Hey, plan sponsors: Imagine for a moment that your active participants are Tom Cruise from Mission: Impossible (or Barbara Bain, Peter Graves and Martin Landau, for those of us who remember the classic TV series).

Have you ever received a letter with the notice “Time Sensitive Material! Open Immediately!” boldly splashed across the outside of the envelope, only to sigh with disappointment with what’s on the inside?  While the disappointment of false advertising so often seems to be the case with “junk mail,” the warning turns out to be true when we examine the behaviors of retirement plan participants who have recently changed jobs.

Why should plans care about roll-in contributions? Establishing a program that encourages participant rollover contributions (or “roll-ins”) is one of the most beneficial programs that a plan can implement.

With the advent of the Department of Labor's Fiduciary Rule, more employers are looking to promote lifetime plan participation and encourage participants to consolidate retirement assets in their current, active 401(k) plan. The plan feature to enable consolidation in the active 401(k) plan is the roll-in contribution. Retirement Clearinghouse is the recognized thought leader in roll-in facilitation.  We have prepared this video - The ABCs of Roll-Ins -- as a resource for plan sponsors who are considering a formal roll-in program, as well as offering a roll-in facilitation service for their plan participants. 

According to the recently released 2016 Willis Towers Watson U.S. Retirement Governance Survey, a major trend in retirement plan governance is the growing concern employers have for employees’ retirement benefit adequacy and financial well-being. To address this concern, sponsors indicated plans to increase monitoring of participant behaviors, using metrics such as plan participation and contribution rates, as well as carefully tracking the performance of their plans’ investment managers.

In his most recent article in MarketWatch, RCH’s Spencer Williams cites the recent market trauma experienced in the wake of the United Kingdom’s decision to exit the European Union (“Brexit”) as a good reason for retirement-savers to consolidate their accounts.

In the first half of 2016, not only has the retirement industry awakened to the problem of cashout leakage, but it’s begun to acknowledge its root cause: a lack of retirement savings portability. At the same time, Auto Portability has emerged as the only viable solution to cashout leakage, delivering portability for the small-balance (less than $5,000) job-changer, automatically moving their balances forward when they change jobs and enroll in a new plan.

In the wake of the Fiduciary Rule, providers of all stripes are broadly reevaluating their strategies for the participant and asset retention that is essential to growing their retirement plan businesses. Over the past two decades, providers have primarily looked to capture IRA rollovers as a means to grow retirement assets. The Department of Labor’s new Fiduciary Rule creates challenges to that model. However, there is another, largely untapped, pool of assets within providers’ reach that can fuel growth—premature cash-outs. Auto portability, and portability solutions in general, represent a new and unique way to tap that potential source of growth.

In his 6/30/16 MarketWatch article, RCH President and CEO Spencer Williams suggests an inter-generational dialogue on the pitfalls to avoid when saving for retirement.

 On June 8^th, 2016 Retirement Clearinghouse (RCH) and the Employee Benefit Research Institute (EBRI) teamed up to present consolidated testimony to the ERISA Advisory Council on Auto Portability,  the automation of plan-to-plan transfers for small accounts, when participants change jobs.