New Participant Disclosure Requirement
The SECURE ACT and "lifetime income illustrations"

Participant’s in 401(k) and Profit Sharing plans will be seeing some new figures on their benefit statements starting soon. The SECURE Act now requires statements to include “lifetime income illustrations”. These illustrations will show the participant what their account would provide in the form of a monthly income payable for life assuming the participant was 67 years old (or actual age if older) and retired now. They will also show the monthly income if it was payable until the later of the death of the participant or the participant’s spouse.
The illustrations are based on a specific set of assumptions regarding interest and mortality. Participants are assumed to be married to someone their own age. It should be noted that the numbers illustrated are hypothetical and do not represent what the participant could actually receive. It’s possible the retirement plan might not even offer monthly installments. The Department of Labor feels this information will still help the participant gauge where they are in their pursuit of financial security in retirement.
If you have questions about the new disclosures feel free to contact us.
Larry Shippee
President



