Most Small Employers Face Low Costs to Implement Automatic IRAs

One of the concerns about an Automatic IRA program for all employees who do not have access to an employer-provided retirement plan is the potential costs to employers. This report finds that most employers would likely face low costs to implement a system of automatic individual retirement accounts (IRAs).  Automatic IRAs can be designed to integrate into existing business payroll systems in a way that will minimize an employer's responsibilities. Most small employers will have only small incremental costs to modify their payroll processing systems in order to facilitate enrollment in Automatic IRAs and withholding of Automatic IRA contributions. The widespread adoption of automated payroll systems, including within the small business sector, and the ability of those system providers to build the Automatic IRA into their services, will make this new employee benefit relatively simple to implement. … Back to Article