Guide to Retirement | Stock Markets Impact on Retirement Savings

The stock market’s movements can cause a bit of anxiety and stress for investors. One of the keys to a successful retirement is to keep saving, no matter what the stock market is doing. It’s always beneficial to connect with an advisor to help understand your investments whether the stock market is up or down. Watch the Video

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. #5787304.1

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 | Unlock Employee Potential with Effective and Appealing Total Rewards Program

You may have heard of a Total Rewards Strategy. It is a recruiting and retention strategy given that it goes beyond the traditional salary benefits by providing holistic rewards that entail added motivation for employees. This strategy allows companies to improve employee satisfaction without compromising business goals – it's an all-around win! CTA: Download the Guide

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. #5787273.1

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.

Interested in more?

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All Things 401k | SECURE Act 2.0: What 401(k) Managers Need to Know for 2024

Required for 2024

Luckily, the required changes for 2024 are minimal.

Requirement Summary

Long-term, part-time employees become eligible to participate in the 401(k) plan. Catch-up contributions are required to be Roth if the participant earns more than $145,000 in W-2 compensation.

Long-term, Part-time Employees

As part of SECURE 1.0, there is an important provision about long-term, part-time employees and retirement plan eligibility. In short, effective January 1, 2024, 401(k) plans must allow employees who have worked 500 hours or more in the past three consecutive 12-month periods to contribute elective deferrals to the plan.

Changes for High Earning Pre-Retirees

Employees looking to maximize their retirement savings with catch-up contributions should be aware that if they earn more than $145,000 in W-2 wages, their contributions are now required to be Roth. If the employee earns less than $145,000, they can choose either pre-tax or Roth contribution type. Note that plans need to allow for Roth contributions for this option to be available. UPDATE as of August 25, 2023: The IRS announced a two-year transition period that extends until 2026 this provision requiring higher-income participants to make catch-up contributions as Roth. In addition, the IRS clarified that plan participants who are age 50 and over can continue to make catch-up contributions after 2023, regardless of income. These required provisions may need additional explanation. Contact us to discuss your specific plan.

Optional for 2024

While this is not a complete list of the optional provisions to consider in 2024, this short list includes several of the most anticipated. We want to focus on the provisions that may reduce your administrative hassle, provide employees relief during compromising situations and could encourage positive savings behaviors.

Reduce Administrative Hassle

Account Transfers for Former Employees

Retaining 401(k) accounts of former employees can be onerous for plan sponsors, particularly if the accounts are small and inactive. However, there is a new solution available that helps facilitate the transfer of accounts to the ex-employees' new employers. Automatic portability is a transaction process that allows 401(k) accounts with balances between $1,000 and $7,000 to be transferred to the new employer's retirement plan automatically, without involving the former employee. This can save plan sponsors time and resources, while also ensuring that former employees' retirement savings remain safe and intact. Fortunately, many recordkeepers and service providers can help facilitate smooth 401(k) account transfers. From locating missing plan participants to handling necessary paperwork, the right partner may help reduce costs, improve efficiency and enhance employee satisfaction.

Safe Harbor IRA Upgraded

Previously, plan sponsors could only transfer former employees' 401(k) accounts to a Safe Harbor IRA if the balance was not more than $5,000. The revised provision increased that amount to $7,000. This may help improve plan administration by helping sponsors avoid large plan audits, additional fees and issues caused by missing participants.

Provide Employees Support

Help Workers Access $1,000 for Emergencies

SECURE Act 2.0 offers a simple solution for employees who need to access retirement savings for personal or family emergencies. This provision allows workers to withdraw up to $1,000 from their retirement savings without incurring the typical 10% excise tax penalty. Even better, the withdrawal is not a loan and requires little additional paperwork or administrative burden. Employees can take advantage of this one-time distribution and optionally repay it within three years. This feature could prove particularly useful for busy HR professionals and 401(k) administrators, looking to streamline processes and save time.

