FSI Statement on DOL’s Final State-Run Retirement Plan Rule

Today the Department of Labor (DOL) released its final rule on state-run retirement plans. Below is a statement from Financial Services Institute (FSI) Executive Vice President & General Counsel David Bellaire:

“We are currently reviewing the Department of Labor’s final rule on state-run retirement plans. While there is no question of the importance of retirement savings and access to financial advice, we have concerns about the unintended consequences this rule may have for small business, the states and investors. The financial services industry already provides numerous, reasonably priced retirement savings options for Main Street Americans, including IRAs which are readily accessible. The leading reasons for not saving for retirement – a lack of income or other pressing financial needs – will not be addressed by state-run plans. We are also concerned that some employers may choose to drop strong existing plans in order to reduce their costs. This would be harmful to impacted workers because state-run plans do not provide for the matching funds that common in employer-based plans. Finally, the true cost of mandatory plans is unknown, and FSI believes the costs and time required for administration of the plans will prove overly burdensome for small employers and state governments.”