How Plan Sponsors Can Help Employees Retire on Time: Turning Plan Design into Positive Outcomes

As a corporate plan sponsor, your role in your employees’ retirement journey is more significant than you might think. Yes, you’re responsible for managing the mechanics of the plan and meeting fiduciary obligations. But beyond that, you have the opportunity to shape outcomes that deeply affect your employees’ futures. One of the most valuable gifts you can offer is the ability for participants to retire on time, with financial security and dignity.

Yet far too many American workers aren’t on track. According to a recent survey by the Employee Benefit Research Institute (EBRI), only 1 in 5 workers feel “very confident” they will have enough money to live comfortably throughout retirement. The causes are complex—low savings rates, competing financial priorities, and a lack of clear guidance—but the good news is, thoughtful plan design can make a meaningful difference.

In this post, we’ll explore how corporate plan sponsors can use three key strategies to help improve participant outcomes:

• Automatic features (auto-enrollment and auto-escalation)

• Financial wellness programs

• Target date fund alignment

Let’s take a closer look at each—and see how they can move the needle toward better retirement readiness.

1. Auto Features: Participation and Savings on Autopilot

One of the most common roadblocks to retirement saving is inertia. People know they should save, but life gets in the way. Bills are due, kids need clothes, and the retirement plan enrollment form gets pushed to the bottom of the pile.

That’s why auto-enrollment and auto-escalation are such powerful tools. By flipping the default from “opt-in” to “opt-out,” you nudge employees to start saving without relying on them to take the first step.

Real-World Example: Boosting Participation Through Auto-Enrollment

Consider the example of a mid-sized manufacturing firm with 200 employees. Prior to implementing auto-enrollment, only about 58% of eligible employees were participating in the company’s 401(k) plan. Despite regular educational sessions and email campaigns, participation plateaued.

After consulting with their retirement plan advisor, the company introduced auto-enrollment at 3% of pay for all new hires and added auto-escalation of 1% per year, capping at 10%.

The result? Within 12 months, plan participation rose to 91%, with average deferral rates increasing from 4.2% to 6.7%. Not only were more employees saving, but they were saving more.

That’s the power of default settings. They meet employees where they are and guide them toward better decisions without requiring perfect financial discipline.

Best Practices for Auto Features

• Start with at least 6% as the default contribution rate to promote meaningful savings.

• Pair auto-enrollment with auto-escalation to grow savings over time.

• Re-enroll existing employees annually or during life events to boost ongoing participation.

2. Financial Wellness: Helping Employees Solve the Right Problems

Let’s face it, retirement isn’t the only financial concern on your employees’ minds. Many are juggling credit card debt, student loans, rising childcare costs, or simply trying to build an emergency fund.

Financial stress is one of the biggest barriers to retirement saving.

That’s where financial wellness programs come in. These programs provide holistic education and resources to help employees address their broader financial lives from budgeting and debt management to saving for retirement and understanding insurance.

When employees feel more in control of their finances, they’re more likely to participate in retirement plans and contribute consistently.

Ideas for Enhancing Financial Wellness

• Offer financial coaching (virtual or in-person) as part of your benefits package.

• Provide interactive tools and calculators within the retirement platform.

• Partner with your recordkeeper to host on-demand webinars or in-person workshops.

• Measure engagement with these resources and adjust based on feedback.

Tip: If your retirement plan provider offers a financial wellness hub, promote it through onboarding, annual enrollment, and internal communications. Awareness is half the battle.

3. Target Date Funds: One Fund, Many Benefits

Most participants aren’t investment experts and they shouldn’t have to be. That’s why target date funds (TDFs) are the default investment of choice in most corporate retirement plans.

TDFs automatically adjust the mix of stocks and bonds based on the participant’s retirement date. They’re easy to understand, low maintenance, and well-diversified.

But as a plan sponsor, your job isn’t just to offer TDFs. It’s to make sure the ones you offer are aligned with your workforce’s needs.

What to Watch For in TDF Design

• Glidepath philosophy: Is it “to” retirement (becomes conservative at retirement) or “through” retirement (remains growth-oriented after retirement)?

• Workforce demographics: Younger, lower-income employees may need a more growth-oriented TDF to build assets.

