PLANSPONSOR - August/September 2019 - 6

Survey Says
The
SECURE
Act and
Income
Adequacy
W
e asked NewsDash readers
whether they think provisions
of the Setting
Every Community Up for Retirement
Enhancement (SECURE) Act will
improve retirement income adequacy for
Americans. Provisions of the act include:
allowing unrelated plan sponsors to band
together in " open " multiple employer
plans (MEPs); changing the age at which
participants must take a minimum distribution
from 70 1/2 to 72; and adding
a safe harbor that lets sponsors select a
lifetime income provider in order to offer
annuities in their retirement plan.
Only 21.9% of respondents said
raising the required minimum distribution
(RMD) age will improve income
adequacy, while 62.5% said they do not
think it would, and 15.6% chose " don't
know/no opinion. " Just a shade past
30%-31.2%-said a new safe harbor
Will Changing the RMD Age
From 70 1/2 to 72 Improve
Americans' Retirement
Income Adequacy?
62.5%
No, it
will not
improve
it
21.9%
Yes, it will
improve it
15.6%
Don't know
would help with income adequacy;
59.4% said no; and 9.4% were unsure or
had no opinion.
All verbatim responses to the survey
reflect the opinions of individual readers
and not the stance of PLANSPONSOR or
its affiliates at Institutional Shareholder
Services Inc. (ISS).
" There is no need to add an annuity
offering to a plan. Participants can currently
select an annuity provider of their own
choice to roll their distribution to. Raising
the RMD to 72 will only allow the wealthy to
defer the RMD longer. "
" There are always unforeseen consequences.
The SECURE Act is at least an
attempt to recognize the reality that DC
[defined contribution] plans will be the
primary source of retirement income for
most Americans. "
" Moving the RMD age to 72 makes
sense. The original requirement was set at
a time when life expectancies were shorter
than today, and many people are working
longer than during previous generations. "
" While I did select 'yes' for all of the
questions, those changes will help only
minimally. Why not eliminate RMDs
altogether? I wish the act included more
significant changes. "
" Good intent, but piecemeal and
tedious regulations. Best idea: Require a core
financial education class in high school to
get everyone started right. "
" No annuity will help if you don't have
enough money in the plan. Raise contribution
caps. Provide education to high school
students on the importance of saving.
Remove regulations and make plans simple
for any employer to offer. Design a 'safe
harbor' plan that any employer can pick
up and use; no attorneys or consultants
needed. That would be a big step in the
right direction. "
" The MEPs may allow a few more
people into retirement plans, but that does
not change the fundamental issue of: People
do not save enough to be prepared. "
" Though the act seems to help on the
surface, it just makes things more complicated
for administrators. "
And the Editor's Choice goes to the
reader who said: " At the end of the day, it
comes down to the participants and their
savings ability to defer and to not touch the
money they are saving. " -Rebecca Moore
You can participate by subscribing to NewsDash at plansponsor.com/subscribe.
6 PLANSPONSOR.com August - September 2019 Art by Andrea Chronopoulos

http://www.plansponsordigital.com/plansponsor/august-september_2019/TrackLink.action?pageName=6&exitLink=http%3A%2F%2Fplansponsor.com%2Fsubscribe http://www.plansponsordigital.com/plansponsor/august-september_2019/TrackLink.action?pageName=6&exitLink=http%3A%2F%2FPLANSPONSOR.com

PLANSPONSOR - August/September 2019

Table of Contents for the Digital Edition of PLANSPONSOR - August/September 2019