Learning lessons from the US long-term savings industry
Writing in Professional Pensions, Tom Ground, the UK-based CEO of Retirement Solutions at Standard Life, describes his "learning lessons" from a recent tour of the US retirement industry. Ground characterizes the US retirement industry as being "at least ten years ahead of [the UK}" and goes on to identify the key areas where the US has excelled. High on Ground's list is auto portability, where he writes: "the US has grasped the nettle and introduced ‘auto-portability' which enables small pots to move with you to your new employer in much the same way the pot follows member concept would have worked here. Feedback from those I spoke to suggested it was an effective...solution to the problem."
$1.7 trillion sits in lost and forgotten 401(k) accounts. Is one of them yours?
Daniel de Vise, writing in USA Today, examines the phenomenon of "missing money" in the nation's retirement system. The author examines multiple approaches for finding forgotten retirement savings account, including dedicated websites, the newly-established Retirement Savings Lost & Found, and personal sleuthing. Perhaps saving the best for last, de Vise turns to auto portability, writing: "[f]ewer 401(k)s will go missing in future, experts say, thanks to the evolving concept of "auto-portability" in retirement plans" embraced by the Portability Services Network (PSN). de Vise wraps up his piece by quoting AARP's David John, who states that PSN will make sure that retirement funds “move seamlessly from one job to another."
Plan Sponsors, Providers Face Challenges Creating Retirement Income
Writing in PLANSPONSOR, Elizabeth Harris turns to retirement industry experts to examine the obstacles associated with turning retirement savings into regular income. Vanguard's Fiona Grieg, global head of the firm's investor research and policy group, addressed empirical data associated with 70,000 retirees, suggesting that many of them "just don’t know what to do." Highlighting the issue of cashout leakage, Grieg noted that "Vanguard is one of the founding recordkeepers of the Portability Services Network and is encouraging its clients to join" while pointing out that the consolidation of "small pots" could deliver significant benefits, considering that the average workers has "nine jobs over the course of their careers."
