White House Retirement Plan Budget Fizzles Flat with Pros
The new White House budget contained many retirement plan items intended to “solve” the retirement savings problem. But, according to many experienced professionals, these appear to have missed the greater point that the vast bulk of the proposed “solutions” either ignore the current reality of the retirement plan landscape or, worse, are trying to solve the wrong problem. Source: Fiduciarynews.com
Key Article Quotations:
“The IRS and the DOL make it too expensive for companies to sponsor plans… “The rules are overly complex and the audit practices of both agencies is to make money off mistakes that are the fault of service providers and not the plan sponsor” (Harley L. Bjelland, an ERISA attorney located in Orange, California).
“The problem isn’t with the options, but in people’s behavior in participating in them. Whether it’s a company-sponsored program like a 401k or a self-directed traditional IRA, investors haven’t developed disciplined saving habits, which leads to poor levels of participation, and often ‘late’ participation jeopardizing a successful retirement” (Victor J. Medina, founder of the Medina Law Group and Private Client Capital Group in Pennington, New Jersey).
“The White House mentioned in their January 26th press statement Building a 21stCentury Retirement System that a MEP will offer ‘benefits through the same administrative structure but with lower costs and less compliance burden.’ Why don’t we ask Congress to decrease the compliance burden, so small businesses can run their own plan” (Matthew Haywood, Retirement Plan Advisor with Krilogy Financial in St. Louis, Missouri)?
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