Compliance November 23, 2021

Launch Announced for MarylandSaves State-Run Retirement and Emergency Savings Program

The plan will automatically convert savers’ assets to a monthly paycheck at retirement unless they opt out of doing so.

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Josh Gotbaum, chair of the Maryland Small Business Retirement Savings Program, and a former director of the Pension Benefit Guaranty Corporation (PBGC), announced that MarylandSaves will begin offering its new automatic workplace retirement and emergency savings program next summer.

Building on the experiences of programs in other states, MarylandSaves will be the first such state-run program that helps people have reliable income after they retire, according to the announcement. Savers in the program will automatically have their assets converted into a monthly paycheck at retirement age unless they choose otherwise. They will also have an option to increase their Social Security payments by deferring Social Security enrollment and receiving their MarylandSaves funds first instead.

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The program also differs from other state programs in that it focuses on helping employees build emergency savings first. Initially, funds will go into an emergency savings account using the Lincoln Financial Stable Value Fund. This fund currently has a guaranteed interest rate of 1.4% and there are no separate investment fees. After the emergency savings account has been funded, the participant’s contributions will be invested in the age-appropriate BlackRock target-date fund (TDF). Optional investment choices include an income fund (State Street Aggregate Bond Index Fund, Class K) and a growth fund (T. Rowe Price Global Growth Stock Fund).

MarylandSaves is a state-sponsored program designed to make it easy for businesses to offer their employees a voluntary, automatic, low-cost, portable retirement and emergency savings plan. Under Maryland law, established businesses that use an automatic payroll system are required either to offer a retirement plan or to sign their employees up for the MarylandSaves program. Businesses that do so will receive $300 per year via a waiver of the Maryland business annual filing fee. Employers will have no payment obligations, have no federal reporting requirements and will pay nothing to MarylandSaves for the service.

Employee participation is completely voluntary. Employees are automatically enrolled, but they can withdraw funds, choose investment options, change their savings amount or opt out entirely at any time. The announcement says account fees will be lower than commercial alternatives, and savers keep their accounts when they change jobs.

The program will be administered by a team composed of Vestwell, Sumday and BNYMellon, which the announcement says were selected after a rigorous competitive process. All savings will be professionally managed at negotiated rates by BlackRock, State Street Global Advisors, Lincoln Financial Group and T. Rowe Price.

Maryland joins other U.S. states (California, Connecticut, Illinois, Massachusetts New Jersey, New York, Oregon, Vermont and Washington) and two cities (Seattle and New York City) that have enacted legislation or set up the retirement programs to help close the retirement plan coverage gap. The states’ efforts are in addition to efforts from a new generation of providers—i.e., nontraditional recordkeepers—that are using technology to make offering a retirement plan cheaper for businesses and to bring employers more flexibility, as well as legislative efforts to ease administration through pooled employer plans (PEPs).

A survey from the National Institute on Retirement Security (NIRS) finds strong support for new state-facilitated retirement programs aimed at helping workers without employer-provided plans save for retirement. Seventy-two percent of Americans agree that state-facilitated retirement savings programs are a good idea, with high support across party and generational lines. Three-quarters of survey respondents say they would participate in these retirement programs if they were offered in their state, and most express favorable views of features such as portability and low fees.

Products November 23, 2021

Itzoe Launches Getre(k)ruited.com Industry Networking Platform

Josh Itzoe says the idea for his new venture—a networking and hiring platform focused on firm culture and professional preferences—came from conversations he has had since selling his stake in Greenspring Advisors.

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Back in April, Josh Itzoe backed away from Greenspring Advisors, the registered investment adviser (RIA) firm he founded in collaboration with Pat Collins.

In a recent conversation with PLANADVISER, Itzoe admitted to taking a few months to “sit on the couch and recuperate” after nearly 16 busy years at Greenspring, but he says he quickly began to feel bored and restless, leading him to consider what might come next.

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His first project was to launch a fiduciary-focused consulting endeavor called FiduciaryWor(k)s, a service that helps retirement plan sponsors manage risk and drive better outcomes for employees in the areas of fiduciary responsibility and workplace retirement savings. Now, he has launched a new industry networking and job search platform called Getre(k)ruited, which is designed to help connect retirement plan services providers (i.e., advisers, recordkeepers, third-party administrators [TPAs], etc.) with talent that shares their personal and professional values.

As Itzoe explains it, the Getre(k)ruited platform allows job seekers to search for opportunities by filtering though some 30-plus predefined company values, as well as according to company type, location, job function (advisory, investment management, marketing, operations, etc.), workplace model (in-person, remote, hybrid, etc.) and work status (full-time, part-time, hourly, contract, etc.). Some of the values coded into the platform include the following:

  • Accountability Is Critical
  • Apprenticeship/Mentorship
  • Awesome Work Environment
  • Clients/Customers Come First
  • Committed to Personal Growth
  • Community Involvement
  • Extra Perks
  • Fast-Paced Environment
  • Flexible Work Arrangements
  • Good for Parents
  • Long-Tenured Employees
  • Open Communication
  • Promotes from Within
  • Tech-Forward
  • We Love Interns
  • We Pay Well
  • Work/Life Balance

“The genesis of the idea came from several conversations,” Itzoe explained. “Specifically, three different people came to me over the past six months or so, asking me about what it was like to work in the retirement business and how they can find new opportunities. They picked my brain about what my experience has been and what my advice to them would be. I coached them through some of this stuff and gave them recommendations, and I also let them know that I could help make introductions. Lo and behold, these three people got some great jobs, and it was such a gratifying experience.”

Beyond working with individual job seekers, Itzoe said, the platform is also meant to help employers. In signing up for the platform, employers must select their eight top values from the list of 30-plus. 

“If we can help companies understand their own unique values, and then help top talent to be able to search for jobs and companies that have core values that match their preferences, it’s going to be a win-win scenario,” Itzoe said.

Itzoe said the platform will be built out in the weeks and months ahead to help participating companies showcase their culture and their values.

“At Greenspring, we used social media and we used our web presence both to address prospective clients but also to address prospective hires,” Itzoe explained. “That was always something we were focused on, and it really helped us to be successful, and I think other firms can emulate that.”

Itzoe said another forthcoming feature on the platform will be a repository for internships and entry-level positions, meant to help the next generation enter the industry.

“I believe we can help to build out a new type of talent pipeline,” he said. “The younger generation is really big on values and culture and purpose—even more than us veterans.”

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