Bill Overview
Title: Simplifying Small Business Retirement Savings Act
Description: This bill requires pooled employer retirement plans to designate a named fiduciary to collect contributions to the plan and implement written contribution collection procedures that are reasonable, diligent, and systematic. Current law requires a plan to designate one or more trustees to perform these tasks. The bill also revises the requirements for combined annual reporting for a group of plans.
Sponsors: Sen. Hickenlooper, John W. [D-CO]
Target Audience
Population: Individuals involved with small businesses utilizing pooled employer retirement plans
Estimated Size: 20000000
- The bill targets small businesses utilizing pooled employer retirement plans.
- It seeks to simplify certain fiduciary responsibilities and reporting requirements for these businesses.
- The bill affects small business owners, employees, and entities involved in managing pooled employer retirement plans.
- While small business definitions vary globally, the core impact will be on businesses that rely on such retirement savings plans.
Reasoning
- The policy primarily targets small business owners and employees involved in pooled employer retirement plans.
- Not all small businesses utilize pooled employer retirement plans, so the direct impact will vary based on exposure to these systems.
- The policy's changes to fiduciary roles and reporting might mainly affect small business employers and managerial roles rather than all employees.
- The diversity in small businesses means responses will vary, from those with no impact to those with potentially significant benefits.
- With 20 million estimated Americans involved, the policy aims to reduce administrative burdens, which may indirectly improve employee satisfaction and efficiency.
Simulated Interviews
Small Business Owner (Austin, TX)
Age: 45 | Gender: female
Wellbeing Before Policy: 7
Duration of Impact: 5.0 years
Commonness: 10/20
Statement of Opinion:
- The policy seems helpful in reducing paperwork, which is always a challenge.
- Anything that can streamline processes is beneficial.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 7 |
| Year 2 | 8 | 7 |
| Year 3 | 8 | 7 |
| Year 5 | 9 | 7 |
| Year 10 | 9 | 7 |
| Year 20 | 8 | 7 |
Software Engineer (San Francisco, CA)
Age: 30 | Gender: male
Wellbeing Before Policy: 8
Duration of Impact: 0.0 years
Commonness: 12/20
Statement of Opinion:
- I don't see this affecting my day-to-day work or wellbeing.
- Our HR handles retirement plans, so this policy change is a non-issue for me.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 8 | 8 |
| Year 2 | 8 | 8 |
| Year 3 | 8 | 8 |
| Year 5 | 8 | 8 |
| Year 10 | 8 | 8 |
| Year 20 | 8 | 8 |
Human Resources Manager (Chicago, IL)
Age: 50 | Gender: female
Wellbeing Before Policy: 6
Duration of Impact: 10.0 years
Commonness: 8/20
Statement of Opinion:
- Streamlining the fiduciary process would be a considerable relief.
- Reducing reporting complexity directly impacts my workload in a positive way.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 6 |
| Year 2 | 7 | 6 |
| Year 3 | 8 | 6 |
| Year 5 | 8 | 6 |
| Year 10 | 9 | 6 |
| Year 20 | 8 | 6 |
Financial Advisor (Denver, CO)
Age: 38 | Gender: male
Wellbeing Before Policy: 7
Duration of Impact: 3.0 years
Commonness: 9/20
Statement of Opinion:
- This policy is a mixed bag; while I appreciate the streamlined processing, it might reduce my client base relying on detailed advisory services.
- Overall, less complexity is good for clients.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 7 |
| Year 2 | 8 | 7 |
| Year 3 | 8 | 7 |
| Year 5 | 7 | 7 |
| Year 10 | 7 | 7 |
| Year 20 | 7 | 7 |
Retail Worker (Seattle, WA)
Age: 26 | Gender: other
Wellbeing Before Policy: 5
Duration of Impact: 2.0 years
Commonness: 15/20
Statement of Opinion:
- I mostly care about the security and stability of my retirement savings.
- Policy changes that don't directly impact my benefits seem irrelevant.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 5 | 5 |
| Year 2 | 5 | 5 |
| Year 3 | 5 | 5 |
| Year 5 | 5 | 5 |
| Year 10 | 5 | 5 |
| Year 20 | 5 | 5 |
Retired Small Business Owner (Miami, FL)
Age: 60 | Gender: female
Wellbeing Before Policy: 8
Duration of Impact: 1.0 years
Commonness: 11/20
Statement of Opinion:
- It's a positive change, though it comes a bit late for me.
- I recall the reporting being a hassle, so this is welcome.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 8 | 8 |
| Year 2 | 8 | 8 |
| Year 3 | 8 | 8 |
| Year 5 | 8 | 8 |
| Year 10 | 8 | 8 |
| Year 20 | 8 | 8 |
Business Consultant (New York, NY)
Age: 40 | Gender: male
Wellbeing Before Policy: 7
Duration of Impact: 4.0 years
Commonness: 7/20
Statement of Opinion:
- Streamlining administrative tasks will free up resources for small businesses to focus on growth.
- This policy might indirectly boost business efficiency and morale.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 7 |
| Year 2 | 8 | 7 |
| Year 3 | 8 | 7 |
| Year 5 | 9 | 7 |
| Year 10 | 8 | 7 |
| Year 20 | 8 | 7 |
CPA specializing in retirement plans (Los Angeles, CA)
Age: 58 | Gender: female
Wellbeing Before Policy: 6
Duration of Impact: 3.0 years
Commonness: 6/20
Statement of Opinion:
- Changes in compliance could influence my consulting practice, hopefully in a beneficial way by reducing unnecessary complexities.
- Compliance burdens often strain business owners.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 6 |
| Year 2 | 7 | 6 |
| Year 3 | 7 | 6 |
| Year 5 | 8 | 6 |
| Year 10 | 7 | 6 |
| Year 20 | 7 | 6 |
Restaurant Manager (Boston, MA)
Age: 32 | Gender: male
Wellbeing Before Policy: 6
Duration of Impact: 6.0 years
Commonness: 9/20
Statement of Opinion:
- Our retirement plan management is complicated, so simplification is appreciated.
- As long as it doesn't compromise on quality of benefits, this is a positive.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 6 |
| Year 2 | 7 | 6 |
| Year 3 | 7 | 6 |
| Year 5 | 8 | 6 |
| Year 10 | 8 | 6 |
| Year 20 | 7 | 6 |
Freelance Graphic Designer (Portland, OR)
Age: 29 | Gender: female
Wellbeing Before Policy: 7
Duration of Impact: 0.0 years
Commonness: 14/20
Statement of Opinion:
- I don't think this policy change affects me as a freelancer.
- My work is not impacted by small business retirement plans or their management.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 7 |
| Year 2 | 7 | 7 |
| Year 3 | 7 | 7 |
| Year 5 | 7 | 7 |
| Year 10 | 7 | 7 |
| Year 20 | 7 | 7 |
Cost Estimates
Year 1: $12000000 (Low: $8000000, High: $15000000)
Year 2: $9000000 (Low: $6000000, High: $12000000)
Year 3: $6000000 (Low: $4000000, High: $8000000)
Year 5: $4000000 (Low: $2000000, High: $6000000)
Year 10: $2000000 (Low: $1000000, High: $4000000)
Year 100: $0 (Low: $0, High: $1000000)
Key Considerations
- The gradual phase-out of initial administrative setup costs for the named fiduciary role.
- Long-term cost savings potential from streamlined reporting processes.
- Businesses with existing efficient fiduciary and reporting practices may see less tangible benefits from these changes.