NARPP Introduces Icon – The First Retirement Plan Built For The Modern Workforce
This press release features multimedia. View the full release here: http://www.businesswire.com/news/home/20171013005154/en/
Fees Comparison Over 30 Years. Icon compared to the average target date fund. (Graphic: Business Wire)
Icon is packed with features that address the needs of these uncovered and independent workers including: full portability, institutionally priced investments, and a tech-forward simplified interface. All this is wrapped-in support designed to help people navigate a retirement savings journey that can last up to 45 years.
Icon – Built On Behavioral Finance and Design Thinking
Icon is a hybrid plan that combines the best aspects of an employer sponsored plan (e.g., 401(k)), along with the flexibility of a self-directed plan (IRA). The result is a high quality, low cost plan born out of behavioral science and human centered design that motivates people to save. Icon is a scalable, sustainable solution and is an entirely new paradigm for providing retirement benefits to a labor force that is rapidly evolving away from the traditional employer-employee model.
“The percentage of employees offered any retirement plan by their employer has plummeted over the last fifteen years from 64% to 43%,” said
Right now there are at least 55 million working Americans who don’t have access to an employer sponsored savings plan. Without this type of support, people are very unlikely to save. There are two main categories of uncovered workers, 1) employees of small businesses that don’t offer a retirement plan, and 2) independent workers who don’t have a traditional relationship with an employer. Icon is designed to be a solution for both groups.
With Icon, everybody wins:
- Individuals can join independently.
- Small employers can implement Icon as a payroll deduction with no legal or federal filing requirements, no plan administration and no on-going costs.
- Gig platforms companies can make Icon available at the pay level without triggering employment status changes.
- Large employers can make Icon available to their independent workforce as a payroll deduction without triggering ERISA or employment status changes.
Companies can use Icon as an employer facilitated retirement plan. This means they do not have the legal burdens or federal filing requirements of a 401(k) plan – and there is no cost to the company for using Icon. Contributions are transacted at the payroll level, making it easier for workers to save. Icon exists within the current regulatory structure of a payroll IRA, and offering Icon will not trigger independent contractor status or voluntary work arrangements, thus paving the way for gig platforms to offer Icon at the payment level for workers who use their platforms.
NARPP has partnered with Aspire, a leading recordkeeper who specializes in payroll deduct IRA’s to provide plan administration. “Aspire shares NARPP’s deep commitment to participant advocacy and is very excited to collaborate in the design and ongoing support of such an innovative solution. Icon is thoughtfully designed to help remediate America’s retirement coverage crisis,” said
High Quality, Low Cost Investments
People participating in Icon will have access to institutionally priced funds, something that until now has been unavailable to the average person.
Icon’s plan investments are provided by world-class asset managers, including
Dimensional provides a strong lineup of diversified, low-cost options for participants. “Dimensional is honored to be part of this innovative solution, which will positively impact millions of Americans saving for retirement,” says
To put the impact of this preferential pricing into perspective, a person saving
“SSGA and NARPP share a common vision of bringing retirement access and coverage to small businesses and uncovered workers in America,” said
Pricing, Availability & Technical specs
- Users can pre-order Icon beginning
Wednesday November 1 , with onboarding startingJanuary 2018 . - Icon users will pay approximately
$5.00 per month in fees, which includes, recordkeeping, custodial service, customer support, education and help with holistic financial wellness. - Employer’s using Icon will not be subject to ERISA and other federal filings requirements.
- Icon uses auto-default to place savers into an age appropriate target date fund, savers can also opt out of the TDF and select their own mix of funds.
About NARPP
NARPP (
1 Morningstar average
View source version on businesswire.com: http://www.businesswire.com/news/home/20171013005154/en/
NARPP (the
President
www.NARPP.org
Source: NARPP
Trump’s health care order: Can it make NJ insurance cheaper?
Covered California To Add Surcharge To Silver Plan In 2018
Advisor News
Annuity News
Health/Employee Benefits News
Life Insurance News