• Cost and transparency: Ensure the funds are reasonably priced and clearly disclose fees. .

Regularly review your TDF lineup with your advisor or investment committee. If your population is diverse, you may even consider offering multiple TDF suites or personalized managed accounts.

Putting it All Together: A Culture of Retirement Readiness

Improving participant outcomes doesn't happen by accident, it happens by design.

Here's how you can start moving the dial:

Action	Why It Matters
Implement or raise auto-enrollment	Captures more participants early and eliminates inertia
Add auto-escalation	Encourages long-term savings growth
Introduce financial wellness resources	Helps employees balance competing financial needs
Review and align your TDF lineup	Ensures investment options match participant profiles
Communicate consistently	Reinforces engagement and boosts trust in the plan

Even modest changes, like increasing the default contribution rate or adding a budgeting tool can produce significant long-term benefits for your employees.

And when your people are financially prepared to retire, everyone wins. Employees transition with confidence. Turnover can become more predictable. And your organization earns a reputation as a workplace that truly cares about long-term financial health.

Final Thoughts

As a corporate plan sponsor, you hold the keys to helping your employees retire on time. That’s not just a fiduciary role, it’s a leadership opportunity. By making smart design decisions today, you can unlock better futures for tomorrow.

If you’re ready to assess your plan’s impact on retirement readiness or explore how to implement these strategies, connect with your advisor or provider for a plan review. The right steps now can lead to measurable results and lasting financial clarity for your employees.

Scott Higgins | AIF ®, CFP®, CPFA®, NSSA®

Financial Advisor

Since 2012 at Rose Street, Scott has been responsible for helping the firm’s individual wealth management clients with income strategies for retirement and consulting with employers with their employee retirement plans. In free time, he enjoys golf, biking, skiing, cooking, and traveling. Fun Fact, Scott has a hobby of filling growlers with coins!

Securities and Investment Advisory Services Offered Through M Holdings Securities, Inc., a Registered Broker/Dealer and Investment Adviser, Member FINRA/SIPC. Rose Street Advisors is independently owned and operated. #4520200

Unlocking Financial Security: The Power of Qualified Longevity Annuity Contracts (QLACs)

What is a Qualified Longevity Annuity Contract (QLAC)?

A Qualified Longevity Annuity Contract(QLAC) is a type of deferred annuity funded with money from a qualified retirement plan, such as a 401(k) or an IRA. It's designed to provide a guaranteed stream of income later in life, helping to ensure that you don't outlive your retirement savings.

Top 5 Reasons to Consider a QLAC

1. Guaranteed Income

QLACs provide a steady, predictable income stream for life, offering financial clarity.

2. Tax Deferral

Funds used to purchase a QLAC are exempt from required minimum distribution (RMD) rules until payments begin.

3. Protection Against Longevity Risk

QLACs help mitigate the risk of outliving your savings.

4. Flexibility in Start Date

You can choose when to start receiving payments, typically between 65 and 85.

5. Simplicity

Once set up, QLACs require minimal management, making them easy to maintain.

Drawbacks of QLACs

1. Limited Investment Options

QLACs typically offer fixed returns, which may be lower compared to other investment options.

2. Irrevocability

Once purchased, QLACs cannot be easily modified or canceled.

3. Upfront Costs

There may be fees and charges associated with purchasing a QLAC.

4. Lack of Liquidity

Funds used for a QLAC are not easily accessible until the annuity start date.

5. Inflation Risk

If QLACs do not include inflation adjustments, purchasing power may decrease over time.

Have questions or if this may be right for you, give us a call.

Scott Higgins | AIF ®, CFP®, CPFA®, NSSA®

Financial Advisor

It is officially Summer! Favorite summer past times of grilling burgers, hotdogs, swimming, boating, gardening, camping and just spending time outside is here. A staple in many American refrigerators in the summertime, and throughout the year, is Ketchup. Ketchup has a way of giving those grilling favorites that much needed edge to just simply make it better. Just like ketchup gives our grilling favorites the edge needed, catch-up contributions in a 401k can serve the same purpose.

