Plan Sponsor News

The Mutual of America Foundation is proud to recognize the six winners of its annual Community Partnership Award. The award encourages nonprofits that work together with the public, private and social sectors to build healthier and more equitable communities.

The 2022 Thomas J. Moran Award winner is Patriot PAWS Prison Training Program of Rockwall, TX. The unique partnership with the Texas Department of Criminal Justice engages inmates in raising and training service dogs for the benefit of American Veterans. As the recipient of this national award, Patriot PAWS received $100,000 and a documentary about the program. Watch the video to learn more.

This was also the first year of the Frances R. Hesselbein Award, commemorating the late Mutual of America Board Member and Medal of Freedom recipient who devoted her career to advancing a more just and equitable society. The recipient is the Young Center for Immigrant Children’s Rights for their Child Advocate Program in partnership with Bethany House of Hospitality and Viator House of Hospitality. It is the only organization in the nation that provides independent Child Advocates to support unaccompanied and separated immigrant children in deportation proceedings. As the recipient of the award, the Young Center received $50,000.

Four other organizations were named Honorable Mention Award recipients, each receiving $50,000. They are:

Give Items of Value
Neighborhood Vacancy Initiative
Safer Tomorrows Road Map
Work and Life Skills Training Program

Since its inception in 1996, the Mutual of America Foundation Community Partnership Award has recognized 256 partnerships from cities and towns across America. Like so many of our clients working in the nonprofit community, Mutual of America is dedicated to having a direct, positive impact on society. The work of all the winners is a shining example of how partnerships can make a real difference in the lives of people in need.

Halfway into 2023, how do you think your employees are feeling about their finances? According to the Employee Benefit Research Institute’s 2023 Retirement Confidence Survey, the number of workers who feel very confident in their ability to have enough money to live comfortably in retirement has declined 10% since last year.¹ This is just one of many signs that it’s more important than ever for plan sponsors to play a role in promoting financial wellness in the workplace.

Concerning signs from employees
While a majority of workers say they are personally saving money for retirement, 1 in 3 workers feel that their money won’t be able to keep up with inflation in retirement.^2,3 Additionally, 73% of workers are worried that they will need to make substantial cuts to their spending due to inflation.⁴

Resources to help boost employee financial confidence
Interestingly, according to the EBRI, only half of workers have tried to calculate how much money they will need in retirement.⁵ Mutual of America’s Retirement Income calculator can help your employees determine how much monthly income their retirement savings may provide.

A few more suggestions:

Encourage employees to increase their retirement plan contributions by helping them understand the impact their contributions have on their paychecks.
If you provide a Roth option, give employees the tools to calculate which plan type may be best for their retirement needs.
Further, encourage basic financial knowledge to help your employees stay engaged and in control of their retirement goals.

The steps you take now can help your employees feel more confident and secure well beyond Professional Wellness Month. Talk to your local Mutual of America representative to learn more about helping your employees achieve their retirement goals.

¹EBRI. Greenwald Research 2023 Retirement Confidence Survey. https://www.ebri.org/docs/default-source/rcs/2023-rcs/2023-rcs-short-report.pdf?sfvrsn=7c8d392f_6. Page 11, figure 1.

²EBRI. Greenwald Research 2023 Retirement Confidence Survey. https://www.ebri.org/docs/default-source/rcs/2023-rcs/2023-rcs-short-report.pdf?sfvrsn=7c8d392f_6. Page 27, figure 17.

³EBRI. Greenwald Research 2023 Retirement Confidence Survey. https://www.ebri.org/docs/default-source/rcs/2023-rcs/2023-rcs-short-report.pdf?sfvrsn=7c8d392f_6. Page 13, figure 3.

⁴EBRI. Greenwald Research 2023 Retirement Confidence Survey. https://www.ebri.org/docs/default-source/rcs/2023-rcs/2023-rcs-short-report.pdf?sfvrsn=7c8d392f_6. Page 17, figure 7.

⁵EBRI. Greenwald Research 2023 Retirement Confidence Survey. https://www.ebri.org/docs/default-source/rcs/2023-rcs/2023-rcs-short-report.pdf?sfvrsn=7c8d392f_6. Page 26, figure 16.

Recent changes to required minimum distribution (RMD) rules in the SECURE 2.0 Act¹ could impact your retirement plan participants this year. As a plan sponsor, you can help employees understand these new rules and their effects on retirement income.   

A rise in the distribution age

As of January 1, 2023, the age that plan participants must start taking RMDs has increased from 72 to 73. With this change, participants will have an additional year to delay taking a mandatory withdrawal of deferred savings from their retirement accounts. The age for RMDs will rise again, to 75, in 2033.

Right now, plan participants should know:

If they turned 72 in 2022 or earlier, they must continue taking RMDs as scheduled.
If they are turning 72 in 2023 and have already scheduled their withdrawals, they may want to update their withdrawal plan.

A decline in penalties

Also starting in 2023, the penalty for not taking an RMD for IRAs, has dropped from 50% to 25% of the RMD amount, and to 10% if corrected in a timely manner.

Adjustments to Roth accounts 

Starting in 2024, RMDs will no longer be required from Roth accounts in employer retirement plans. Contact your local Mutual of America representative with any questions you may have about how the changes in RMD regulations will affect your employees.

¹United States Senate Committee on Finance. SECURE 2.0 Act of 2022, Title 1 – Expanding Coverage and Increasing Retirement Savings. https://www.finance.senate.gov/imo/media/doc/Secure%202.0_Section%20by%20Section%20Summary%2012-19-22%20FINAL.pdf.

Sources:

¹EBRI 2023 RCS Fact Sheet #3, Preparing For Retirement In America. https://www.ebri.org/docs/default-source/rcs/2023-rcs/rcs_23-fs-3_prep.pdf?sfvrsn=778d392f_4. Page 1, figure 1.

²Employee Benefit Research Institute and Greenwald Research. 2023 Retirement Confidence Survey. https://www.ebri.org/docs/default-source/rcs/2023-rcs/2023-rcs-short-report.pdf?sfvrsn=7c8d392f_6.