Aug 13, 2019 - 10:00am

Quick Take: Your Primer on Small Business Retirement Plans


Executive Director, Retirement Policy

Vice President, Small Business Policy

Fill Me In:

Many small business owners believe that 401(k) plans are too expensive and too much of a hassle to administer and maintain. Multiple Employer Plans (MEPs) are an increasingly popular option because the administrative functions of setting up and running a retirement plan is outsourced to a group or association of employers.

Why Does It Matter?

Studies show that employees under save for retirement. Expanding participant eligibility for MEPs should increase competition, lower costs, and provide more choices for Main Street employers to increase their employee benefits – helping millions of small business employees better secure a healthy retirement and future.

Numbers to Know:

  • 60 million. More than half of the workers in the United States (approximately 60 million) do not have access to an employer-provided retirement plan.
  • 13%. About 13% of small businesses provide retirement savings plans.
  • 14 years. The average length of retirement is 21 years, but the typical citizen’s savings are likely to last 14 years, underscoring the importance of retirement plans. 

Our Take:

The U.S. Chamber of Commerce applauds the Department of Labor’s ruling in July 2019 that allows groups or associations of employers, such as state or local chambers of commerce, to establish Association Retirement Plans (ARPs), otherwise known as MEPs. This ruling expands MEP participants from needing to have some form of commonality among the firms (i.e. being in the same industry) to now belonging to the same association.

However, several states mandate that businesses offer retirement plans. The U.S. Chamber has opposed mandatory Individual Retirement Accounts (IRA) and continues to caution against mandating retirement plans that limit choice, politicize investment choices, and increase cost and liability for small businesses.

The U.S. Chamber supports the bipartisan work that has gone into the MEP provisions in the Setting Every Community Up for Retirement Enhancement (SECURE) Act of 2019.

What’s Next:

We applaud the House passage of the legislation and we are working with the U.S. Senate to make these plans a reality. The U.S. Chamber is dedicated to making it easier for employers to offer retirement plans to their employees to secure a healthy retirement for all workers.

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About the Authors

About the Author

Executive Director, Retirement Policy

About the Author

Photo of Tom Sullivan
Vice President, Small Business Policy

Thomas M. Sullivan is vice president of small business policy at the U.S. Chamber of Commerce. Working with chambers of commerce and the U.S.