Consolidation Corner

Incubate Small Retirement Accounts, Don’t Throw Them Away

Posted by Neal Ringquist on Feb 16, 2017 11:30:00 AM


On February 3rd, the U.S. Chamber of Commerce, the world’s largest business federation representing the interests of more than 3 million businesses, released Securing America’s Retirement, their legislative roadmap aimed at strengthening the U.S. retirement system.


The Chamber’s goals are admirable:

“To address the needs of our nation’s shifting workforce, reduce barriers small businesses face in developing retirement plans, and make it easier for all Americans to save for their future…” 


The roadmap details policy solution proposals that Congress can act upon to achieve better retirement security for workers in the small business sector.  Improving retirement security for the small business sector is sorely-needed, as only 14% of companies with less than 100 employees – representing 34% of private sector payrolls -- offer their employees access to a retirement plan.  


In general, the majority of the Chamber’s agenda should be well-received, and appears to be well-vetted.  However, one policy proposal – increasing the mandatory cash-out limit to $10,000 – could have significant, unintended and adverse consequences for retirement security, if implemented without additional safeguards. 

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Topics: Auto Portability, Mandatory Distributions, Automatic Rollovers, 401(k) Consolidation, Cash Outs, Auto Enrollment, Automatic Rollover

Uncashed Distribution Checks: An Ounce of Prevention is Worth a Pound of Cure

Posted by Thomas Hawkins on Feb 9, 2017 2:17:10 PM


Now that we’re in the thick of flu season, we’re reminded of Ben Franklin’s famous axiom: “an ounce of prevention is worth a pound of cure.”  A yearly flu shot is perhaps the best example of an effective, preventative action you can take to minimize your odds of catching the flu, and keep you breathing more easily than those who haven’t.


Similarly, retirement plan sponsors can take preventative steps to minimize the incidence of uncashed distribution checks, as well as to resolve the situations that inevitably occur.

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Topics: Uncashed Check Services, Stale Dated Checks, Uncashed Distribution Checks

One Small Improvement for 401(k) Plans, One Giant Leap for Retirement Readiness

Posted by Neal Ringquist on Feb 2, 2017 6:31:28 PM

Baby boomers will never forget Neil Armstrong’s famous quote in 1969, after becoming the first human being to set foot on the moon:

“That’s one small step for (a) man, one giant leap for mankind.”

Today, America faces a different, more down-to-earth challenge: delivering our citizens a comfortable and timely retirement. And similar to the moon landing – a ‘small step’ in the right direction can have a huge impact on the course of our lives.

A Focus on 401(k) Plan Deficiencies

At no time has our retirement challenge been more evident than during the first few weeks of 2017, with multiple articles pointing out deficiencies of 401(k) plans as the primary vehicle for retirement savings.

Much of the focus for improving the 401(k) system has been on increasing participation, and statistics indicate that this concern is well-founded. Unfortunately, scant attention has been paid to plugging retirement plan leakage, particularly cash out leakage – a problem that drains our retirement system of billions of dollars annually.

There is one solution – auto portability – that has the potential to plug cash out leakage and increase 401(k) plan participation. If fully implemented, auto portability could drive significant improvements in our nation’s retirement readiness. And unlike a manned mission to the moon, auto portability can be delivered by the private sector, at no cost to the American taxpayer.

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Topics: Auto Portability, 401(k) Consolidation

Auto Portability Simulation (APS)

Posted by Spencer Williams on Jan 24, 2017 1:44:02 PM


This video presentation is designed to give the viewer a basic understanding of the Auto Portability Simulation (APS), which models the operation and benefits of Auto Portability.


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Topics: Auto Portability, RCH Services

How to Remove 'Friction' from the 401(k) System

Posted by Thomas Hawkins on Jan 24, 2017 8:10:00 AM

In consolidated testimony before the ERISA Advisory Council  on the topic of Participant Plan Transfers and Account Consolidation for the Advancement of Lifetime Plan Participation, EBRI’s Craig Copeland and Retirement Clearinghouse’s Tom Johnson presented “Auto Portability Research & Simulation: Automating Plan-to-Plan Transfers for Small Accounts” – providing the Council with the latest information & research on Auto Portability, as well as describing the present state of plan-to-plan transfers (“roll-ins”).

