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Financial planner shares retirement plan guidance

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Associations | Business Practices | Education
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As a growing number of states enact retirement savings plans for the private sector, a certified financial planner is offering guidance on how individual retirement accounts (IRA) differ from the Society of Collision Repair Specialists’ (SCRS) 401(k) plan.

A newly-published Center for Retirement Initiatives at Georgetown University report details how 47 U.S. states have “acted to implement, study or introduce legislation to establish state-facilitated retirement savings programs” since 2012.

The report found that as of this year, at least 22 states have introduced legislation to launch new problems, change existing ones or explore their other options. Among the states that have introduced programs, 17 opted for auto-IRA programs.

Scott Broaddus, an Irongate Capital Advisors partner, said auto-IRAs differ from SCRS’ multiple-employer plan (MEP) in a number of ways. He said the primary difference is that with auto-IRAs, a company cannot match an employee’s contribution, likely leading to limitations on how much a person can save.

“The balances will grow faster in a 401(k) plan if they’re receiving a company match versus not receiving any match,” Broaddus told Repairer Driven News. “It’ll look more attractive to a potential employee.”

The SCRS plan includes a number of benefits, such as:

    • Allowing each business to customize its own plan features;
    • Administrative support to help with transition, onboarding, and employee education;
    • An executive committee within SCRS that conducts quarterly reviews of plans and investments; and
    • A pre-negotiated declining fee schedule, meaning as the plan grows costs automatically go down.

SCRS also prepares the annual tax filing, and one audit is conducted for the entire plan, which Broaddus said saves companies time and money versus an auto-IRA.

“As additional companies sign on, all the existing participants still receive the same reduced pricing,” he said. “People that signed up in 2019 have already seen their plan costs reduced multiple times, as more companies have signed on.”

It’s no secret that shop owners are nearly always busy, and Broaddus said the SCRS retirement plan can also help save them time while ensuring they’re complying with regulations.

“The SCRS plan has an investment committee and a group of participants that help the individual shop owners make sure that they are complying with all the Department of Labor regulations to keep the plan working in good order,” he said. “Most business owners wear 30 different hats in a week and they don’t know all the rules about what they need to do, when they need to distribute notices, or when they need to file away items to have in their fiduciary folder. We operate as a fiduciary on the plan for the business owners alongside them and it provides a lot of relief for owners to focus on where they [need to] spend their time.”

Separately, the Lincoln Financial Group shared research in April indicating 65% of small business owners are concerned about having enough income during their retirement. Among those who don’t own businesses, 48% said they were worried about retirement savings.

“Small business ownership comes with a great deal of responsibility — not only for the business and its employees but also for the owner and their family,” said David Berkowitz, president of Lincoln Financial Network, a division of Lincoln Financial Group. “Our research shows that many people who own their own business may not be prepared with the right financial products and solutions to help them feel confident about their financial future.”

Broaddus said retirement savings concerns could be related to the fact that few companies offer pension plans to their employees. He said plans such as the one offered by SCRS are a way for workers to be more comfortable heading into retirement.

“If you do not have savings, you have no real way of ever stopping work unless you can live off of Social Security,” he said. “The average Social Security check in the United States is right around $1,100 per month, and most people’s living expenses are higher than that.

“This [SCRS retirement plan] is really the key mechanism that allows people to not [have to] work at some point down the road.”

For more information about SCRS, or to join as a member, visit, call 1-877-841-0660, or email


Featured image credit: CatLane/iStock

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