More Employers Raise Retirement Contributions After Tax Reform
Encouraged by the new tax reform law, more well-known employers have announced plans to boost retirement plan contributions for their workers.
The most recent is Anthem Inc., which says it will make a one-time $1,000 contribution
to the retirement saving accounts of more than 58,000 employees and recent retirees. For those who are eligible but don’t participate in the plan, Anthem says it will automatically create an account for them and make the one-time contribution to those accounts.
Mastercard Inc. has also announced plans to bump up retirement contributions, increasing its employer match to 10%, up from 6%. Visa had previously announced it would match 200% of contributions up to 5% of base pay, up from a 200% match of up to 3% of base pay at present. They’re also planning to step up their current default contribution rate from 3% to 5% “to encourage use of the program.”
Hostess Brands Inc., has said it will provide workers one-time payments of $1,250 – with $750 in cash and $500 in the form of a 401(k) contribution. (The firm, which makes Twinkies, Ding Dongs and Ho Hos, has also said it will offer a year’s worth of free food to workers.)
The tax reform law is fueling changes to corporate America’s employee benefits programs – with expanding personal financial planning and boosting 401(k) contributions topping the list, according to a new employer survey by Willis Towers Watson. Two-thirds of those (66%) surveyed are planning or considering making changes to their benefit programs or have already taken action, the survey found. In fact, a number of employers have already announced those changes, including Honeywell, Nationwide, Aflac, Starbucks and SunTrust Bank.
Grover Norquist’s “Americans for Tax Reform” has and is compiling a list of what it calls “Tax Reform Good News” — a list of firms who have announced bonus/raise/401(k) increases in the wake of the tax reform legislation. The list is at https://www.atr.org/list