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Topics: Auto Portability, 401(k) Consolidation, Managed Portability, Roll-In, Retirement Savings Portability

The ABCs of Auto Portability

Posted by Thomas Hawkins on Jan 19, 2017 3:53:20 PM



This video presentation is designed to give the viewer a basic understanding of Auto Portability.


What is Auto Portability?

Auto Portability is:

  • The routine, standardized and automated movement of an inactive participant’s retirement account from a former employer’s retirement plan to their active account in a new employer’s plan. 
  • Serves the needs of participants subject to mandatory distribution provisions of their employer-sponsored plan (separated participants with account balances less than $5,000) to curb excessive cash out leakage occurring as participants change jobs.
  • Could be adapted to larger account balances, should public policy dictate a higher mandatory distribution limit.


Why is Auto Portability needed?

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Topics: Auto Portability, Managed Portability, Roll-In, Lifetime Plan Participation, Retirement Savings Portability, Thought Leadership, PSCA, Participant transition management

LIMRA's Secure Retirement Institute Features Auto Portability Research

Posted by Thomas Johnson on Jan 18, 2017 5:31:32 PM



This January, LIMRA’s Secure Retirement Institute is promoting their research on Auto Portability, which contains an impressive array of information.


Entitled “DConversations – Automatic Portability: A New Approach to Addressing Retirement Plan Leakage” – the research includes:

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Topics: Auto Portability, Roll-In, Leakage, LIMRA

This Year, Resolve to Debunk Two Common Retirement-Saving Myths for Participants

Posted by Spencer Williams on Jan 13, 2017 7:17:00 AM


“A lie can travel halfway around the world while the truth is still putting on its shoes” is a quote often attributed to Mark Twain. The same is true of myths about saving for retirement, and retirement services professionals should take it to heart as we begin 2017.

Many plan participants hold misconceptions about saving for retirement. Plan sponsors and record-keepers regularly demonstrate their commitment to fiduciary responsibilityby actively working to dispel these myths, which can potentially prevent participants from achieving their desired retirement outcomes.

Here are two common misperceptions that sponsors and record-keepers should seek to bust in 2017:

  • “You’re On Your Own When You Change Jobs.”


This is patently false, but too many participants assume they have no recourse if they wish to move their retirement savings forward to their new-employer plan.As this diagram makes all too clear, plan-to-plan portability is a complex and time-consuming process if participants undertake it on their own.


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Topics: EBN, Auto Portability, 401(k) Consolidation, Retirement Plan Portability, Retirement Savings Portability

Retirement Clearinghouse’s Logo is Changing: Here’s Why

Posted by Spencer Williams on Jan 3, 2017 2:05:22 PM


Beginning today, and in the coming weeks ahead, Retirement Clearinghouse will be rolling out our new corporate logo, as part of the ongoing evolution of our retirement savings portability services.


Reasons for the Change

Since February 2013, when we announced our rebranding to Retirement Clearinghouse (RCH), we’ve had a singular focus on offering retirement savings portability solutions that 1) minimize cashout leakage and 2) move retirement savings forward when participants change jobs. 


Our goal has been nothing short of revolutionizing the processes that occur for retirement savers, post job-change.  RCH’s services have been proven successful in reducing leakage by over 50%, and since 2013 we’ve invested considerable time and energy in bringing auto portability to America’s defined contribution system. 

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Topics: Auto Portability, RCH Services

Changing Jobs in 2017? Take Your Retirement Savings With You

Posted by Neal Ringquist on Jan 3, 2017 11:41:39 AM


In his latest article in MarketWatch, posted on New Year’s Eve, RCH President, CEO and RetireMentor Spencer Williams counsels those who switched jobs in 2016 to make their New Year’s resolutions to roll-in all of their retirement savings accounts – not just the account in their most recent prior-employer plan – into their new-employer plan.


For any account that’s not yet rolled in to a current-employer plan, Williams strongly urges that savers update their current contact details.

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Topics: MarketWatch, 401(k) Consolidation, Managed Portability, Roll-In, Participant transition management, assisted roll-in

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