) be part of a team (even in “retirement”) that champions retirement savings — and to be a part of helping improve and enhance that system.

I’m thankful — even in “retirement” — to continue to be able to make a “difference.” I’m thankful for those who seek me out at various events, or via email, to tell me how much they enjoy and appreciate my writing and speaking.

I am, of course, thankful for being able to “retire” — to kick back a bit. While I continue to get good-natured ribbing about how I don’t understand the concept, this my third year of not working full-time has been a blessing in so many ways (thanks especially Bonnie Treichel, Todd Kading and Kassandra Hendrix). I’m especially grateful to my wife for her encouragement and support throughout nearly four decades (amidst a LOT of sacrifices) as we both “adjust.” 

I’m thankful for the new home we’ve established as a base from which to enter that next chapter — and the “Velocity Blue” Mustang GT in which I get to explore it.  

I’m thankful that I was able to be with my Mom when she passed last year, for the comfort that her faith brought her and us, and the spirit in which our family was able to work together through the process of winding up her estate.

But most of all, I’m once again thankful for the unconditional love and patience of my wife, the camaraderie of an expanding circle of dear friends and colleagues, the opportunity to write and share these thoughts — and for the ongoing support and appreciation of dear readers… like you.

Wishing you and yours a very happy Thanksgiving!

• Nevin E. Adams, JD

A Retirement Thanksgiving . . . From ‘Retirement’

  Thanksgiving has been called a “uniquely American” holiday — and as we approach the holiday season, it seems appropriate to take a moment to reflect upon, and acknowledge — to give thanks, if you will.

While it’s the celebration following a successful harvest held by the group we now call “Pilgrims” and members of the Wampanoag tribe in 1621 that provides most of the imagery around the holiday, Thanksgiving didn’t become a national observance until much later.

On Oct. 3, 1789, George Washington issued his Thanksgiving proclamation, designating for “the People of the United States a day of public thanks-giving” to be held on “Thursday the 26th day of November,” 1789, marking the first national celebration of the holiday. However, subsequent presidents failed to carry forward this tradition.     

Incredibly, it wasn’t marked as a national observance until 1863 — right in the middle of the Civil War, (also on Oct. 3) and at a time when, arguably, there was little for which to be thankful. Indeed, President Abraham Lincoln, in his proclamation regarding the observance, called on all Americans to ask God to “commend to his tender care all those who have become widows, orphans, mourners or sufferers in the lamentable civil strife” and to “heal the wounds of the nation.”

We could surely stand to have some of that today. 

But for those of you who think the political harshness of today is a new phenomenon, consider that Thanksgiving was not made a legal holiday until 1941 when Congress named the fourth Thursday in November as our national day of thanks…in an answer to public outcry over President Roosevelt's attempt to prolong the Christmas shopping season by moving Thanksgiving from the traditional last Thursday to the third Thursday of November.

My List

With all of the strife and turmoil in our world, there remains much for which we can all be thankful. And in this, my second year of “retirement” — well, the list seems even longer. 

I’m once again thankful that so many employers (still) voluntarily choose to offer a workplace retirement plan — and, particularly in these extraordinary times, that so many have remained committed to that promise. I’m hopeful that the incentives in SECURE and SECURE 2.0 will continue to spur more to provide that opportunity.

I’m thankful that so many workers, given an opportunity to participate in these programs, (still) do. And that, under new provisions in SECURE 2.0, those who gain new access to those programs will be automatically enrolled, if not immediately, then in the weeks ahead.

I’m thankful that the vast majority of workers defaulted into retirement savings programs tend to remain there — and that there are mechanisms (automatic enrollment, contribution acceleration and qualified default investment alternatives) in place to help them save and invest better than they might otherwise.

I’m thankful for new and modestly expanded contribution limits for these programs — and hopeful that that will encourage more workers to take full advantage of those opportunities, even if the increases aren’t as big as last year’s (on the other hand, inflation isn’t as high, either).

I’m thankful for the Roth savings option that provides workers with a choice on how and when they’ll pay taxes on their retirement savings. “Retirement” reminds me that there’s a LOT to be said in favor of tax diversification, particularly the way benefits like Social Security and Medicare are means-tested.

I continue to be thankful that participants, by and large, continue to hang in there with their commitment to retirement savings, despite lingering economic uncertainty, rising inflation, and competing financial priorities, such as rising health care costs and college debt.

I’m thankful for the strong savings and investment behaviors (still) evident among younger workers — and for the innovations in plan design and employer support that foster them. I’m thankful that, as powerful as those mechanisms are in encouraging positive savings behavior, we continue to look for ways to improve and enhance their influence(s).

I’m thankful that our industry continues to explore and develop fresh alternatives to the challenge of decumulation — helping those who have been successful at accumulating retirement savings find prudent ways to effectively draw them down and provide a financially sustainable retirement. Trust me, knowing how much your retirement income will be is an essential element in knowing when you can comfortably retire.

I’m thankful for qualified default investment alternatives that make it easy for participants to benefit from well diversified and regularly rebalanced investment portfolios — and for the thoughtful and ongoing review of those options by prudent plan fiduciaries. I’m hopeful (if somewhat skeptical) that the nuances of those glidepaths have been adequately explained to those who invest in them, and that those nearing retirement will be better served by those devices than many were a couple of decades ago (though looking at the age 65 glidepaths for several leading providers, I’m again skeptical).

I’m thankful that the state-run IRAs for private sector workers are enjoying some success in closing the coverage gap, providing workers who ostensibly lacked access to a workplace retirement plan have that option. I’m even more thankful that the existence of those programs appears to be engendering a greater interest on the part of small business owners to provide access to a “real” retirement plan.

I’m thankful that figuring out ways to expand access to workplace retirement plans remains, even now, a bipartisan focus — even if the ways to address it aren’t always.

I’m thankful that the ongoing “plot” to kill the 401(k) … despite some new voices … (still) hasn’t.

