The Washington State Department of Commerce said Monday that it has launched the nation’s first online portal, the Retirement Marketplace, that allows businesses and individuals to comparison shop for low-cost, state-verified retirement savings plans.
Washington Gov. Jay Inslee said in announcing the online portal that “access to affordable retirement savings plans should be available to everyone, especially small businesses and workers in today’s gig economy,” adding that he’s “proud that Washington state is leading the way” to such access.
The Retirement Marketplace will help approximately 2 million Washingtonians who do not have access to retirement savings plans through their work.
Approximately 131,000 Washington businesses, most of them small businesses, don’t offer retirement plans to employees, mainly because of their cost and complexity.
Sen. Mark Mullet, a Democrat who sponsored SB 5826, the legislation that created the marketplace, stated that as a small-business owner himself, “I firmly believe that many, if not most, want to offer competitive benefits for employees, but the complexity and fees can make it cost-prohibitive to do so.”
The American Council of Life Insurers applauded the new online marketplace, stating that it provides “a one-stop shop for comparing online a range of retirement plans, such as 401(k)s, IRAs and simplified retirement plans, from many financial services providers.”
Each plan listed on the Retirement Marketplace meets “strict criteria” established by the Washington State Legislature in that they were reviewed by officials at the Department of Financial Institutions and/or the Office of the Insurance Commissioner; do not charge administrative fees to employers; do not charge enrollees more than 1% in total annual administrative fees; and have gone through an annual renewal process to ensure the plan and provider remain in good standing.
Participation in the Retirement Marketplace is voluntary for both employers and employees. The state’s Department of Commerce administers the Retirement Marketplace, but enrollment takes place with the private retirement plan provider.
— Check out State-Run Retirement Plans May Not Be the Best Option for Small-Business Owners on ThinkAdvisor.