Millions and Counting: How the SAFE Act Aims to Protect the Future of More Americans
Safety is often thought about in terms of the present: keeping children out of harm’s way, protecting family, wearing a seat belt…the list could go on forever. But, how often do we ask ourselves, how is the safety of my financial future?
Employer sponsored 401(k) plans and other work site retirement plans have helped millions of workers save trillions of dollars. These dollars not only help create security, but also peace of mind that medicine can be paid for and unforeseen situations can be taken care of. And most importantly, these dollars help ensure quality of life can be sustained long after retirement.
Title II of the Secure Annuities for Employee (SAFE) Retirement Act of 2013 aims to provide more of this security by increasing retirement plan coverage and simplifying operations for privately-sponsored plans. Title II of the Act covers the key challenges that need to be addressed in the private retirement system to protect all Americans’ financial futures by:
- Expanding coverage of employees in voluntary, employer-sponsored retirement plans,
- Increasing retirement savings to adequate levels, and
- Securing income to last through retirement.
What does this mean for advisors?
The changes proposed by Title II of the Act aim to establish new “Starter 401(k)s” providing more opportunities for you to grow your practice in the small plan market where new plan formation is vital to expanding retirement coverage for American workers. The Act also seeks to provide more flexibility for existing plan sponsors in adopting plan provisions and products intended to drive savings levels higher and secure guaranteed income in retirement. This translates to more opportunities for you to provide plan design consultation to your clients.
So, even if we may not always have the foresight to ask ourselves about the safety of our financial future, it is a question the SAFE Retirement Act is focused on answering.
While this communication may be used to promote or market a transaction or an idea that is discussed in the publication, it is intended to provide general information about the subject matter covered and is provided with the understanding that none of the member companies of The Principal are rendering legal, accounting, or tax advice. It is not a marketed opinion and may not be used to avoid penalties under the Internal Revenue Code. You should consult with appropriate counsel or other advisors on all matters pertaining to legal, tax, or accounting obligations and requirements.
Insurance products and plan administrative services are provided by Principal Life Insurance Company. Securities are offered through Princor Financial Services Corporation, 1-800-547-7754, Member SIPC and/or independent broker dealers. Securities sold by a Princor® Registered Representative are offered through Princor. Princor and Principal Life are members of the Principal Financial Group® (The Principal®), Des Moines, IA 50392.
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