I’m thankful that those who regulate our industry continue to seek the input of those in the industry — and that so many, particularly those among our membership, take the time and energy to provide that input.

I’m thankful to (still) be part of a team that champions retirement savings — and to be a part of helping improve and enhance that system.

I’m thankful for the involvement, engagement, and commitment of our various member committees that magnify and enhance the quality and impact of our events, education, and advocacy efforts.

I’m also thankful for the development of professional education and credentials that allow the professionals in our industry to expand and advance their knowledge, as well as the services they provide in support of Americans’ retirement.  I’m thankful for the consistent — and enthusiastic — support of our event sponsors and advertisers.

I’m thankful for the warmth, engagement and encouragement with which readers and members, both old and new, continue to embrace the work we do here.

I’m thankful — even in “retirement” — to continue to be able to make a “difference.” I’m thankful for those who seek me out at various events, or via email, to tell me how much they enjoy and appreciate my writing and speaking.

I am, of course, thankful for being able to “retire” — to kick back a bit. While I continue to get good-natured ribbing about how I don’t know how to “retire,” this second year of not working full-time has been a blessing in so many ways. I’m especially grateful to my wife for her encouragement and support throughout nearly four decades (amidst a LOT of sacrifices) and look forward to this next chapter in our lives. I’m thankful for the new home we’ve established as a base from which to enter that next chapter.  

But most of all, I’m once again thankful for the unconditional love and patience of my family, the camaraderie of an expanding circle of dear friends and colleagues, the opportunity to write and share these thoughts — and for the ongoing support and appreciation of readers… like you.

Wishing you and yours a very happy Thanksgiving!

- Nevin E. Adams, JD

A 'Retirement' Thanksgiving

Thanksgiving has been called a “uniquely American” holiday—and so, even in a year in which there has been what seems to be an unprecedented amount of disruption, frustration, stress, discomfort and loss—there remains so much for which to be thankful. And as we approach the holiday season, it seems appropriate to take a moment to reflect upon, and acknowledge—to give thanks, if you will.

While it’s the celebration following a successful harvest held by the group we now call “Pilgrims” and members of the Wampanoag tribe in 1621 that provides most of the imagery around the holiday, Thanksgiving didn’t become a national observance until much later.

Incredibly, it wasn’t marked as a national observance until 1863—right in the middle of the Civil War, and at a time when, arguably, there was little for which to be thankful. Indeed, President Abraham Lincoln, in his proclamation regarding the observance, called on all Americans to ask God to “commend to his tender care all those who have become widows, orphans, mourners or sufferers in the lamentable civil strife” and to “heal the wounds of the nation.”

We could surely stand to have some of that today.  

My List

With all of the strife and turmoil in our world, there remains much for which we can all be thankful. And in this, my first year of “retirement”—well, the list seems even longer this year. 

I’m once again thankful that so many employers (still) voluntarily choose to offer a workplace retirement plan—and, particularly in these extraordinary times, that so many have remained committed to that promise. I’m hopeful that the encouragements of prospective legislation, if not the requirements of same, will continue to spur more to provide that opportunity.

I’m thankful that there are provisions in SECURE 2.0 that will further, and perhaps dramatically, encourage plan adoption.

I’m thankful that so many workers, given an opportunity to participate in these programs, (still) do. And that, under new provisions in SECURE 2.0, those who gain new access to those programs will be automatically enrolled, if not immediately, then in 2025.

I’m thankful that the vast majority of workers defaulted into retirement savings programs tend to remain there—and that there are mechanisms (automatic enrollment, contribution acceleration and qualified default investment alternatives) in place to help them save and invest better than they might otherwise.

I’m thankful for new and expanded contribution limits for these programs—and hopeful that that will encourage more workers to take full advantage of those opportunities, even if the increases aren’t as big as last year’s (on the other hand, inflation isn’t as high, either).

I’m thankful for the Roth savings option that, for all the negative press and focus on the accounts of a few wealthy individuals, provides workers with a choice on how and when they’ll pay taxes on their retirement savings. There’s a LOT to be said in favor of tax diversification, particularly the way benefits like Social Security and Medicare are means-tested.

I continue to be thankful that participants, by and large, continue to hang in there with their commitment to retirement savings, despite lingering economic uncertainty, rising inflation, and competing financial priorities, such as rising health care costs and college debt—and that their employers continue to see—and support—the merit of such programs.

I’m thankful for the strong savings and investment behaviors (still) evident among younger workers—and for the innovations in plan design and employer support that foster them. I’m thankful that, as powerful as those mechanisms are in encouraging positive savings behavior, we continue to look for ways to improve and enhance their influence(s).

I’m thankful that our industry continues to explore and develop fresh alternatives to the challenge of decumulation—helping those who have been successful at accumulating retirement savings find prudent ways to effectively draw them down and provide a financially sustainable retirement. Trust me, knowing how much your retirement income will be is an essential element in knowing when you can retire.

I’m thankful for qualified default investment alternatives that make it easy for participants to benefit from well diversified and regularly rebalanced investment portfolios—and for the thoughtful and ongoing review of those options by prudent plan fiduciaries. I’m hopeful (if somewhat skeptical) that the nuances of those glidepaths have been adequately explained to those who invest in them, and that those nearing retirement will be better served by those devices than many were a couple of decades ago.

I’m thankful that the state-run IRAs for private sector workers are enjoying some success in closing the coverage gap, providing workers who ostensibly lacked access to a workplace retirement plan have that option. I’m even more thankful that the existence of those programs appears to be engendering a greater interest on the part of small business owners to provide access to a “real” retirement plan.

I’m thankful that figuring out ways to expand access to workplace retirement plans remains, even now, a bipartisan focus—even if the ways to address it aren’t always.

