DOL Issues Final Rule on Association Retirement Plans
The Labor Department on July 29 issued final rules to help
small businesses offer retirement plans to their workers via
association retirement plans.
Preston Rutledge, assistant secretary for Labor’s
Employee Benefits Security Administration, said on a
press call that in addition to the final rule, Labor has
issued a request for information on other kinds of multiple
“The purpose of this rule and the reason we wrote this
rule is because there are a lot of smaller employers in
particular that would like to set up a 401(k) plan for their
workers, but they don’t for a number of reasons. One is
expense; probably an even larger problem of concern to
a smaller employer is the administrative [duties], the
paperwork and the IRS filings that go along with offering
Due to the lack of small businesses offering 401(k) plans,
“there are around 38 million employees of smaller and mid-
sized employers that are not covered by a 401(k) at work,”
Labor issued the proposed rule last October. The effective
date for the final rule is Sept. 30.
The rule basically allows an association — for example, a
local chamber of commerce — to set up a 401(k), Rutledge
explained. The association will be running the 401(k) on
behalf of the employers.
Another benefit, Rutledge said, “is a much larger pool
of assets under management; a situation like this more
assets means lower fees; lower fees means your account
The other kind of multiple employer plan in the final rule is
the multiple employer plan run by a professional employee
organization, or PEO, Rutledge said.
Rutledge also noted that Labor’s rule “meshes” with
the Secure Act retirement bill that’s currently tied up in
Nationwide Advisory Solutions |
Designed specifically for RIAs and fee-based advisors, NARIASM
allows you to support your clients’ goal to live confidently once
the big day arrives. With a comprehensive line up of professionally
managed investment options and retirement income stream
protection, this variable annuity can help you take much of the
uncertainty out of retirement planning. Because the last thing your
clients should have to worry about is having enough money.
and the potential for
Variable products are sold by prospectus. Carefully consider the investment objectives, risks, charges and expenses. The product and underlying
fund prospectuses contain this and other important information. Investors should read them carefully before investing. To request a copy, go to
nationwideadvisory.com or call 1-866-667-0564.
Nationwide Advisory Retirement Income Annuity is a variable annuity issued by Nationwide Life Insurance Company, Columbus, Ohio. The general
distributor is Nationwide Investment Services Corporation, member FINRA.
Nationwide, the Nationwide N and Eagle, Nationwide is on your side, Nationwide Advisory Income Retirement Annuity and NARIA are service marks of
Nationwide Mutual Insurance Company. © 2019 Nationwide
ASV-0112AO (4/19) FOR FINANCIAL PROFESSIONAL USE ONLY. NOT FOR PUBLIC USE