The American Bankers Association today expressed support for a recently finalized Department of Labor interim final rule implementing section 203 of the bipartisan Secure Act of 2019 to require that defined contribution plans (such as 401(k) plans) include two lifetime income illustrations on a plan participant’s pension benefit statement at least once every 12 months. The IFR, for which the DOL is seeking public comment for further modification, is intended to help workers better gauge their ability to save for a secure retirement.
ABA has long supported DOL efforts to encourage plans to provide financial information to retirement savers that will assist them in planning for a secure retirement, and noted in its comment letter that the IFR provides a means for plan administrators and service providers to furnish this information while significantly reducing their potential liability exposure.
ABA also recommended several additional changes that would improve regulatory functionality and provide greater compliance certainty. These changes include confirming that providing lifetime income illustrations and related communications and services are investment education and do not constitute investment advice, providing flexibility on the use of model language, and undertaking agency-led approaches to increase participant understanding and engagement in the retirement savings process.