I’m thankful that the ongoing “plot” to kill the 401(k)… (still) hasn’t. Yet. Let’s face it, it has a new name, and some new supporters—but…

I’m thankful for the opportunity to acknowledge so many outstanding professionals in our industry through our Top Women Advisors, Top Young Retirement Plan Advisors (“Aces”), Top DC Wholesaler (Advisor Allies), and Top DC Advisor Team lists. I am thankful for the blue-ribbon panels of judges that volunteer their time, perspective and expertise to those evaluations.

I’m thankful that those who regulate our industry continue to seek the input of those in the industry—and that so many, particularly those among our membership, take the time and energy to provide that input.

I’m thankful to (still) be part of a team that champions retirement savings—and to be a part of helping improve and enhance that system.

I’m thankful for those who have supported—and I trust benefited from—our various conferences, education programs and communications throughout the year—particularly at a time like this, when it remains difficult—and complicated—to undertake, and participate in, those activities.

I’m thankful for the involvement, engagement, and commitment of our various member committees that magnify and enhance the quality and impact of our events, education, and advocacy efforts.

I’m also thankful for the development of professional education and credentials that allow the professionals in our industry to expand and advance their knowledge, as well as the services they provide in support of Americans’ retirement.

I’m thankful for the consistent—and enthusiastic—support of our event sponsors and advertisers.

I’m thankful for the warmth, engagement and encouragement with which readers and members, both old and new, continue to embrace the work we do here.

I’m thankful for the team here at NAPA, ASPPA, NTSA, ASEA, PSCA (and the American Retirement Association, generally), and for the strength, commitment and diversity of the membership. I’m thankful—even in “retirement”—to continue to be able to make a “difference.” I’m especially thankful to have a friend and true professional like John Sullivan ready, willing and able to step in as Chief Content Officer. There are few experiences more miserable than having a job you love taken over by someone who doesn’t. I’m thankful, so thankful that hasn’t been the case here. 

I am, of course, thankful for being able to “retire”—to kick back a bit. While I continue to get good-natured ribbing about how I don’t know how to “retire,” this first year of not working full-time has been a blessing in so many ways. I’m especially grateful to my wife for her encouragement and support throughout nearly four decades (amidst a LOT of sacrifices) and look forward to this next chapter in our lives.   

But most of all, I’m once again thankful for the unconditional love and patience of my family, the camaraderie of an expanding circle of dear friends and colleagues, the opportunity to write and share these thoughts—and for the ongoing support and appreciation of readers… like you.

Wishing you and yours a very happy Thanksgiving!

Thanks, Giving

While it’s the celebration following a successful harvest held by the Pilgrims and members of the Wampanoag tribe in 1621 that provides most of the imagery around the holiday, Thanksgiving didn’t become a national observance until much later.

Incredibly, it wasn’t marked as a national observance until 1863—right in the middle of this nation’s Civil War, and at a time when, arguably, there was little for which to be thankful. Indeed, President Abraham Lincoln, in his proclamation regarding the observance, called on all Americans to ask God to “commend to his tender care all those who have become widows, orphans, mourners or sufferers in the lamentable civil strife” and to “heal the wounds of the nation.” 

We could surely stand to have some of that these days.   

Thanksgiving has been called a “uniquely American” holiday—and so, even in a year in which there has been what seems to be an unprecedented amount of disruption, frustration, stress, discomfort and loss—there remains so much for which to be thankful. And as we approach the holiday season, it seems appropriate to once again take a moment to reflect upon, and acknowledge—to give thanks, if you will.

I’m once again thankful that so many employers (still) voluntarily choose to offer a workplace retirement plan—and, particularly in these extraordinary times, that so many have remained committed to that promise. I’m hopeful that the encouragements of prospective legislation, if not the requirements of same, will continue to spur more to provide that opportunity. 

I’m thankful that amidst all the turmoil and strife in our political system, we’ve seen near-unanimous bipartisan support for legislation that stands to enhance the retirement of tens of millions of Americans.

I’m thankful that so many workers, given an opportunity to participate in these programs, (still) do.

I’m thankful that the vast majority of workers defaulted into retirement savings programs tend to remain there—and that there are mechanisms (automatic enrollment, contribution acceleration and qualified default investment alternatives) in place to help them save and invest better than they might otherwise.

I’m thankful for the dozen or so state IRAs for private sector workers that, despite relatively high opt-out rates, are providing millions of Americans an opportunity to save through payroll deduction.  I’m even more thankful that the employer mandates associated with these programs are encouraging employers to consider more robust workplace retirement savings programs, like 401(k)s.

I’m thankful for new and expanded contribution limits for these workplace retirement programs—and even though it was spurred by dramatic increases in inflation and the prospect for higher costs in retirement, I’m hopeful that that will encourage more workers to take full advantage of those opportunities.

I’m thankful for the Roth savings option that provides workers with a choice on how and when they’ll pay taxes on their retirement savings.

I continue to be thankful that participants, by and large, continue to hang in there with their commitment to retirement savings, despite lingering economic uncertainty, volatile markets, rising inflation, and competing financial priorities—and that their employers continue to see—and support—the merit of such programs.

I’m thankful for qualified default investment alternatives that make it easy for participants to benefit from well diversified and regularly rebalanced investment portfolios—and for the thoughtful and ongoing review of those options by prudent plan fiduciaries. I’m hopeful (if somewhat skeptical) that the nuances of those glidepaths have been adequately explained to those who invest in them, and that those nearing retirement will be better served by those devices than many were a decade ago.

I’m thankful that our industry continues to explore and develop fresh alternatives to the challenge of decumulation—helping those who have been successful at accumulating retirement savings find prudent ways to effectively draw them down and provide a financially sustainable retirement.   

I’m thankful that the ongoing “plot” to kill the 401(k)… (still) hasn’t. Yet.

