Products February 26, 2013

RolloverSystems Rebrands, Expands Services

RolloverSystems has rebranded to Retirement Clearinghouse (RCH) and is expanding its suite of services.

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RCH’s expanded suite of services addresses a significant gap in workplace-based retirement savings programs that results in job changers stranding their accounts in their old defined contribution and defined benefit plans; attempting the confusing task of rolling over their savings by themselves; or cashing out of the retirement system altogether, incurring penalties and taxes that severely compromise their retirement saving efforts.  

RCH provides personalized intervention from start to finish that cuts cashouts and stranded accounts among job-changing participants, including those with low account balances who are at greatest risk of cashing out.   

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“This new strategy will result in a dynamic change in the retirement industry and we believe will be a solution for millions of 401(k) account holders to better manage their retirement assets,” said Johnson. “I am very excited that Retirement Clearinghouse CEO J. Spencer Williams has authored this unique mission for the company and believe his leadership will guide the future success of Retirement Clearinghouse.” 

RCH’s services include: 

  • Assisted Roll-In Service: Sponsors help new hires consolidate their savings into their new retirement accounts, increasing plan assets and average account balances, which can lower plan costs. Participants manage their retirement savings more easily and save money by consolidating their accounts and eliminating redundant account fees.  
  • Automatic Rollover (ARO) Plus: A patent-pending service that includes a multivendor, choice-oriented Safe Harbor and rollover individual retirement account (IRA) platform and proactively and automatically consolidates participants’ Safe Harbor accounts with their new employer’s defined contribution (DC) plan. The service has no minimum balance requirements and an enhanced address search and verification service, eliminating lost and missing participants and the problem of uncashed checks.  
  • Assisted Rollover Service: Sponsors reduce the number and associated costs and risks of terminated participant accounts in their defined contribution plans with a voluntary program that combines comprehensive support with exceptional choice. 

Retirement Clearinghouse also offers specialty services for plan sponsors who need to help retirement plan participants as a result of a merger, acquisition or plan termination; to locate missing participants; and to solve uncashed check problems.   

The company works with a sponsor’s existing recordkeeper and conforms to retirement plan rules. Retirement Clearinghouse services are available to both defined contribution and defined benefit (DB) plan sponsors.  

For more information on Retirement Clearinghouse, visit www.RCH1.com.
Products February 26, 2013

Mercer Launches Pension Buyout Index

Mercer launched the Mercer U.S. Pension Buyout Index, featuring monthly average pricing information from independent third-party insurers.
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The index is designed to help pension plan sponsors evaluate the relative cost of a buyout by an insurer of retiree liabilities of a defined benefit (DB) pension plan. It allows plan sponsors to see how the approximate current cost of the purchase of annuities changes over time and to evaluate the cost of a buyout against the administrative costs, Pension Benefit Guaranty Corporation (PBGC) premiums and risks of holding pension fund liabilities for retirees.  

The index shows the estimated buyout cost for “Retirees Only” transfers on a monthly basis for a 12-month period beginning December 31, 2011. Pricing does vary over time, affected not only by interest rate movements, but also by insurance companies’ capacity and desire to take on additional liabilities.   

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“There are times when it’s cheaper to annuitize. But to act, plan sponsors need to understand how real-world pricing can change from month to month”, said Leah Evans, a principal in Mercer’s Financial Strategy Group.“The Mercer U.S. Pension Buyout Index will help plan sponsors understand cost trade-offs of a buyout versus the administrative expenses, PBGC premiums and risk factors of holding pension liabilities on their own books. When these factors are taken into account, annuitization may be attractive. Indeed, in some situations, the cost to buyout these liabilities through annuities may actually be lower than the accounting liability plus capitalized expenses. The reward may be a significant reduction in balance sheet risk. We think this tool will be a valuable resource to plan sponsors as they consider whether the buyout option is right for them and gauge the timing of such a transaction.”  

The Mercer U.S. Pension Buyout Index may be accessed at www.mercer.com/US-pension-buyout-index.

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