If you or someone you love is still working and is or going to turn 50 this year, while the normal contribution limit to a 401k/403b plan is $23,000 for 2024, those 50 and older can make catch-up contributions of an additional $7,500, totaling $30,500. The extra amount contributed can really give an investor’s portfolio the extra boost needed to stay on track or get back on track for retirement goals.

On December 29, 2022, Congress passed the SECURE 2.0 Act, which stands for Setting Every Community Up for Retirement Enhancement. Several of the provisions outlined in the act have delayed start dates. Beginning in 2025, Section 109 of the SECURE 2.0 Act allows employees who are 60-63 years old to contribute at a “super” catch-up rate! The super catch-up allows for investors to make an additional 50% increase to the $7,500, which would result in $11,250 in additional catch-up contributions in 2025. This catch-up contribution is planned to index to inflation and could mean possibly more contributions in future years.

If you have questions or want to learn more, please reach out and let's chat.

Securities and Investment Advisory Services offered through M Holdings Securities, Inc., a Registered Broker/Dealer and Investment Advisor, Member FINRA/SIPC. Rose Street Advisors, LLC is independently owned and operated. File # 6718069.1

Jeremy Heavey

AIF ® | FINANCIAL ADVISOR

Jeremy has a professional track record starting, leading, and managing for-profit and non-profit organizations. He is a graduate of Taylor University and has completed business programs at both Hong Kong Baptist University & Harvard Business School. Jeremy is also formally trained and certified in behavioral assessment, conflict management and life coaching. Jeremy, his wife Kim and their 4 kids reside in Kalamazoo. They love spending time exploring the outdoors, fixing up their farmhouse, and living life with friends and extended family.

Fun fact: Jeremy has been playing drums since he was 13 years old and made callbacks for the Blue Man Group.

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Are you looking for a Financial Advisor in Kalamazoo? Finding the right financial advisor to partner with you and your family is crucial in helping you work towards your goals. Whether you're planning for retirement, managing investments, seeking advice on holistic financial planning or all of the above, a skilled financial advisor is a critical part of your team. As you are seeking to find the best financial advisor for YOU, consider these 5 tips:

1. Define Your Financial Goals

Before you start your search for a financial advisor, it's crucial to have a clear understanding of your financial goals and objectives. Are you looking for retirement planning, investment management, debt reduction strategies, or comprehensive financial planning or maybe some or all of the above? Knowing your specific needs will help you narrow down your search and find an advisor with expertise in the areas that matter most to you.

2. Learn How they Are Licensed

When considering potential financial advisors, it's essential to learn how they are licensed. There are 2 distinct ways to be licensed, as a fee-based fiduciary advisor or a commissioned-based broker. Depending on your needs and desires, one might be a better fit than the other. Look for advisors who hold reputable certifications such as Certified Financial Planners (CFP), Certified Financial Analysts (CFA) or Accredited Investment Fiduciaries (AIF). These designations require education, experience, and ethical standards, ensuring that your advisor has the necessary expertise to provide sound financial advice.

3. Seek Recommendations and Referrals

One of the most reliable ways to find a trustworthy financial advisor is through recommendations from friends, family, or colleagues who have had positive experiences. Ask people in your network if they can recommend an advisor they trust and/or ask your advisor if they can share some references you can contact. Additionally, you can consult with professionals in related fields, such as attorneys or accountants, who often work with financial advisors and may provide referrals.

4. Interview Potential Advisors

Once you've compiled a list of potential advisors, schedule initial interviews or consultations. Advisors who are serious about working with you will usually provide a complimentary consultation. This is an opportunity to get to know the advisors and assess their compatibility with your financial goals and personal values. During these meetings, ask questions about their investment philosophy, fee structure, and client services. Pay attention to their communication style and willingness to listen to your concerns and objectives.

5. Understand Fee Structures

Financial advisors charge in various ways, including commissions, flat fees, hourly rates, or a percentage of assets under management. It's essential to understand how your potential advisor charges for their services and how this fee structure aligns with your financial situation, goals and preferences. Be transparent about your expectations to ensure there are no surprises down the road.