I’m thankful for the opportunity to acknowledge so many outstanding professionals in our industry through our Top Women Advisors, Top Young Retirement Plan Advisors (“Aces”), Top DC Wholesaler (Advisor Allies), and Top DC Advisor Team lists. I am thankful for the blue-ribbon panels of judges that volunteer their time, perspective and expertise to those evaluations.

I’m thankful for the opportunity to give advisors a voice in acknowledging the best recordkeepers in the industry via our new Advisors’ Choice accolade.

I’m thankful that those who regulate our industry continue to seek the input of those in the industry—and that so many, particularly those among our membership, take the time and energy to provide that input.

I’m thankful to be part of a team that champions retirement savings—and to be a part of helping improve and enhance that system.

I’m thankful for those who have supported—and I trust benefited from—our various conferences, education programs and communications throughout the year—particularly at a time like this, when it remains difficult—and complicated—to undertake, and participate in, those activities. 

I’m thankful for the involvement, engagement, and commitment of our various member committees that magnify and enhance the quality and impact of our events, education, and advocacy efforts. 

I’m also thankful for the development of professional education and credentials that allow the professionals in our industry to expand and advance their knowledge, as well as the services they provide in support of Americans’ retirement. 

I’m thankful for the constant—and enthusiastic—support of our event sponsors and advertisers—again, particularly during a period when so many adjustments have had to be made.

I’m thankful for the warmth, engagement and encouragement with which readers and members, both old and new, continue to embrace the work we do here.

I’m thankful for the team here at NAPA, ASPPA, NTSA, ASEA, PSCA (and the American Retirement Association, generally), and for the strength, commitment and diversity of the membership. I’m thankful to be part of a growing organization in an important industry at a critical time. I’m thankful to be able, in some small way, to make a difference.

I’m particularly thankful for the education, support, and availability of programs in our private retirement system that have allowed me to contemplate my own “retirement” in just a few more months.

But most of all, I’m once again thankful for the unconditional love and patience of my family, the camaraderie of an expanding circle of dear friends and colleagues, the opportunity to write and share these thoughts—and for the ongoing support and appreciation of readers… like you.

Wishing you and yours a very happy Thanksgiving!

- Nevin E. Adams, JD

A Season of Thanksgiving

 

While it’s the celebration following a successful harvest held by the Pilgrims and members of the Wampanoag tribe in 1621 that provides most of the imagery around the holiday, Thanksgiving didn’t become a national observance until much later.

Incredibly, it wasn’t marked as a national observance until 1863—right in the middle of the Civil War, and at a time when, arguably, there was little for which to be thankful. Indeed, President Abraham Lincoln, in his proclamation regarding the observance, called on all Americans to ask God to “commend to his tender care all those who have become widows, orphans, mourners or sufferers in the lamentable civil strife” and to “heal the wounds of the nation.” 

We could surely stand to have some of that today.   

Thanksgiving has been called a “uniquely American” holiday—and so, even in a year in which there has been what seems to be an unprecedented amount of disruption, frustration, stress, discomfort and loss—there remains so much for which to be thankful. And as we approach the holiday season, it seems appropriate to take a moment to reflect upon, and acknowledge—to give thanks, if you will.

I’m once again thankful that so many employers (still) voluntarily choose to offer a workplace retirement plan—and, particularly in these extraordinary times, that so many have remained committed to that promise. I’m hopeful that the encouragements of prospective legislation, if not the requirements of same, will continue to spur more to provide that opportunity.

I’m thankful that so many workers, given an opportunity to participate in these programs, (still) do.

I’m thankful that the vast majority of workers defaulted into retirement savings programs tend to remain there—and that there are mechanisms (automatic enrollment, contribution acceleration and qualified default investment alternatives) in place to help them save and invest better than they might otherwise.

I’m thankful for new and expanded contribution limits for these programs—and hopeful that that will encourage more workers to take full advantage of those opportunities.

I’m thankful for the Roth savings option that, for all the negative press and focus on the accounts of a few wealthy individuals, provides workers with a choice on how and when they’ll pay taxes on their retirement savings.

I continue to be thankful that participants, by and large, continue to hang in there with their commitment to retirement savings, despite lingering economic uncertainty, rising inflation, and competing financial priorities, such as rising health care costs and college debt—and that their employers continue to see—and support—the merit of such programs.

I’m thankful for the strong savings and investment behaviors (still) evident among younger workers—and for the innovations in plan design and employer support that foster them. I’m thankful that, as powerful as those mechanisms are in encouraging positive savings behavior, we continue to look for ways to improve and enhance their influence(s).

I’m thankful that our industry continues to explore and develop fresh alternatives to the challenge of decumulation—helping those who have been successful at accumulating retirement savings find prudent ways to effectively draw them down and provide a financially sustainable retirement.   

I’m thankful for qualified default investment alternatives that make it easy for participants to benefit from well diversified and regularly rebalanced investment portfolios—and for the thoughtful and ongoing review of those options by prudent plan fiduciaries. I’m hopeful (if somewhat skeptical) that the nuances of those glidepaths have been adequately explained to those who invest in them, and that those nearing retirement will be better served by those devices than many were a decade ago.

I’m thankful that the state-run IRAs for private sector workers are enjoying some success in closing the coverage gap, providing workers who ostensibly lacked access to a workplace retirement plan have that option. I’m even more thankful that the existence of those programs appears to be engendering a greater interest on the part of small business owners to provide access to a “real” retirement plan.

I’m thankful that figuring out ways to expand access to workplace retirement plans remains, even now, a bipartisan focus—even if the ways to address it aren’t always.

I’m thankful that the ongoing “plot” to kill the 401(k)… (still) hasn’t. Yet.

I’m thankful for the opportunity to acknowledge so many outstanding professionals in our industry through our Top Women Advisors, Top Young Retirement Plan Advisors (“Aces”), Top DC Wholesaler (Advisor Allies), and Top DC Advisor Team lists. I am thankful for the blue-ribbon panels of judges that volunteer their time, perspective and expertise to those evaluations.

