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Financial Planning

Securing the Future of Retirement

Deb Rubin


Why It Matters:

  • The SECURE Act’s passage will help expand retirement plan coverage and improve options available to small businesses.

  • Workplace retirement plans provide one of the best opportunities for Americans to invest in their financial future.

  • Transamerica can help you get ahead of the curve with innovative pooled plan solutions.

In these unprecedented times of COVID-19, I’d like to shine light on something near and dear to my heart — retirement. Workplace retirement plans are a critical piece of the financial planning puzzle, and perhaps one of the easiest ways to help American workers secure a healthier financial future.

While current events have created significant financial uncertainty for many, I’m confident that helping more workers prepare for retirement will become easier and more accessible in the next year.

Changing the game

Late last year, I provided input and recommendations for legislative provisions to the IRS that were included in the Setting Every Community Up for Retirement Enhancement (SECURE) Act. I specifically focused on how to allow more small businesses to offer affordable, effective retirement plans through open multiple employer plans.

Two weeks after I attended the IRS hearing, the bill passed Congress with overwhelming —and rare — bipartisan support.

The SECURE Act's 30 provisions are designed to help more American workers invest in their futures, and include the following changes specific to pooled plan arrangements:

Pooled Employer Plans (PEPs)

The SECURE Act expands the number of quality, affordable retirement options available to small businesses by allowing unrelated employers to join together in a pooled employer plan (PEP). The PEP, an updated version of an “open MEP,” will make it easier for business owners to offer higher quality plans at lower costs — with reduced fiduciary and administrative responsibility.

It also removes the harsh “one bad apple” rule, where one employer in a MEP can potentially disqualify an entire MEP by violating its tax rules. While everyone at the IRS hearing noted having a “bad apple” adopter is rare, the question we asked was: How many potential employers do not join a MEP because of this concern?

Some of the bill's provisions don't go into effect until 2021, but it’s important to start planning for these changes now. I’m thrilled to be part of a company that currently has innovative pooled plan solutions for employers. Our Retirement Plan Exchange® has been validated and enhanced by the SECURE Act, and is available now.

In uncertain times like these, I’m reminded of the positive impact we can have on the lives of Americans. And I’m proud to work in an industry that’s making retirement planning more accessible than ever.

Things to Consider:

  • Transamerica is a leader in pooled plan arrangements with nearly 20 years of experience.
  • MEPs and beginning in 2021, PEPS, can offer an affordable solution for small businesses.
  • MEPs, PEPs, the Retirement Plan Exchange: we have the expertise to help you determine which type of pooled plan arrangement may be the best fit for your client.

Information regarding retirement plans is general and is not intended as legal or tax advice. Retirement plans are complex, and the federal and state laws or regulations on which they are based vary for each type of plan and are subject to change. In addition, some products, investment vehicles, and services may not be available or appropriate in all workplace retirement plans. Plan sponsors and plan administrators may wish to seek the advice of legal counsel or a tax professional to address their specific situations.

Retirement Plan Exchange® is a registered service mark of Transamerica. The Exchange is not a multiple employer plan (MEP). Unlike a MEP, certain plan qualification and ERISA requirements are applied at the individual plan level. An employer participating in an Exchange retains certain fiduciary responsibilities, including responsibility for retaining and monitoring the 3(16) plan administrator, for determining the reasonableness of its fees, and for periodically reviewing the Exchange as a whole. 

Pooled employer plans (PEPs) are a new type of multiple employer plan for which the Department of Labor (DOL) and IRS guidance is still pending in a number of areas.  An employer participating in a PEP retains certain fiduciary responsibilities, including responsibility for retaining and monitoring the 3(16) plan administrator, for determining the reasonableness of its fees, and for periodically reviewing the plan as a whole.

Deb Rubin is a registered representative of Transamerica Investors Securities Corporation (TISC), member FINRA, 440 Mamaroneck Avenue, Harrison, NY 10528. All Transamerica companies identified are affiliated.

Neither Transamerica nor its agents or representatives may provide tax or legal advice.  Anyone to whom this material is promoted, marketed, or recommended should consult with and rely on their own independent tax and legal professionals regarding their particular situation and the concepts presented herein.

Transamerica Resources, Inc. is an Aegon company and is affiliated with various companies which include, but are not limited to, insurance companies and broker-dealers. Transamerica Resources, Inc. does not offer insurance products or securities. The information provided is for educational purposes only and should not be construed as insurance, securities, ERISA, tax, investment, legal, medical or financial advice or guidance. Please consult your personal independent professionals for answers to your specific questions.