Choosing the right financial advisor in Kalamazoo is a significant decision that can have a lasting impact on your financial well-being. By defining your goals, checking qualifications, seeking recommendations, interviewing potential advisors, and understanding fee structures, you can make an informed choice that aligns with your financial objectives. Remember that trust, compatibility, and open communication are key factors in building a successful advisor-client relationship.

At Rose Street Advisors, we often tell our clients and potential clients that the more we know about them, the better we can put together a tax-efficient holistic financial life plan, build and manage a diversified portfolio and serve as their personal CFO, helping guide them towards their goals. Want to know more? We are always happy to have a chat.

Securities and Investment Advisory Services offered through M Holdings Securities, Inc., a Registered Broker/Dealer and Investment Advisor, Member FINRA/SIPC. Rose Street Advisors, LLC is independently owned and operated. File # 6439955.1

Jeremy Heavey

AIF ® | FINANCIAL ADVISOR

Jeremy is passionate about partnering with individuals and families to identify what is important in their lives and creating a comprehensive financial strategy to help them reach their life goals. This holistic approach allows Jeremy and the wealth management team to ensure the specific needs of the client are front and center as they make investment recommendations and collaboratively design custom-tailored financial plans. Jeremy has a professional track record starting, leading, and managing for-profit and non-profit organizations. He is a graduate of Taylor University and has completed business programs at both Hong Kong Baptist University & Harvard Business School. Jeremy is also formally trained and certified in behavioral assessment, conflict management and life coaching. Jeremy, his wife Kim and their 4 kids reside in Kalamazoo. They love spending time exploring the outdoors, fixing up their farmhouse, and living life with friends and extended family. Fun fact: Jeremy has been playing drums since he was 13 years old and made callbacks for the Blue Man Group.

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All Things 401k | 5 Helpful Ways to Organize Your 401(k) Fiduciary Files

Managing Discover top strategies for maintaining organized 401(k) fiduciary files with best practices for compliance and peace of mind. As a plan sponsor, one of your primary responsibilities is ensuring that your company's retirement plan operates smoothly and within the boundaries of compliance regulations. This is no small feat, especially when dealing with the complexities of a 401(k) plan. One of the ways to help enable hassle-free management is by maintaining neat and tidy records. This article will provide you with some practical tips and best practices on how to organize and document your fiduciary files.

Why Is Retirement Plan Documentation Important?

First, let's delve into why retirement plan documentation is crucial. Proper documentation serves as evidence of your diligent fiduciary oversight. It helps to show that you are actively managing your company's retirement plan in accordance with ERISA regulations. Moreover, it helps streamline the auditing process and makes it easier to answer inquiries from your plan's third-party administrator (TPA).

Best Practices for Organizing Fiduciary Files

Now, let's explore some of the best methods to keep your fiduciary files in order: 1. Create a Fiduciary File System: Designate a secure location, preferably a locked file cabinet or encrypted digital storage space, for all plan-related documents. This includes the plan document, amendments, participant communications, government filings, and investment reviews. Action item: Create a new master folder and label it “401(k) Plan”. Within this master folder, create subfolders with important categories such as, “Plan Document and Amendments”, “Participant Communications”, “Annual Filings”, and “Investment Reviews”. Ensure that relevant documents are correctly placed within their corresponding subfolders. 2.Implement a Document Retention Policy: Develop a policy that outlines for how long different types of documents should be retained. For instance, the plan document and amendments should be kept permanently, while records related to plan operations should typically be kept for at least six years. 3.Regularly Update Your Files: Make it a habit to update your files regularly. This includes adding new documents as they come in and removing outdated ones based on your retention policy. 4.Use Clear Labeling and Categorization: Clearly label each document with its type and the date it was created or received. Categorize documents based on their nature, such as plan administration, investment management, participant records, and compliance tests. Folder / File Name Examples •Plan Document and Amendments / Plan Document-ABC Company-401k Plan-2010.docx •Investment Reviews / Investment Review-ABC Company-401k Plan-Q1 2024.docx •Participant Communications / Participant Education-ABC Company-401k Plan-Q1 2024.docx 5.Ensure Accessibility While Maintaining Confidentiality: Balancing accessibility with confidentiality is vital when managing fiduciary files. The documents should be readily retrievable as needed, yet stored in a manner that protects sensitive data from unauthorized access. Implement safeguards such as password protection for sensitive documents and restrict access to authorized personnel only. Let’s take the company's census file as an example. This file holds sensitive information like Social Security numbers, dates of birth, salaries, 401(k) deferral amounts, employer match, and profit sharing calculations. This file should be safeguarded with a password and is only accessible to employees who require this information for their roles. For instance, a newly hired temporary employee would not have access to this file, ensuring the information remains confidential.