I’m thankful that those who regulate our industry continue to seek the input of those in the industry—and that so many, particularly those among our membership, take the time and energy to provide that input.

I’m thankful to be part of a team that champions retirement savings—and to be a part of helping improve and enhance that system.

I’m thankful for those who have supported—and I trust benefited from—our various conferences, education programs and communications throughout the year—particularly at a time like this, when it remains difficult—and complicated—to undertake, and participate in, those activities. 

I’m thankful for the involvement, engagement, and commitment of our various member committees that magnify and enhance the quality and impact of our events, education, and advocacy efforts. 

I’m also thankful for the development of professional education and credentials that allow the professionals in our industry to expand and advance their knowledge, as well as the services they provide in support of Americans’ retirement. 

I’m thankful for the constant—and enthusiastic—support of our event sponsors and advertisers—again, particularly during a period when so many adjustments have had to be made.

I’m thankful for the warmth, engagement and encouragement with which readers and members, both old and new, continue to embrace the work we do here.

I’m thankful for the team here at NAPA, ASPPA, NTSA, ASEA, PSCA (and the American Retirement Association, generally), and for the strength, commitment and diversity of the membership. I’m thankful to be part of a growing organization in an important industry at a critical time. I’m thankful to be able, in some small way, to make a difference.

But most of all, I’m once again thankful for the unconditional love and patience of my family, the camaraderie of an expanding circle of dear friends and colleagues, the opportunity to write and share these thoughts—and for the ongoing support and appreciation of readers… like you.

Wishing you and yours a very happy Thanksgiving!

- Nevin E. Adams, JD

 

Thanks, Giving

Thanksgiving has been called a “uniquely American” holiday —and so, even in a year in which there has been an unprecedented amount of disruption, stress, discomfort, and loss—there remains so much for which to be thankful. 

I’m thankful that so many employers (still) voluntarily choose to offer a workplace retirement plan—and, particularly in this extraordinary year, that so many have remained committed to that promise.

I’m thankful that the vast majority of workers defaulted into retirement savings programs tend to remain there—and that there are mechanisms (automatic enrollment, contribution acceleration and qualified default investment alternatives) in place to help them save and invest better than they might otherwise.

I continue to be thankful that participants, by and large, continue to hang in there with their commitment to retirement savings, despite lingering economic uncertainty and competing financial priorities, such as rising health care costs and college debt—and the consequences of the pandemic.

I’m thankful for the strong savings and investment behaviors emerging among younger workers—and for the innovations in plan design and employer support that foster them. I’m thankful that, as powerful as those mechanisms are in encouraging positive savings behavior, we continue to look for ways to improve and enhance their influence(s).

I’m thankful for qualified default investment alternatives that make it easy for participants to benefit from well-diversified and regularly rebalanced investment portfolios—and for the thoughtful and ongoing review of those options by prudent plan fiduciaries. I’m hopeful that the nuances of those glidepaths have been adequately explained to those who invest in them, and that those nearing retirement will be better served by those devices than many were a decade ago.

I’m thankful that so many workers, given an opportunity to participate, (still) do. I’m particularly thankful this year that so many were able to do so without taking advantage of the expanded access to those accounts via the provisions of the CARES Act.

I’m thankful that those on Capitol Hill were able to (mostly) set aside partisan differences long enough to pass the CARES act, including those expanded access provisions and the Payroll Protection Program, which likely helped many avoid having to tap into their retirement savings.

I’m thankful for the hard work of so many recordkeepers, TPAs, accountants, advisors and attorneys who—under strained and stressful conditions of their own—worked through and helped their plan sponsor clients and participants work through—the provisions and practical implications of the CARES Act (and just mere weeks after having done so for the SECURE Act).  

I’m thankful that figuring out ways to expand access to workplace retirement plans remains, even now, a bipartisan focus—even if the ways to address it aren’t always.

I’m thankful that the ongoing “plot” to kill the 401(k)… (still) hasn’t. Yet.

I’m thankful for the opportunity to acknowledge so many outstanding professionals in our industry through our Top Women Advisors, Top Young Retirement Plan Advisors (“Aces”), Top DC Wholesaler (Advisor Allies), and Top DC Advisor Team lists. I am thankful for the blue-ribbon panels of judges that volunteer their time, perspective and expertise to those evaluations.

I’m thankful that those who regulate our industry continue to seek the input of those in the industry—and that so many, particularly those among our membership, take the time and energy to provide that input.

I’m thankful to be part of a team that champions retirement savings—and to be a part of helping improve and enhance that system.

I’m thankful for all of you who have supported—and I hope benefited from—our various conferences, education programs and communications throughout the year—particularly in a year like this, when it has been so difficult to undertake, and participate in, those activities. I’m hopeful that at some point in the near future we’ll be able to do so… together.

I’m thankful for the involvement, engagement, and commitment of our various member committees that magnify and enhance the quality and impact of our events, education, and advocacy efforts.

I’m thankful for the constant—and enthusiastic—support of our event sponsors and advertisers—again, particularly in a year when so many adjustments have had to be made.

I’m thankful for the warmth, engagement and encouragement with which readers and members, both old and new, continue to embrace the work we do here.

I’m thankful for the team here at NAPA, ASPPA, NTSA, ASEA, PSCA (and the American Retirement Association, generally, as well as all the sister associations), and for the strength, commitment and diversity of the membership. I’m thankful to be part of a growing organization in an important industry at a critical time. I’m thankful to be able, in some small way, to make a difference.

But most of all, I’m once again thankful for the unconditional love and patience of my family, the camaraderie of an expanding circle of dear friends and colleagues, the opportunity to write and share these thoughts—and for the ongoing support and appreciation of readers… like you.

Wishing you and yours a very happy Thanksgiving!

- Nevin E. Adams, JD

Some Thanksgiving Thanks!