Payroll Deducted Emergency Savings

This "side-car" emergency account can provide employees with further security and peace of mind in the face of financial uncertainty. Under this provision, employers can automatically enroll their employees in a savings account that allows up to 3% of their wages to be saved for emergencies. Account contributions are made on a Roth-like basis and are capped at $2,500. Once the cap is reached, additional contributions can be directed into a Roth-defined contribution plan or stopped altogether. The accounts are also subject to annual matching contributions. Additionally, the first four withdrawals from the account each year are not subject to any fees or charges. These emergency savings accounts are for non-highly compensated employees. This new feature helps employers support their workers' financial well-being and to become more confident and secure in their financial lives.

Penalty-Free Withdrawals Available for Victims of Domestic Abuse

Domestic abuse survivors can withdraw up to $10,000 (or 50% of their retirement fund, whichever is lesser) without penalty. This initiative provides much needed financial security for survivors.

Natural Disasters and Financial Response

In the unfortunate event of a natural disaster, this new measure provides relief for those dealing with it. Individuals can withdraw up to $22,000 from their retirement plan or IRAs without facing the 10% early withdrawal tax penalty. This amount can be paid back over three years or the recipient can pay taxes on the distribution, if not repaid, spread out over three tax years.

Encourage Positive Savings Behaviors

Auto-Features and Honest Mistakes Are Now Protected

Auto-features have been proven over and over to help all workers save for retirement. In that spirit, this provision provides a grace period for correcting certain retirement plan errors. Plan sponsors now have 9 ½ months after the close of each plan year to rectify mistakes related to default enrollment or matching contributions without facing any penalty. This is beneficial for HR executives, who often have to deal with a large number of employees and may occasionally make innocent mistakes. The extension offers them peace of mind from potential fines and allows them to focus on more important tasks rather than worrying about errors made when administrating their retirement plans.

Next Steps

As a 401(k) manager or employer, you have the opportunity to take advantage of the SECURE Act 2.0 provisions to reduce administrative hassle, encourage positive savings behaviors and enhance financial confidence for your employees. Reach out to us today to learn more about how the new legislation can benefit your plan. Don't miss out on this chance to make a real impact on your employees' future!

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.

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

Interested in more?

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Guide to Retirement | Demystifying Social Security Benefits and Taxation in Retirement Planning

Social Security benefits serve as a vital source of income for millions of retired and disabled individuals in the United States. While these benefits are designed to provide financial security, it’s important to understand how they are taxed. Let’s break down the basics of Social Security benefit taxation, including when and how it occurs, ensuring you have a clearer picture of how this impacts your overall retirement income. When Social Security Benefits are Taxed: Not all recipients of Social Security benefits are required to pay taxes on their benefits. The taxability of these benefits is determined by a combination of your income and fling status. The Internal Revenue Service (IRS) uses a formula known as “provisional income” to calculate whether your benefits are subject to taxation. Provisional income is calculated by adding up your adjusted gross income (AGI), non-taxable interest, and half of your Social Security benefits. Based on this provisional income, the IRS established certain income thresholds to determine whether your benefits are taxable. These thresholds are as follows for the tax year 2023:

1) Single filers:

· If your provisional income is below $25,000, your benefits are generally not taxable.

· If your provisional income falls between $25,000 and $34,000, up to 50% of your benefits may be subject to taxation.

· If your provisional income exceeds $34,000, up to 85% of your benefits may be taxable.

2) Married couples filing jointly:

· If your provisional income is below $32,000, your benefits are generally not taxable.

· If your provisional income falls between $32,000 and $44,000, up to 50% of your benefits may be subject to taxation.

· If your provisional income exceeds $44,000, up to 85% of your benefits may be taxable.