Reduce the Hassle of Compliance Testing

One of the many benefits of maintaining organized fiduciary files is how much easier it makes compliance testing. For example, your plan's TPA usually asks for uploading census data by January 31st to run their compliance tests for the year. By having clean data and organized files, this task becomes significantly less daunting. Instead of spending hours searching for and compiling the requested information, you can access it within a few clicks. This not only saves you valuable time, but it also helps ensure that your TPA has all the necessary information to perform accurate compliance tests.

Structure for Success

Maintaining a well-organized 401(k) is more than just a tidy system of records. It's an outward sign of effective fiduciary oversight, accurate audits, and comprehensive compliance testing. As a plan sponsor, you play an important role in the smooth operation of your company's retirement plan. However, you don't have to navigate this path alone. Partnering with an experienced 401(k) advisor can offer valuable assistance, provide answers to your questions, and help ensure you're on the right track. Remember, the success of your 401(k) plan is not just about its performance but also about its organization and compliance. We are here to provide guidance, help you stay organized, and support the development of a bright financial future for your employees.

JULIA SANDERS

AIF®, CPFA® | Retirement Relationship Manager

Meet Julia, a people-focused life-long learner with several years of experience in the retirement plan industry. Throughout her career, Julia has been committed to maintaining strong client relationships by providing incredible customer service. She is passionate about helping clients define and plan for their retirement goals. Julia’s daily role at the firm energizes and reinforces her commitment to client-focused work.

SCOTT HIGGINS

AIF®, CFP®, CPFA® | Financial Advisor

Since 2012 at Rose Street, Scott has been responsible for helping the firm's individual wealth management clients with income strategies for retirement and consulting with employers with their employee retirement plans. In free time, he enjoys golf, biking, skiing, cooking, and traveling. Fun fact, Scott has a hobby of filling growlers with coins!

Securities and Investment Advisory Services offered through M Holdings Securities, Inc., a Registered Broker/Dealer and Investment Advisor, Member FINRA/SIPC. Rose Street Advisors, LLC is independently owned and operated. #6188012.1

This information was developed as a general guide to educate plan sponsors and is not intended as authoritative guidance or tax/legal advice. Each plan has unique requirements, and you should consult your attorney or tax advisor for guidance on your specific situation.

©401(k) Marketing, LLC. All rights reserved. Proprietary and confidential. Do not copy or distribute outside original intent.

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All Things 401k | Wrapping up 2023: A Comprehensive Guide to End-of-Year 401(k) Tasks