Thanksgiving has been called a “uniquely American” holiday, and while that may be something of an overstatement, it is unquestionably a special holiday, and one on which it seems appropriate to reflect on all for which we should be thankful.

So, as I look back at this past year:

• I’m thankful that so many employers voluntarily choose to offer a workplace retirement plan – and that so many workers, given an opportunity to participate, do.

• I’m thankful that a growing number of employers have chosen to automatically enroll valued workers into these programs, and that they are increasingly opting to establish a default contribution rate in excess of the “traditional” 3%.

• I’m thankful that the vast majority of workers defaulted into retirement savings programs tend to remain there – and that there are mechanisms (automatic enrollment, contribution acceleration and qualified default investment alternatives) in place to help them save and invest better than they might otherwise.

• I continue to be thankful that participants, by and large, continue to hang in there with their commitment to retirement savings, despite lingering economic uncertainty and competing financial priorities, such as rising health care costs and college debt.
  

• I’m thankful that more plan sponsors are making it easier for workers to participate in retirement savings programs, and automatically enrolling them sooner and at higher default contribution rates.

• I’m thankful for the strong savings and investment behaviors emerging among younger workers – and for the innovations in plan design and employer support that foster them. I’m thankful that, as powerful as those mechanisms are in encouraging positive savings behavior, we continue to look for ways to improve and enhance their influence(s).

• I’m thankful for qualified default investment alternatives that make it easy for participants to benefit from well-diversified and regularly rebalanced investment portfolios – and for the thoughtful and ongoing review of those options by prudent plan fiduciaries. I’m hopeful that the nuances of those glidepaths have been adequately explained to those who invest in them, and that those nearing retirement will be better served by those devices than many were a decade ago.

• I am thankful that powerful, impactful legislation like the SECURE Act can still pass the often-divided House of Representatives on a robust bipartisan basis – though I can’t help but be disappointed that, for the moment, anyway, the much-needed benefits have fallen prey to other matters.

• I'm thankful for the increase in contribution and benefit limits - so that those who can afford to set aside more for retirement can do so (as we all strive to help our retirement funding keep pace with the cost of living).

• I’m thankful for the development of our new Certified Plan Sponsor Professional(TM) credential, the support of our education partners in not only developing the program, but in partnering with us, and our various advisor networks to help distribute critical education to plan sponsors who, though tasked with an awesome task, are seldom provided the training or education commensurate with that responsibility. 

• I’m thankful that figuring out ways to expand access to workplace retirement plans remains, even now, a bipartisan focus – even if the ways to address it aren’t always.

• I’m thankful that the ongoing “plot” to kill the 401(k)… (still) hasn’t. Yet.

• I’m thankful to be part of a team that champions retirement savings – and to be a part of helping improve and enhance that system.

• I’m thankful that those who regulate our industry continue to seek the input of those in the industry – and that so many, particularly those among our membership, take the time and energy to provide that input.

• I’m thankful for all of you who have supported – and I hope benefited from – our various conferences, education programs and communications throughout the year.

• I’m thankful for the opportunity to acknowledge so many outstanding professionals in our industry through our Top Women Advisor, Top Young Retirement Advisor (“Aces”), Top DC Wholesaler (Wingmen), and Top DC Advisor Team lists. I am thankful for the blue-ribbon panels of judges that volunteer their time, perspective and expertise to those evaluations.

• I’m thankful for the warmth with which readers and members, both old and new, continue to embrace the work we do here.

• I’m thankful for the team at the American Retirement Association, and for the strength, commitment and diversity of the membership. I’m thankful to be part of a growing organization in an important industry at a critical time. I’m thankful to be able, in some small way, to make a difference.

 But most of all, I’m once again thankful for the unconditional love and patience of my family, the camaraderie of an expanding circle of dear friends and colleagues, the opportunity to write and share these thoughts — and for the ongoing support and appreciation of readers… like you.

Wishing you and yours a very happy Thanksgiving!

- Nevin E. Adams, JD

A ‘Retirement Ready’ Thanksgiving List

Thanksgiving has been called a “uniquely American” holiday, and though that is perhaps something of an overstatement, it is unquestionably a special holiday, and one on which it seems appropriate to reflect on all for which we should be thankful. And so…

I’m thankful that participants, by and large, continue to hang in there with their commitment to retirement savings, despite lingering economic uncertainty and competing financial priorities, such as rising health care costs and college debt.

I’m thankful that so many employers voluntarily choose to offer a workplace retirement plan – and that so many workers, when given an opportunity to participate, do.

I’m thankful that figuring out ways to expand that access remains, even now, a bipartisan concern – even if the ways to address it aren’t always.

I’m thankful that so many employers choose to match contributions or to make profit-sharing contributions (or both), for without those matching dollars, many workers would likely not participate or contribute at their current levels – and they would surely have far less set aside for retirement.

I’m thankful that the vast majority of workers defaulted into retirement savings programs tend to remain there – and that there are mechanisms (automatic enrollment, contribution acceleration and qualified default investment alternatives) in place to help them save and invest better than they might otherwise.

I’m thankful that a growing number of plan sponsors are choosing to improve on those automatic defaults, particularly by raising the starting contribution rates.

I’m thankful that more plan sponsors are extending those mechanisms to their existing workers as well as new hires.

I’m thankful for qualified default investment alternatives that make it easy for participants to create well-diversified and regularly rebalanced investment portfolios – and for the thoughtful and on-going review of those options by prudent plan fiduciaries.

I’m thankful that, as powerful as those mechanisms are in encouraging positive savings behavior, we continue to look for ways to improve and enhance their influence(s).

I’m thankful that a growing number of policy makers are willing to admit that the “deferred” nature of 401(k) tax preferences are, in fact, different from the permanent forbearance of other tax “preferences” – even if governmental accountants and certain academics remain oblivious.

I’m thankful that the “plot” to kill the 401(k)… (still) hasn’t. Yet.