It’s important to note that these income thresholds may change over time due to inflation or adjustments in tax regulations, so it’s always wise to consult the latest information provided by the IRS. In addition, social security benefits may be subject to a reduction of benefits if receiving benefits while still working prior to you full retirement age. This topic will be covered in a later article. How Social Security Benefits Are Taxes: If a portion of our Social Security benefits is subject to taxation, the IRS uses a multi-tiered system to determine the specific tax liability. The taxable portion can be added to your other sources of income to determine your overall tax bracket. However, it’s crucial to understand that the maximum taxable amount of Social Security benefits is limited to 85% of the total benefit amount. In other words, even if you fall into the higher tax bracket, you will not pay taxes on more than 85% of your Social Security benefits. Reporting and Paying Taxes: To account for the taxation of Social Security benefits, you are required to report the taxable portion of your benefits on your federal income tax return. This is done using IRS Form 1040 or 1040A. If you receive a Form SSA-1099 (Social Security Benefit Statement) from the Social Security Administration, it will provide you with the necessary information to determine the taxable portion of your benefits. If you anticipate owing taxes on your Social Security benefits, you have the option to make quarterly estimated tax payments or have taxes withheld from other sources of income, such as pensions or retirement account distributions. To have taxes withheld from your Social Security benefits themselves, you can complete IRS Form W-4V. Understanding the taxation of Social Security benefits is essential for retirees and those nearing retirement age. By grasping the basic principles outlined in this article, you can better navigate the complex tax rules surrounding these benefits. Remember, not all Social Security income is taxed, and the taxability depends on your provisional income. Consult with a tax professional to determine the specific tax implications based on your personal circumstances. Stay informed, plan ahead, and make the most of your Social Security benefits. The tax and legal references attached herein are designed to provide accurate information with regard to the subject matter covered and are provided with the understanding that Rose Street Advisors is not engaged in rendering tax, legal, or actuarial services. If tax, legal or actuarial advice is required, you should consult your accountant, attorney, or actuary. Rose Street Advisors does not replace those advisors.

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. #5829024.1

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.

Interested in more?

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All Things 401k | Supercharge Your Company's Retirement Benefits: The Ultimate Guide to Cross-Tested Profit Sharing Plans for Plan Sponsors

A Cross-Tested Profit-Sharing Plan is a type of 401(k) profit-sharing plan that allows employers to allocate contributions unequally among employees based on certain predetermined factors. These plans are particularly attractive for businesses with a diverse workforce, varying compensation levels, and different age groups. By using this design, employers can strategically allocate contributions to favor specific groups of employees, such as highly compensated employees (HCE) or older employees, while still satisfying the nondiscrimination testing requirements set by the Internal Revenue Service (IRS). Here's how a 401(k) Cross-Tested Profit-Sharing Plan works:

1. Establishing Plan Criteria: The employer identifies specific factors to classify employees into different groups. Common criteria included job classification, compensation levels, age, and years of service. Employees are grouped based on these criteria.

2. Setting up Contribution Groups: Once the employee groups are established, the plan sponsor creates contribution groups that consist of employees with similar characteristics. These groups may include HCEs, non-highly compensated employees (NHCEs), different departments, or any other relevant segments of the workforce.

3. Allocating Contributions: The employer determines the total employer contribution to be made to the plan for a particular year. The allocation of contributions is based on a percentage of each employee’s compensation, typically expressed as a fraction of the employee’s salary.

4. Passing Nondiscrimination Testing: One of the critical aspects of a Cross-Tested Profit-Sharing Plan is passing the nondiscrimination testing requirements imposed by the IRS. These tests ensure that the plan does not unfairly favor HCEs and discriminate against NHCEs.

a. Coverage Testing: The plan must cover a sufficiently broad group of employees, including both HCEs and NHCEs, to ensure it does not disproportionately benefit higher-paid employees.

b. Actual Deferral Percentage (ADP) Testing: The ADP test compares the average deferral percentages of HCEs to those of NHCEs. If the difference between these two groups is substantial, corrective actions may be necessary.

c. Actual Contribution Percentage (ACP) Testing: The ACP test examines the employer matching and profit-sharing contributions made to HCEs versus NHCEs. Like the ADP test, any significant disparities may require corrections.

5. Corrective Actions: If the plan fails any of the nondiscrimination tests, the plan sponsor has options to correct the imbalance. Corrective actions may include returning excess contributions to HCEs, implementing a Qualified Non-Elective Contribution (QNEC) for NHCEs, or adopting a Safe Harbor 401(k) plan design to bypass the testing altogether.

6. Annual Review and Adjustment: Cross-Tested Profit-Sharing Plans should be reviewed annually, considering the company’s financial situation, workforce composition, and retirement objectives. Adjustments may be made to the contribution allocation to remain compliant and align with the company’s goals.

It's important to note that implementing a Cross-Tested Profit-Sharing Plan requires careful planning and consultation with retirement plan experts, as the design can be complex and must comply with IRS regulations. Plan sponsors should work closely with a qualified retirement plan advisor to ensure proper plan design, administration, and compliance with all regulatory requirements.