As the end of 2023 draws near, those responsible for their company 401(k) plan have much to consider. With a combination of standard annual tasks and new SECURE Act provisions on your plate, we are here to help you. This article is a helpful guide for wrapping up 2023 smoothly! We will dive into those end-of-year 401(k) tasks that require your attention including plan design review, SECURE Act preparation, Required Minimum Distributions (RMDs), employee deferrals and more. Annual Review An annual review is a great time to kick the tires and make sure your plan is still working well. Assessing key demographics such as participation, deferral rates, assets allocation and loan activity can help shine light on opportunities for the plan. Updates could be necessary to keep your plan in compliance, boost performance and/or better suit your organizational needs. Safe Harbor Considerations If you are considering adding or changing your company match formula, now is a good time to discuss it before December 1st. Both new and existing plans need to finalize any decisions on safe harbor match changes before the deadline. This will allow sufficient time to distribute the required notices. Long-Term, Part-Time Employees Starting January 1st, 2024, new rules go into effect for long-term, part-time employees. The SECURE Act requires 401(k) plans to allow employees who have worked 500 hours or more in the past three consecutive 12-month periods to contribute to the plan. It's important that you track and record the correct hours. Required Minimum Distributions The annual deadline for paying out RMDs is December 31st, so now is the time to get ahead. Take this time to review the list of affected participants. This includes current and terminated participants over the age of 72 (73 if the person reached age 72 after December 31st, 2022). Bonuses If paying year-end bonuses, you might consider checking the definition of compensation in your document. If bonuses aren't included in this definition, there won't be any deductions for 401(k) or 403(b) contributions from the bonus. However, if the plan counts all types of pay as compensation, contributions should be taken from the bonuses. Opt-Out Records While the decision to participate in the retirement plan rests solely with each employee, it is your responsibility to keep accurate documentation. It's essential to keep clear records, indicating that employees were given the choice to defer their participation. Furthermore, any instances where an employee has chosen to defer 0% of their earnings must be meticulously recorded. Expense Account If you have an ERISA spending account, also known as an ERISA bucket or plan expense reimbursement account, review it before the year ends. This account is typically used to cover plan-related costs. However, if there is leftover money in the account, it is often distributed back to the participants. Your plan document should provide details on how this surplus revenue is distributed. Some plans distribute the excess to all participants, while others only disburse it to those who invest in funds with revenue-sharing agreements. Required Notices Remember, December 1st is the deadline for annual participant notices. These notices inform employees about their 401(k) plan's operations, investment options and fees. Ensuring timely distribution helps avoid penalties and maintains your plan's tax benefits. Lean on Your Advisor The end of the year is an exciting time, but it can also be stressful. That is why we work closely with our clients to tackle these end-of-year tasks. Whether it's questions about required notices, compliance deadlines, plan design review or anything else, we're here to help.

JULIA SANDERS

AIF®, CPFA® | Retirement Relationship Manager

SCOTT HIGGINS

AIF®, CFP®, CPFA® | Financial Advisor

Securities and Investment Advisory Services offered through M Holdings Securities, Inc., a Registered Broker/Dealer and Investment Advisor, Member FINRA/SIPC. Rose Street Advisors, LLC is independently owned and operated. #6006784.1

This information was developed as a general guide to educate plan sponsors and is not intended as authoritative guidance or tax/legal advice. Each plan has unique requirements, and you should consult your attorney or tax advisor for guidance on your specific situation.

©401(k) Marketing, LLC. All rights reserved. Proprietary and confidential. Do not copy or distribute outside original intent.

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All Things 401k | 6 Common Administrative Tasks That Can Morph Into 401(k) Plan Headaches

Managing a 401(k) plan can leave even the most seasoned administrators feeling overwhelmed. With proper support, you can simplify the complex task of retirement plan management. Top 401(k) Plan Headaches The first step is to understand the potential problems. Here are some common issues that can cause headaches for plan sponsors: • Uploading Payroll • Determining Eligibility • Over-Contributions • Investment Changes • Distributing Notices • Regulatory and Legislative Updates Navigating the labyrinth of retirement plan management can seem like a daunting challenge for any plan sponsor, employer or 401(k) plan administrator. The various administrative tasks, ranging from uploading payroll to handling investment changes, can often turn into 401(k) plan headaches. 1. Uploading Payroll A seemingly straightforward process can quickly turn into a minefield of errors. Incorrect data entry could lead to improper contributions, which could potentially result in legal and financial complications. One area of particular focus is the plan’s definition of compensation. When a special payroll cycle includes different types of compensation such as bonuses, commissions, or overtime, it’s important to know whether that compensation should be included or excluded from the 401(k) plan. This specific issue ranks #2 on the IRS’ Top Ten Failures Found in Voluntary Correction Program. 2. Determining Eligibility When an employee may enter your 401(k) plan is different for each employer. Common eligibility requirements include 21 years old and 1,000 hours of service. Then the employee is eligible to enter the plan on the next entry date: for example, January 1st and July 1st. However, effective January 1st, 2024, there are new eligibility rules for long-term, part-time employees. Under the SECURE Act, employees that have worked 500 hours for three consecutive years are eligible to participate in the 401(k) plan on January 1st, 2024. 3. Over-Contribution Quandary An employee might max out their savings, then end up getting money back due to annual contribution limits. This creates extra administrative work and potential confusion for both parties. Get ahead of this now by running a report to learn if any employees are close to – or have - maxed out their 401(k) plan. 4. Investment Changes Moving from one investment option to another can be a complex process, requiring professional guidance from a 3(21) or 3(38) investment fiduciary. Plan sponsors should work with a 401(k) advisor, like us, to evaluate watch list funds and then implement recommendations based on your plan’s Investment Policy Statement. Additionally, it’s critical to communicate these changes to plan participants. 5. Distributing Notices Ensuring that all employees receive timely and accurate information about their 401(k) plan can be a daunting task, especially for large companies. One idea is to work with your recordkeeper and instruct them to send out notices. Another idea is to hire a 3(16) plan administrator who will send out and track required plan notices. 6. Regulatory and Legislative Updates Staying informed and compliant with the ever-changing landscape of retirement plan regulations is a significant challenge. For example, the SECURE Acts are two long and lengthy pieces of legislation that greatly impact 401(k) plans. 401(k) Plan Headache Relief This is where a 401(k) advisor can give a helping hand. We can offer valuable support and guidance across several key areas: • third party administrator (TPA) communication • recordkeeper collaboration • investment strategy • plan design support • employee education • fiduciary and regulatory guidance While the role of managing a 401(k) plan can be fraught with potential pitfalls and headaches, the support of a specialized retirement plan advisor can significantly lighten the load. We can help streamline processes, establish compliance best practices, educate employees and foster an efficient retirement plan.