I’m thankful that those who regulate our industry continue to seek the input of those in the industry – and that so many, particularly those among our membership, take the time and energy to provide that input.

I’m thankful for objective research that validates the positive impact that committed planning and preparation for retirement makes. I’m thankful for the ability to take to task here research that doesn’t live up to those objective standards – and for those who take the time to share those findings.

I’m thankful for all of you who have supported – and I hope benefited from – our various conferences, education programs and communications throughout the year.

I’m thankful for the team here at the American Retirement Association, generally, as well as all the sister associations - ASPPA, ACOPA, NTSA, NAPA and PSCA, and for the strength, commitment and expanding diversity of our membership.

I’m thankful to be part of a growing organization in an important industry at a critical time. I’m thankful to be able, in some small way, to make a difference.

But most of all, I’m once again thankful for the unconditional love and patience of my family, the camaraderie of dear friends and colleagues, the opportunity to write and share these thoughts – and for the ongoing support and appreciation of readers like you.

Here’s wishing you and yours a very happy Thanksgiving!

- Nevin E. Adams, JD

A Thankful Thanksgiving

Thanksgiving has been called a “uniquely American” holiday, and though that is perhaps something of an overstatement, it is unquestionably a special holiday, and one on which it seems appropriate to reflect on all for which we should be thankful.

Here’s my list for 2017:

I am thankful that – for the moment, anyway – it looks as though retirement savings will be largely spared tax reform’s ravages (though I’m not convinced that we’re out of the woods – yet). 

I’m thankful that participants, by and large, continue to hang in there with their commitment to retirement savings, despite lingering economic uncertainty and competing financial priorities, such as rising health care costs and college debt.

I’m thankful for the strong savings and investment behaviors emerging among younger workers – and for the innovations in plan design and employer support that foster them. I’m thankful that, as powerful as those mechanisms are in encouraging positive savings behavior, we continue to look for ways to improve and enhance their influence(s).

I’m thankful for qualified default investment alternatives that make it easy for participants to create well-diversified and regularly rebalanced investment portfolios — and for the thoughtful and on-going review of those options by prudent plan fiduciaries.

I’m thankful that those reviews are guided, in a growing number of situations, by the thoughtful input of advisors who are ERISA fiduciaries.

I’m thankful that so many employers voluntarily choose to offer a workplace retirement plan — and that so many workers, given an opportunity to participate, do.

I’m thankful that the vast majority of workers defaulted into retirement savings programs tend to remain there — and that there are mechanisms (automatic enrollment, contribution acceleration and qualified default investment alternatives) in place to help them save and invest better than they might otherwise.

I’m thankful that figuring out ways to expand access to workplace retirement plans remains, even now, a bipartisan focus – even if the ways to address it aren’t always.

I’m thankful that so many employers choose to match contributions or to make profit-sharing contributions (or both), for without those matching dollars, many workers would likely not participate or contribute at their current levels — and they would surely have far less set aside for retirement.

I’m thankful that the on-going “plot” to kill the 401(k)… still hasn’t. Yet.

I’m thankful to be part of a team that champions retirement savings – and to be a part of helping improve and enhance that system.

I’m thankful that those who regulate our industry continue to seek the input of those in the industry — and that so many, particularly those among our membership, take the time and energy to provide that input.

I’m thankful for all of you who have supported – and I hope benefited from – our various conferences, education programs and communications throughout the year.

I’m thankful for the constant – and enthusiastic – support of our Firm Partners and advertisers.

I’m thankful for the warmth with which readers and members, both old and new, continue to embrace the work we do here.

I’m thankful for the opportunity to acknowledge so many outstanding professionals in our industry through our Top Women Advisor, Top Young Advisor (Young Guns) and Top DC Wholesaler (Wingmen) lists. And thankful to have had such a tremendous response to the newest addition here - our Top DC Advisor Team list.
 
I am thankful for the blue-ribbon panels of judges that bring so much expertise and insight to those evaluations.

I’m thankful for the prospect of expanding the reach and impact of our work here to plan sponsors via the contemplated combination with the Plan Sponsor Council of America.

I’m thankful to be part of a growing organization in an important industry at a critical time. I’m thankful to be able, in some small way, to make a difference.

But most of all, I’m once again thankful for the unconditional love and patience of my family, the camaraderie of an expanding circle of dear friends and colleagues, the opportunity to write and share these thoughts — and for the ongoing support and appreciation of readers…like you.

Thanks for all you do to help make our nation’s retirements better.  

Have a VERY happy Thanksgiving!

- Nevin E. Adams, JD

Why Your Recordkeeper Might Not Be an Automatic Enrollment Fan

I recently wrote about what’s wrong with automatic enrollment. Turns out there’s more – and it has to do with when things actually go “wrong” with automatic enrollment.

See, it’s one thing to say that eligible employees should be automatically enrolled – and yet another to actually get them enrolled automatically. Even the Internal Revenue Service (IRS) goes so far as to acknowledge that two common errors found in 401(k) plans are: (1) not giving an eligible employee the opportunity to make elective contributions; and (2) failing to execute an employee’s salary deferral election.

Now, as it turns out, both are “fixable” – through the Employee Plans Compliance Resolution System (EPCRS). But that’s only the start of things. See, in both of those situations you’re looking at a corrective contribution of 50% of the missed deferral (adjusted for earnings) for the affected employee. And then fully vesting the employee in those contributions – contributions that are subject to the same restrictions on withdrawal that apply to elective deferrals.

The only difference in the correction for the two situations outlined is the calculation of the amount of the missed deferral. In the case of an erroneously excluded employee, the missed deferral is based on the average of the deferral percentages (ADPs) for other employees in the employee’s category (for example, non-highly compensated employees), whereas if the error involves failing to implement an employee’s election, the missed deferral is based on the employee’s elected deferral percentage, or in the case of missed automatic contributions, the automatic contribution percentage. For plans with automatic contributions, however, the corrective contribution for the missed deferrals is reduced to 0% or 25% of the missed deferrals, depending upon how soon the error is corrected.

