Bush Retirement Plan Proposals Create Confusion for Employers Employee Benefit News (03/03) Vol. 17, No. 3 p.1; Blassingame, Kelley M.
Retirement savings experts and plan sponsors are still trying to absorb President Bush's 2004 budget proposal, which among other things calls for a major overhaul of retirement savings options. Ed Ferrigno, vice president of the Profit Sharing/401(k) Council of America, says the proposal is drastic, and will "take some time to sort through." Under the president's plan, 401(k), 403(b) and 457 plans would be replaced with Employer Retirement Savings Accounts (ERSAs) and various other options. Rod Crane, a vice president at benefits consulting firm The Segal Co., says ERSAs are more or less simplified versions of the 401(k); he also says that many public safety officers are enrolled in 457 plans, and warns that lawmakers could have a fight on their hands if this group, which happens to be backed by a powerful lobby, determines they are being short-changed by the president's proposal. The Bush plan also proposes eliminating traditional IRAs and supplanting them with Retirement Savings Accounts or RSAs. For employers, the task will not only be to make their plans appear more attractive to their workers, but to also provide financial planning advice so their workers can make informed decisions, experts say.