JULIA SANDERS

AIF®, CPFA® | Retirement Relationship Manager

SCOTT HIGGINS

AIF®, CFP®, CPFA® | Financial Advisor

Securities and Investment Advisory Services offered through M Holdings Securities, Inc., a Registered Broker/Dealer and Investment Advisor, Member FINRA/SIPC. Rose Street Advisors, LLC is independently owned and operated. #6006781.1

This information was developed as a general guide to educate plan sponsors and is not intended as authoritative guidance or tax/legal advice. Each plan has unique requirements, and you should consult your attorney or tax advisor for guidance on your specific situation.

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Less Tax for You. More Money to the Charity. Nothing for the Government. What’s not to love?

When you reach 73 years old, you are required to start taking minimum distributions from your traditional IRAs and certain other retirement accounts. These distributions are generally subject to income tax. If you are charitably inclined, you may be able to satisfy all or a portion of your required minimum distribution, lower your taxable income and give more to the charity by utilizing a special provision called a Qualified Charitable Distribution (QCD). A QCD allows you to donate funds directly from your traditional Individual Retirement Accounts (IRAs) to eligible charitable organizations. The donated amount counts towards your Required Minimum Distribution (RMD) for the year AND is excluded from your taxable income. This can result in a lower overall tax liability for you and potentially more money going directly to the charity.

As you seek ways to help to optimize your financial situation while making meaningful contributions to society, QCDs provide a versatile tool to achieve both objectives. Before making any decisions, it's important to consult with a professional advisor who can help tailor this strategy to your specific circumstances and charitable goals. With proper planning, QCDs can serve as a win-win solution for retirees and the charitable organizations you support.

Securities and Investment Advisory Services offered through M Holdings Securities, Inc., a Registered Broker/Dealer and Investment Advisor, Member FINRA/SIPC. Rose Street Advisors, LLC is independently owned and operated. File # 5922845.1

Jeremy Heavey

AIF ® | FINANCIAL ADVISOR

Fun fact: Jeremy has been playing drums since he was 13 years old and made callbacks for the Blue Man Group.

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All Things 401k | Talent Management and Total Rewards Edition

The future of talent management and total rewards is changing. With the SECURE Act 2.0 now in effect, the field of plan design must keep pace with the ever-evolving employment landscape. There are a number of ways that can help you stay ahead of the competition, toward securing better outcomes for your workforce. Our plan sponsor newsletter focuses on:

· Total Rewards: Helping define and implement effective compensation strategies tailored to individual needs.

· Plan Design: Developing 401(k) plans that meet key requirements while allowing employees to save effectively.

· SECURE Act 2.0: Making sure your plans are up to date with the latest regulations for the upcoming 2024 year.