Your head starting to hurt?

Hold on – those corrective contributions also need to be adjusted for earnings – from the date that the elective deferrals should have been made through the date of the corrective contribution.1 In all cases the employer must contribute any missed matching contributions, adjusted for earnings.

‘Tell’ Tales

Now, in addition to the regular array of plan notices that will now be required for those new participants, automatic enrollment has its own special set of notices. While most larger plans rely on what is called an eligible automatic contribution arrangement (EACA), smaller programs may have in place what is called a qualified automatic contribution arrangement (QACA), a type of automatic enrollment 401(k) plan that automatically passes certain kinds of annual required testing (generally referred to as a safe harbor plan). A QACA must include certain features, such as a fixed schedule of automatic employee contributions, employer contributions, a special vesting schedule and specific notice requirements.

The automatic enrollment notice details the plan’s automatic enrollment process and participant rights. The notice must specify the deferral percentage, the participant’s right to change that percentage or not to make automatic contributions, and the default investment. The participant generally must receive the initial notice at least 30 days, but not more than 90 days, before eligibility to participate in the plan or the first investment. Subject to certain conditions, the notice may be provided, and an employee may be enrolled in the plan, on the first day of work. An annual notice must be provided to participants and all eligible employees at least 30 days, but not more than 90 days, prior to the beginning of each subsequent plan year. And guess what happens if those notices don’t go out when they are supposed to?

So, it’s not as though you just have to flip a switch on payroll and you’re done.

Even When It Works

There are, of course, issues, even if there are no processing missteps. Cost, particularly as it relates to the match – which may have been designed to encourage workers to sign up, and which, with automatic enrollment, may no longer need to – and which may have been budgeted for a 70% participation rate that, thanks to automatic enrollment, may be more like 95%. Turnover can leave behind smaller 401(k) balances, which incur additional recordkeeping costs, and which can prove to be a real administrative burden with ongoing notice and communication requirements. Which again, if those notices aren’t going out when they should…

The bottom line is that automatic enrollment is an important component of helping more Americans save, and save effectively. But as is often the case, it’s not as easy as it sounds, and plan sponsors looking to embrace this design – and advisors who tout it – should do so with a full awareness and appreciation of all the implications.

For some other issues, see “Why Doesn’t Every Plan Have Automatic Enrollment?”

Nevin E. Adams, JD

1. Not that that’s not an improvement from how it used to be. Under Rev. Proc. 2015-28, if the error is detected within 9½ months after the year of the failure, no corrective qualified non-elective contribution (QNEC) is required to an affected participant’s account for the missed deferral opportunity, as long as the person is enrolled within the 9½ month period (or earlier if the affected employee notifies the employer of the mistake).

A ‘Retirement Ready’ Thanksgiving List

Thanksgiving has been called a “uniquely American” holiday, and though that is perhaps something of an overstatement, it is unquestionably a special holiday, and one on which it seems appropriate to reflect on all for which we should be thankful.

Here’s my 2016 list:

I’m thankful that participants, by and large, continue to hang in there with their commitment to retirement savings, despite lingering economic uncertainty and competing financial priorities, such as rising health care costs and college debt.

I’m thankful that so many employers voluntarily choose to offer a workplace retirement plan — and that so many workers, when given an opportunity to participate, do.

I’m thankful that figuring out ways to expand that access remains, even now, a bipartisan concern – even if the ways to address it aren’t always.

I’m thankful that so many employers choose to match contributions or to make profit-sharing contributions (or both), for without those matching dollars, many workers would likely not participate or contribute at their current levels — and they would surely have far less set aside for retirement.

I’m thankful that the vast majority of workers defaulted into retirement savings programs tend to remain there — and that there are mechanisms (automatic enrollment, contribution acceleration and qualified default investment alternatives) in place to help them save and invest better than they might otherwise.

I’m thankful that more plan sponsors are extending those mechanisms to their existing workers as well as new hires.

I’m thankful for qualified default investment alternatives that make it easy for participants to create well-diversified and regularly rebalanced investment portfolios — and for the thoughtful and on-going review of those options by prudent plan fiduciaries.

I’m thankful that, as powerful as those mechanisms are in encouraging positive savings behavior, we continue to look for ways to improve and enhance their influence(s).

I’m thankful that a growing number of policy makers are willing to admit that the “deferred” nature of 401(k) tax preferences are, in fact, different from the permanent forbearance of other tax “preferences” — even if governmental accountants and certain academics remain oblivious.

I’m thankful that the “plot” to kill the 401(k)… (still) hasn’t. Yet.

I’m thankful that those who regulate our industry continue to seek the input of those in the industry — and that so many, particularly those among our membership, take the time and energy to provide that input.

I’m thankful for objective research that validates the positive impact that committed planning and preparation for retirement makes. I’m thankful for the ability to take to task here research that doesn’t live up to those objective standards – and for those who take the time to share those findings.

I’m thankful for all of you who have supported – and I hope benefited from – our various conferences, education programs and communications throughout the year.

I’m thankful for the constant – and enthusiastic – support of our Firm Partners and advertisers.

I’m thankful for the warmth with which readers and members, both old and new, continue to embrace the work we do here.

I’m thankful for the team here at NAPA (and the American Retirement Association, generally, as well as all the sister associations), and for the strength, commitment and diversity of the membership. I’m thankful to be part of a growing organization in an important industry at a critical time. I’m thankful to be able, in some small way, to make a difference.

But most of all, I’m once again thankful for the unconditional love and patience of my family, the camaraderie of dear friends and colleagues, the opportunity to write and share these thoughts — and for the ongoing support and appreciation of readers like you.

Here’s wishing you and yours a very happy Thanksgiving!

- Nevin E. Adams, JD