URJ congregations can now offer the RPB retirementplan to more employees.
RPB’s new policy enables URJ congregations to offer the RPB plan to more employees. Here are the new, expanded eligibility requirements:
The employee must be at least 18 years of age.
Work at least 18 hours per week at a URJ congregation. This means your employees in administrative, finance, custodial, security, or other positions can now participate in RPB’s retirement plan.
And also, be a member of one of the following Reform Movement professional organizations (CCAR, NATA, ARJE, ECE-RJ, PEP-RJ, ATID), only if the organization requires membership based on their job. Visit rpb.org/eligibility for positions that must be professional organization members.
Additional notes on eligibility:
Employees enrolled in RPB’s plan due to previous employment don’t have to satisfy the hourly service requirements to continue their contributions.
Employees participating (or eligible to participate) in the American Conference of Cantors retirement plan won’t be eligible for the RPB Plan.
There is no cost for congregations to offer the RPB Plan.
RPB offers a range of funds, including custom target allocation funds (for those who don’t want to or are not confident in their ability to manage their investments themselves), a lineup of index funds, as well as a custom socially responsible fund called the Reform Jewish Values Stock Fund.
Each fund has an investment management fee. In addition, there is an annual administrative fee charged to all participants. Our Investment Committee works to ensure that our fees are the most cost-effective for the type of fund and, because of the amount of assets RPB has under management, these fees are lower than what an employer might be able to find on their own.
Visit rpb.org/invest for more information.
All employees can save for their retirement by making contributions to the Plan from their paycheck—up to the IRS annual contribution limit. The RPB Plan accepts both pre-tax and post-tax Roth contributions from participants.
Employers set their own contribution policy. You choose whether all or some employees receive employer contributions, if the contribution percentage will be the same or different, and if a waiting period is required. Employer contributions are only made on a pre-tax basis.
There are no minimum contribution requirements for employees or employers.
All employer contributions will be 100% vested. RPB’s plan does not include vesting.
Employer contributions are at your discretion. There are many factors you will likely need to consider when thinking through whether or not to make employer contributions on behalf of your newly eligible employees.
The current job market is extremely competitive. In addition to offering a quality retirement plan, matching or otherwise making employer contributions to employee’s accounts may help your organization attract and retain top-quality talent.
Contact us to talk through industry best practices about matching contributions and more.
The synagogue is legally responsible only for choosing to participate and remain in the RPB plan—responsibility that it already has for its rabbis and professionals. The RPB bears all other fiduciary responsibilities with regard to the plan and its participants.
Membership in one of the professional organizations is determined by the employee’s position. Go to rpb.org/eligibility for details.
RPB will also review the employee’s profile during enrollment and let you know if an employee needs to join a professional organization.
For employers who offer another retirement plan (in addition to RPB):
- If you haven't already, submit information about your congregation-sponsored plan.
- We will contact you as soon as we get your information.
Switching from your existing plan to the RPB Plan may take some time. But, you can begin enrolling your employees in RPB as soon as you're ready—they do not have to wait your other plan to wind down or for their assets to transfer over. There is one exception. If your current plan is a SIMPLE IRA, there is a specific timeframe for when you can enroll employees in a new plan. Our CFO, Alyce Gunn, will guide you through the process.
RPB offers a non-qualified deferred compensation plan called the Rabbi Trust plan. Any employee (not just rabbis) whose employer contributions exceed the IRS limit can put their excess savings in a Rabbi Trust account.
RPB periodically commissions retirement readiness studies. These studies have shown that an employee should save about 18% of their compensation every year for retirement. This can come from employee contributions, employer contributions, or a combination of both. Although not all plan participants can achieve that rate of savings, that should be everyone’s goal.
There are two retirement readiness best practices that many organizations use: (1) auto-enrollment in an organization's retirement plan and (2) auto-escalation of employee contributions.
Because of the low retirement savings rates in the United States, best practices in and proposed legislation governing the retirement industry recommend employers automatically enroll their staff, especially new hires, in an employer-sponsored retirement plan, such as the RPB plan. Your organization sets a minimum employee contribution rate upon enrollment and the employee can opt out of the plan if they do not want to participate. Studies have shown that auto-enrollment leads to higher participation rates and higher retirement savings rates than waiting for an employee to opt into participation.
Auto-Escalation of Employee Contribution Rates
Another best practice in the retirement industry calls for employers to automatically increase their employees’ contribution rates every year, with an option for the employee to decline the increase if they can't afford it. The automatic savings increases are usually timed to occur when the employee receives their salary increase to minimize the impact. Typically, an auto-escalation policy might have a 1 percentage point increase every year until the employee reaches the IRS maximum contribution amount.