There are many reasons why an employer of any size might choose not to offer a retirement plan at any particular time, but the coverage gap among smaller employers has drawn particular attention.
In fact, last week companion bills were introduced in the House and Senate intended to, among other things, encourage more small employers to offer retirement plans.
This week we asked NAPA Net readers to weigh in on what was the largest obstacle to smaller employers offering a workplace retirement plan.
The most cited response: plan administration was too burdensome, though it barely outpaced “a lack of knowledge about retirement issues.”
Other top cited barriers to plan adoption were:
- They view retirement plans as too complex and don't want to deal with the issues.
- Costs too much to set up and administer.
- It's too complicated and too costly.
- Lack of profit for funding any contributions/expense of maintaining plan.
- All of the notices are burdensome and costly.
- No compelling business reason to do so.
- Are maxed out running their enterprise, unaware that responsibilities can be off-loaded, counting on their business to be their retirement
- Don't understand the plan options and what they can do for them. Few are being spoken to by knowledgeable people.
Indeed, among the top responses there was a distinct sense that smaller employers don’t know what’s involved, but fear what’s involved, and in any event are concerned about the costs and work they think might be associated with setting up and running a plan.
All things that retirement plan advisors could surely help remedy.
Thanks to everyone who participated in our poll!
Got a suggestion for a future poll? Post it in the comments below, or email me at [email protected].