CTA: Download the Newsletter

JULIA SANDERS

AIF®, CPFA® | Retirement Relationship Manager

SCOTT HIGGINS

AIF®, CFP®, CPFA® | Financial Advisor

Securities and Investment Advisory Services offered through M Holdings Securities, Inc., a Registered Broker/Dealer and Investment Advisor, Member FINRA/SIPC. Rose Street Advisors, LLC is independently owned and operated. #5787277.1

This information was developed as a general guide to educate plan sponsors and is not intended as authoritative guidance or tax/legal advice. Each plan has unique requirements, and you should consult your attorney or tax advisor for guidance on your specific situation.

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Guide to Retirement | Long-Term, Part-Time Overview for 2024

For part-time workers, saving for retirement can be a challenge. Many part-time employees are often excluded from 401(k) plans because they often don’t meet the plan’s eligibility requirements. This includes many students, parents and individuals with multiple part-time jobs. However, new legislation that goes into effect on January 1, 2024, is about to change that.

Effective on January 1, 401(k) plans must allow employees who have worked more than 500 hours of service in three consecutive 12-month periods to contribute elective deferrals to the plan. Let’s look at an example.

Example 1

Alex was hired in 2016 as a part-time employee. She has never been able to participate in the company’s 401(k) plan because she didn’t meet the 1000 hours requirement. In 2021, 2022 and 2023, she worked 600 hours per year. She has worked more than 500 hours and completed three consecutive 12–month periods, so she can enter the plan on January 1, 2024.

Example 2

Riley was hired on May 15, 2021 as a part-time employee. He worked 400 hours in 2021, 600 hours in 2022 and 600 hours in 2023. On May 15, 2024, he completed three consecutive 12-month periods; however, he did not work enough hours to be eligible.

Importantly, employers must properly track employee hire dates and hours worked to determine eligibility. Tracking hours is crucial to determining employee eligibility for the plan, including tracking periods starting from January 1, 2021 (since that date going forward determines eligibility). Additionally, employers should be aware of the administrative burden involved in operating their plans and how these changes will affect plan operations under the Long-Term, Part-Time provisions.

According to these rules, employers are not required to make employers contributions to the accounts of LTPT employees, which includes contributions under safe harbor 401(k) plan provisions and top heavy minimums but if employers want, they can. Additionally, employers can choose to exclude employees from nondiscrimination testing related to elective deferrals, employer match and nonelective contributions. See your TPA for more specifics.

2025 and Beyond

For 2025 and with the modifications in SECURE 2.0, the rules change again. An employee only needs two consecutive 12-month periods with more than 500 hours of service to be eligible to participate in the company’s 401(k) plan.

Example 3

Riley was hired on May 15, 2021 as a part-time employee. He worked 400 hours in 2021, 400 hours in 2022, 600 hours in 2023 and 600 hours in 2024. He has completed two consecutive 12-month periods with more than 500 hours; he is eligible to participate in the company’s 401(k) plan on the next entry date.

Understanding Plan Eligibility

In summary, the LTPT provisions are a significant change to retirement plan eligibility requirements. While the SECURE 1.0 and 2.0 Acts offer solutions, employers must take action to properly track employee hours and ensure those employees become aware of their eligibility to join the 401(k) plan.

Employers should also evaluate their plan design and consider whether allowing all employees to contribute immediately upon hire would be worthwhile. By working closely with your third party administrator and plan advisor, employers can ensure that they are meeting the requirements of the SECURE 1.0 and 2.0 Acts and offering employees the best possible retirement savings opportunities.

JULIA SANDERS

AIF®, CPFA® | Retirement Relationship Manager

SCOTT HIGGINS

AIF®, CFP®, CPFA® | Financial Advisor

Securities and Investment Advisory Services offered through M Holdings Securities, Inc., a Registered Broker/Dealer and Investment Advisor, Member FINRA/SIPC. Rose Street Advisors, LLC is independently owned and operated. #5787251.1

This information was developed as a general guide to educate plan sponsors and is not intended as authoritative guidance or tax/legal advice. Each plan has unique requirements, and you should consult your attorney or tax advisor for guidance on your specific situation.

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