JULIA SANDERS

AIF®, CPFA® | Retirement Relationship Manager

SCOTT HIGGINS

AIF®, CFP®, CPFA® | Financial Advisor

The tax and legal references attached herein are designed to provide accurate information with regard to the subject matter covered and are provided with the understanding that Rose Street Advisors is not engaged in rendering tax, legal, or actuarial services. If tax, legal or actuarial advice is required, you should consult your accountant, attorney, or actuary. Rose Street Advisors does not replace those advisors. #5829025.1

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. #5829025.1

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.

Interested in more?

Let's Talk

All Things 401k | Should You Add an Automatic Safe Harbor IRA to Your Plan?

High employee turnover could lead to a rise in small 401(k) accounts. Explore how adding a Safe Harbor IRA provision to your plan may help reduce plan costs and potential fiduciary risks. In 2022, more than 50 million Americans left their jobs and in the last two years, there has been record-breaking employee turnover.[1] While the number of employee departures has begun to decrease, it still remains higher than pre-pandemic levels. Employee turnover can cause problems for employers, such as many small 401(k) accounts being left behind in the company's plan. Such accounts can amplify plan costs and fiduciary risks, making it essential for plan sponsors to address these orphaned accounts. So much so that the Department of Labor (DOL) has made missing participant search and uncashed check processes a focus of audits in recent years.

Consider A Safe Harbor IRA Provision

One potential solution to this challenge is to add a Safe Harbor IRA (a.k.a. automatic rollover IRA) provision to your plan. This enables plan sponsors to remove smaller accounts from their plans automatically by rolling them into a Safe Harbor IRA. This provision allows plan sponsors to automatically roll former participant’s accounts with balances between $1,000-5,000 into an IRA — and in 2024, the upper limit increases to $7,000, thanks to SECURE 2.0. Automatic rollover IRAs can be advantageous for plan sponsors and participants. Plan sponsors benefit because removing small account balances can help: •Keep plan data clean •Reduce missing participant issues •Manage plan costs •Simplify participant disclosures and reporting •Limit fiduciary risk In addition, these provisions help plan sponsors address challenges associated with uncashed checks. And, if the plan document allows it, unvested employer profit sharing contributions can be applied to help plan sponsors pay for plan expenses and/or offset contributions.

Safe Harbor IRAs Help Participants

With a Safe Harbor IRA provision, the small accounts belonging to former employees periodically and automatically rollover into IRAs. It’s a feature that benefits participants in a variety of ways, and can: •Keep the former employee’s retirement savings intact •Preserve tax advantages •Provide more straightforward access to savings

Auto-Portability Networks: A Look into the Future of 401(k) Transfers

Automatic portability is a new option that was legitimately established under SECURE 2.0. This innovative feature allows a former employee's 401(k) account to be seamlessly transferred into the worker's new company's 401(k) without requiring the participants' express consent. Today, there are new Auto-Portability Networks being established, and the range of participating recordkeepers is expected to increase, which should facilitate the implementation of automatic portability for more workers.

Safe Harbor IRAs Complement Automatic Enrollment Features

Many 401(k) plans have automatic enrollment and escalation features – and soon all new plans will be required to have these features. While the push to add automatic savings features is likely to help Americans save more for retirement, it also has the potential to sharply increase the number of retirement plan accounts left behind. When an employee leaves, plan distribution options typically allow participants to: •Rollover into an IRA or a new employer’s plan. Rollovers help improve lifetime retirement outcomes because they preserve retirement savings and tax advantages, among other benefits. •Leave assets in the plan. Typically, participants with more than $1,000 in a plan account can opt to leave the savings in a previous employer’s plan. Some large defined contribution plans like to keep these assets in their plans because they provide scale, which can lower fees. The drawback is that plan sponsors have a fiduciary responsibility to keep track of former employees and must have a process in place to find missing participants. In contrast, sponsors of smaller plans often prefer not to keep the assets of former employees because having more accounts may increase plan costs and administrative responsibilities. •Take distributions in cash. About 41% of plan participants choose to cash out when they leave an employer, and the majority drain their savings.[2] It’s one of the most significant threats to retirement security. Safe Harbor IRA provisions offer a possible solution. When former employees fail to make distribution decisions, a Safe Harbor IRA enables the plan sponsor to remove those accounts from the plan, keeping plan data clean and costs low.

