With a few exceptions, SECURE 2.0 requires that 401(k) and 403(b) plans established on or after December 29, 2022 begin to automatically enroll participants upon becoming eligible for such plan by the first plan year beginning after December 31, 2024 (“Effective Date”). For a plan with a calendar year plan year, this means that automatic enrollment must be effective by January 1, 2025.
I’m all for automatic enrollment, and getting more retirement plan coverage for employees. The problem is that I believe many plan sponsors and plan providers aren’t ready and we are less than 6 months ahead of the deadline. As with any change, some providers will do better than others. There are going to be many hiccups along the way, guaranteed, on the plan sponsor and plan provider sides.
