RETIREMENT CLEARING HOUSE: Company Profile & Review

RETIREMENT CLEARING HOUSE
RETIREMENT CLEARING HOUSE

Retirement Clearing House provides retirement plan sponsors with services that push retirement savings forward as participants change jobs, providing true transfer from plan to plan.

For plan sponsors, RCH services solve a small account problem by reducing plan costs and reducing fiduciary liability.  For RCH decision makers, they improve their financial well-being by maintaining retirement savings, increasing average balances and promoting retirement readiness.

About Retirement Clearing House Company

Founded in 2001 as RolloverSystems, the Retirement Clearinghouse in Charlotte, New York, works with more than 31,000 retirement plans and has helped 1.6 million plan members receive more than $ 25 billion in retirement savings. 

Retirement Clearinghouse is a portfolio company of The RLJ Companies, founded by Robert L. Johnson.  To learn more, visit www.rch1.com.

What Does Retirement Clearing House Do?

Retirement Clearinghouse, LLC is a leading provider of transfer and consolidation services for defined contribution plans, acting as a reliable, impartial intermediary between plan sponsors, participants, registrars and others. 

Retirement Clearinghouse’s integrated financial technologies, data and information solutions make it easy to automatically consolidate small extra accounts for sponsors to improve plan performance and allow participants, regardless of account balance, to seamlessly transfer their retirement savings at every stage of their careers.

Retirement Clearing House Review

Retirement Clearinghouse portable solutions have been shown to reduce cash withdrawals by more than 50% and significantly increase the average account balance. 

The firm’s portability solutions include an internal call center that provides specialized assistance designed to ensure full portability and account consolidation; cashless check services; and the ability to search for lost and missing participants.

Retirement Clearing House Company Profile

Retirement Clearinghouse has just under 70 employees.  The new headquarters can hold about 350. Nearly half of the staff work at the service center to lead the consolidation process for plan members, Ringquist said.  He added that this is where the majority will be hired.  The projected average salary is just under $66,000 a year.

Retirement Clearinghouse is working on a hybrid model and plans to return everyone by the end of the year.  Retirement Clearinghouse has made its biggest technology investment in several years as it has developed automotive portability and environmental infrastructure.

 Alight helped launch the auto-transfer program by offering the service to its 185 plan sponsors, who manage nearly 5 million customers.  In 2017, Retirement Clearinghouse made the first fully automated transfer to an active account.

Retirement Clearing House IRA

When a participant leaves a job with less than $ 5,000 in their 401 (k), employers can transfer these accounts from the plan to an individual retirement account (IRA), where the commission may be higher.  This could lead to the proliferation of IRAs stuck in a safe haven, paying participants cash and losing future savings and profits.

To reduce payouts or savings, RCH Auto Portability automates the transfer of a 401 (k) employee’s savings account from a former employer’s plan to an active account along with the current employer’s plan.  The service can also help simplify the administration of the plan and improve compliance with it by reducing the number of accounts left and unlisted checks.

Retirement Clearing House Cash Out

According to the simulation model created by the Retirement Clearinghouse, about 5.3 million 401 (k) participants with less than $ 5,000 in their accounts leave their jobs each year.  Of these, 4 million withdraw cash from their accounts, withdrawing about $ 6.6 billion a year from retirement plans.

Sponsors of the plan are allowed by law to withdraw small accounts with balances of less than $ 5,000 when employees leave, offering them the option to either withdraw their balances or transfer funds to an individual retirement account or a new employer plan.  Neither the withdrawal option nor the IRA option is ideal. 

Participants who transfer their balances are taxed on their distribution tax and are fined 10% of the early withdrawal if they are under 59 years of age.  Those who transfer their funds to the IRA often pay much higher fees than they had in their 401 (k) plan.  And if the participant does not make a choice, the plan sponsor can transfer this money to the IRA for the participant or send a check to the participant.

HCA Retirement Clearing House

As part of HC’s employment benefits, HCA is pleased to offer additional support in the management and supervision of pensioners’ pension accounts.  To help with this, HCA is already working with the Retirement Clearinghouse to ensure that retirees are well aware of their capabilities.  They can take advantage of the additional support that RetireLink offers.

RetireLink is a comprehensive education and retirement savings program.  Retirement Clearinghouse specializes in helping HCA affiliates make informed decisions about their retirement savings.  Retirees can call the Retirement Clearinghouse at 1-866-340-3252 to credit the HCA 401 (K) plan and open IRA information on various retirement options.

Retirement Clearing House FAQs

Are My Retirement Savings Safe With Retirement Clearinghouse?

Yes, RCH, through its subsidiary RCH Shareholder Services LLC, is a registered transfer agent, supervised by the Securities and Exchange Commission (SEC) and authorized to administer the IRA in a safe harbor.

What Is Auto Portability?

Automatic portability is the usual, standardized and automated transfer of an inactive member’s pension account from the former employer’s pension plan to his active account in the new employer’s plan.  Automatic transferability changes the dynamics for these participants, making the simplest decision (saving pension savings by automatically moving them forward within the defined contribution system) as the best solution.

Can I Transfer My RCH Balance To Another Retirement Savings Account?

Yes, RCH specializes in helping people move their retirement savings forward.  If you have a secure IRA account at RCH and want to combine your savings into another 401 (k) account or existing IRA, just call us at the RCH Service Center, which is open Monday through Friday from 8:00 a.m. to 8:00 p.m. 19:00 EST, at 1-888-600-7655.

CONCLUSSION

Retirement Clearinghouse remains the only independent provider that defines its core business as consolidating retirement savings in active 401 (k) or IRA accounts and provides plans and participants with services that facilitate the transfer of savings between retirement accounts.

In July 2019, Retirement Clearinghouse gained an advantage over its competitors when it received an exemption from prohibited transactions from the Ministry of Labor, which allowed it to automatically transfer funds on the basis of so-called negative consent, which means it could transfer funds without explicit consent for transfer.  As a rule, participants must claim that their account balances have been transferred to another employer’s plan.

REFERENCES

planadviser.com – Vanguard Partners With Retirement Clearinghouse for Auto-Portability Solution

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