Is This Right for Your Plan?

In the world of 401(k) options, adding a Safe Harbor IRA provision to a company's plan can be an excellent arrow in its quiver. Especially for employers with high turnover rates. This option may help to reduce the number of small orphaned accounts left behind, potentially resulting in reduced plan costs and fiduciary risks. Safe Harbor IRAs are a friendly solution that may help to keep plan data clean, manage costs, reduce risks and improve retirement outcomes of former employees. [1] “Job Openings and Labor Turnover Archived News Releases.” U.S. Bureau of Labor Statistics. 6 Apr. 2023. [2] Wang, Yanwen, et al. “Cashing Out Retirement Savings at Job Separation.” 7 Nov. 2022.

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.

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

Interested in more?

Let's Talk

Guide to Retirement | Employee Newsletter: Your Money Check-up

Financial education has become increasingly important in today’s job market. Workers are looking to their employers for financial wellness resources. By providing financial education to your employees, you’ll be helping them build the skills they need to help manage their finances and plan for the future. This can lead to greater job satisfaction and loyalty, as well as increased productivity in the workplace.[1] This financial education resource focuses on key questions to help employees assess their financial situation, from overspending to retirement and beyond. Sharing this helpful resource with your employees can be a positive step toward alleviating financial stress in the workplace. [1] John Hancock. “Stress, Finances and Well-being.” 2023. Download the Guide

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. #5787267.1

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.

Interested in more?

Let's Talk

All Things 401k | How Can Our 401(k) Plan Help Us Attract and Retain Star Employees?

With thoughtful design features, you can structure a 401(k) plan that stands out in a time of talent scarcity and meets your employees’ needs. Looking to attract and retain high-quality talent in today’s competitive labor market? Enhancing your 401(k) plan design could be the answer. It could increase your employees’ retirement security and financial well-being while motivating talent to join and stay with the company long-term. With many businesses struggling with staffing issues, savvy executives are realizing that boosting their retirement plan benefits can be a valuable part of the solution. In fact, 35% of employers have already taken proactive steps to stand out from their competitors and ensure their employees remain happy and satisfied.^{^[1}^{^]} When it comes to successfully recruiting and retaining top talent, the competitiveness of your benefits package is key. As such, you should consider what employees value most when evaluating and implementing 401(k) plan design enhancements. A 401(k) plan that incorporates features that fit the company’s budget and the needs of your workforce is the best of both worlds. Automatic Features Make a Difference Plan design features such as immediate eligibility, automatic enrollment, auto-escalation and frequent plan entry points may help boost 401(k) plan competitiveness and make it easier for employees to save for retirement. Immediate eligibility means employees can participate in the 401(k) on their date of hire, rather than based on their age or time of service. Then these eligible employees could be automatically enrolled into the plan at a meaningful rate (8–10%). Plus employers who adopt automatic enrollment can claim a tax credit of $500 for the first three years.[2] Automatic entry helps increase retirement readiness, a benefit employers can highlight in the recruiting process. Going a step farther, employers could auto-escalate employee retirement saving by 1-2% per year until the employee is saving between 10-15% toward their retirement, the recommended savings rate per year by industry experts.[3] Finally, implementing flexible eligibility requirements and frequent entry points can boost participation rates and enhance overall employee satisfaction levels. The Match Matters Prospective and current employees value employer matching contributions. If an employee is considering multiple job offers, all else being equal, companies that offer a 401(k) with a match may have an advantage. It’s no wonder that more than half of employers (55%) are making matching contributions to employees’ retirement accounts.[4] Employers can help employees understand the value of retirement plan matching contributions by presenting them as part of their total compensation. It demonstrates an investment in your employees’ future, which can go a long way when it comes to attracting new talent and cultivating loyalty among your existing workforce. Enhance Recruiting with Accelerated Vesting Many employers have a waiting period for employees to become vested in employer contributions. One-year vesting periods are common; however, some employers delay letting employees vest in the company match and other employer contributions by as much as six years. Immediate vesting may offer more recruiting power than non-immediate vesting schedules. Again, employees considering more than one job opportunity may be more likely to accept one with a company that offers immediate vesting. Beyond the 401(k): Get Creative Offering a competitive 401(k) plan shows you’re committed to your employees’ financial well-being while helping them save for the future. Outside of a retirement plan benefit, specific financial rewards for longer-term employees can provide additional motivation for them to stay. These benefits may include restricted stock, cash balance plans and non-qualified deferred compensation plans. Offering creative benefits like these can help boost retention by making more tenured employees feel valued and rewarded while enhancing their total compensation. A well-constructed 401(k) plan can be a game-changer for companies looking to attract and retain top-quality talent. By investing thoughtfully in plan design and staying competitive with benefits packages, businesses can stand out from their competitors and gain the advantage needed to succeed in today's challenging labor market.

