Celebrating Policy in Action: The Student Loan Retirement Forum

Last week, Summer had the privilege of attending the first-ever Student Loan Retirement Forum co-hosted by the Plan Sponsor Council of America, the American Retirement Association, and the SPARK Institute, at Georgetown’s Center for Retirement Initiatives in Washington, D.C.

In the room were policymakers from the IRS and Treasury Department, research organizations like the Employee Benefit Research Institute (EBRI), and representatives from the 25 largest retirement recordkeepers, managing a combined $30 trillion in assets. Companies like Fidelity, Vanguard, Empower, and TIAA were all present. The reason? To discuss how to thoughtfully implement student loan retirement matching provisions introduced by the SECURE 2.0 law, which went into effect on January 1, 2024.

The Student Loan Retirement Forum was a celebration of policy in action. It’s one thing to pass a law, but another to bring all relevant stakeholders together to ensure these policies are implemented thoughtfully and equitably for millions of Americans. The forum was an opportunity for policymakers, industry leaders, and experts to collaborate on how to make student loan retirement matching accessible, understandable, and beneficial for consumers. 

Here are five important takeaways from the event:

1. Student Debt is a Barrier to Retirement Savings: The Employee Benefit Research Institute (EBRI) shared research showing how student debt reduces retirement contributions for millions of hard-working Americans. Those burdened by student loans tend to contribute less to their retirement plans, creating a compounding effect that widens the retirement savings gap over time. This data underscores the urgency of the solutions discussed at the forum.
   
2. Retirement Recordkeepers are Prioritizing Student Loan Retirement Matching: There was a clear trend among top retirement companies that they are leaning into supporting their employer clients with student loan retirement matching. Plan sponsors (the industry term for employers that offer retirement plans) want certainty before they invest in new tools, but the momentum is building, and many are preparing to implement these solutions in the near future.
   
3. Collaboration is an Impactful Way to Bring This Solution to Market: Brian Stellingwerf from ADP highlighted ADP Retirement’s integration with Summer, noting the powerful impact of student loan retirement matching for their employer clients and plan participants. Together, ADP and Summer are bringing this exciting solution to market, ensuring that more employers can help their workers pay off student debt while saving for retirement—a win for employers and employees alike.
   
4. IRS Seeking Industry Feedback: One of the most significant themes was the IRS's call for feedback during their open comment period on how rulemaking around student loan retirement matching will impact both the retirement industry and its customers. They emphasized the importance of hearing from recordkeepers, plan sponsors, and other stakeholders to ensure their guidance is practical and comprehensive.
   
5. Preference for Third-Party Verification Services: Because the IRS’s guidance on self-certification is unclear, there is hesitancy among plan sponsors due to concerns about potential fraud or administrative complexity. As a result, most recordkeepers are looking to offer third-party verification services to avoid the challenges and pitfalls of self-certification.

As we continue the journey of leveraging SECURE 2.0 to help employees better save for retirement, forums like this one are crucial for turning policy into effective market innovations. 

Initiatives like these help by bringing the retirement industry together to learn from one another, sharing best practices and learnings, and ensuring that student loan retirement matching becomes a tool that millions of Americans can use to achieve both financial freedom and long-term security.

Want to learn more about how Summer is enabling recordkeepers and plan sponsors to boost their retirement savings through student debt alleviation and retirement matching? Reach out to us at partner@meetsummer.com to learn more.