IRA Provider Insights

The State Run IRA Opportunity Part 5: Employer Opinions on City and State IRAs

Posted by Mark Fleckenstein on Aug 3, 2017 10:41:34 AM

As it turns out, small businesses like the idea of being mandated into offering a retirement plan. They just wish it was being done differently.

 

Lost in all of the legislative tedium of these government-run retirement options are the actual feelings of the entities that will be most impacted: Small- and medium-sized business owners.5.png

As it turns out, these business owners fully support the idea of Auto-IRA plans. They just have little faith in the government properly operating such a plan:

86% of SMB owners somewhat support or strongly support Automatic IRA Plans.

82% of SMB owners prefer a mutual fund or insurance company to administer their plan.

55% of DC Plan Sponsors are likely to stop offering a DC Plan in favor of a State Plan due to cost savings.

As these numbers suggest, these employers want to offer their employees a plan, but they want to do it on their terms. That begs the question: Is the retirement industry ready to provide what these companies are looking for?

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Data from The Pew Charitable Issue Brief, Small Business Views on Retirement Savings Plans, January 11, 2017.

Topics: Payroll IRA Programs for Payroll Companies, State Run IRAs, state-run retirement, Payroll IRAs