In a meeting with a plan committee yesterday, we asked about the plan’s primary purpose. Have you discussed that question within your committee or trustee meetings? If so, it’s likely that the answer has begun to shift over the last few years. The old answer was fairly uniform: “to attract and retain employees”. And although that continues to be a purpose, an increasing number of plan sponsors are providing the answer we heard yesterday: “to ensure our employees have enough money to retire”.
J.P.Morgan’s 2017 Defined Contribution Plan Sponsor Survey asked plan sponsors to identify the main reason for offering their respective plans. The number who responded with “Ensuring sufficient income in retirement” doubled (from 12% to 24%) in only four years. That helps us to see a change in the philosophy behind offering and maintaining plans. Of course it’s also important to see whether plan sponsors are making the changes necessary in order to accomplish the stated goal. The survey indicates they are:
  • Automatic enrollment utilization continues to increase;
  • More companies are also using automatic escalation; and
  • Support for re-enrollment is increasing.
If you’ve not asked yourself – or been asked – about your plan’s primary purpose(s), we recommend this for your next trustee meeting. Why do you have your plan? The answers may surprise you.
Matt Eickman

Matt Eickman

Full Bio

Matthew loves to write. He also loves to think, though he’s probably a better writer than a thinker. He does not like to be on camera or in videos. This blog will allow him to write, challenge his ability to think, and, from time to time, test him with video blog entries.

He has a unique blend of legal and practical experience that helps us to serve our clients well. On the one hand, he has more than 12 years of private legal practice experience focusing exclusively on employee benefits, including time as a partner in an employee benefits boutique where he has represented clients in front of the DOL and IRS. On the other hand, he holds his FINRA Series 7 and 66 registrations and serves as the Director of ERISA Services for Qualified Plan Advisors.

Matthew likes to stay active. He provides fiduciary training, Investment Policy Statement design, and vendor oversight to our clients. He is an active member of the Employee Benefits Committee of the American Bar Association Tax Section, serving as Chair of the Defined Contribution Plans Subcommittee. He also has been appointed to the IRS TE/GE Gulf States Council and is a frequent speaker on regulatory developments, fiduciary responsibilities, and retirement readiness.

Most importantly, he stays active with his family. His wife, Laura, is the founder of REbeL, Inc., a not-for-profit organization. His three young boys are mixed up in far too many sports, and they enjoy traveling, watching college football, running with Dad, and rooting for the Huskers.
Matt Eickman
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