Lifetime Income Illustrations: Preparing Committees for This SECURE Act Requirement

Benefits and executive compensation partner Fred Reish and counsel Joan Neri coauthored an article for PLANADVISER in which they describe the Setting Every Community Up for Retirement Enhancement (SECURE) Act requirement and what advisers should highlight for plan committees.

Reish and Neri were asked, “I’m a registered investment adviser (RIA) who advises 401(k) plan committees. I know that the SECURE Act included a requirement that 401(k) plans provide participants with annual lifetime income illustrations. When does that rule apply, and what should I be telling plan committees about that obligation?”

In response, the authors detailed how the first of the annual lifetime income illustrations must be provided in participant benefit statements after September 18 and noted several considerations that RIAs should highlight to plan committees. They also explained the role of the plan committee under the Employee Retirement Security Act (ERISA) and addressed Department of Labor guidance, which is in an interim final regulation.

The authors further stated that committees should consider the impact of the mandated illustrations on participants and ways by which the plan can support participant needs, including participant education, expanded plan distribution options and gap analysis services. Overall, they recommended that RIAs discuss these issues and additional services with their plan committees.

The full article is available for PLANADVISER subscribers.