[1] WTW. “2022: The Next Evolution of DC Plans Survey.” Feb. 2022.

[2] IRS. “Retirement Plans Startup Costs Tax Credit.” 16 Jun. 2022. [3] Vanguard. “How America Saves 2022: Insights to Action.” 2022. [4] Vanguard. “How America Saves 2022: Insights to Action.” 2022.

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.

Interested in more?

Let's Talk

All Things 401k | Digital Communications - Employee Engagement Edition

After the events of the last few years, employers are becoming more aware of the positive impact of financial wellness. A well-crafted financial wellness program can provide employees with the knowledge and tools to understand why, when and how to achieve savings success. Before starting a program, it’s important to understand the implications of financial stress in the workplace, how much it might be costing you and the value behind financial education on an ongoing basis. Read about all the best ways to engage your employees in our most recent newsletter for employers and plan sponsors. Open the Newsletter

JULIA SANDERS

AIF®, CPFA® | Retirement Relationship Manager

SCOTT HIGGINS

AIF®, CFP®, CPFA® | Financial Advisor

This material and the opinions voiced are for general information only and are not intended to provide speciﬁc advice or recommendations for any individual or entity. To determine what is appropriate for you, please contact your Rose Street Financial Professional. Information obtained from third-party sources are believed to be reliable but not guaranteed.

Investments in securities involve risks, including the possible loss of principal. When redeemed, shares may be worth more or less than their original value.

By accessing any links above, you will be connected to third party web sites. Please note that Rose Street Advisors, LLC, is not responsible for the information, content or product(s) found on third party web sites.

Securities and Investment Advisory Services Offered Through M Holdings Securities, Inc. A Registered Broker/Dealer and Investment Adviser, Member FINRA/SIPC. Rose Street Advisors, LLC is independently owned and operated. File #: 5708515.1

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All Things 401k | Digital Communications - The Business Case for Financial Wellness

If you are a company leader, you know that happy and healthy employees can often lead to less turnover, strong workplace culture and greater productivity. However, these days, financial stress has become an all-too-common problem among employees. Financially stressed employees are two times more likely to leave their jobs. In addition, they maybe spend around 3 hours a week dealing with personal financial issues.[1] Consider the case for a financial wellness program to help remedy financial stress and strengthen your bottom line.

[1] PwC. “2022 PwC Employee Financial Wellness Survey.” May 2022.

JULIA SANDERS

AIF®, CPFA® | Retirement Relationship Manager

SCOTT HIGGINS

AIF®, CFP®, CPFA® | Financial Advisor

This material and the opinions voiced are for general information only and are not intended to provide speciﬁc advice or recommendations for any individual or entity. To determine what is appropriate for you, please contact your Rose Street Financial Professional. Information obtained from third-party sources are believed to be reliable but not guaranteed.

Investments in securities involve risks, including the possible loss of principal. When redeemed, shares may be worth more or less than their original value.

By accessing any links above, you will be connected to third party web sites. Please note that Rose Street Advisors, LLC, is not responsible for the information, content or product(s) found on third party web sites.

Securities and Investment Advisory Services Offered Through M Holdings Securities, Inc. A Registered Broker/Dealer and Investment Adviser, Member FINRA/SIPC. Rose Street Advisors, LLC is independently owned and operated. File #: 5708509.1

Interested in more?

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