Compliance January 6, 2025

Biden Signs Social Security Fairness Act

The law will boost Social Security benefits for nearly 3 million public workers.

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President Joe Biden

President Joe Biden signed into law on Sunday the Social Security Fairness Act, which will boost Social Security benefits for almost 3 million public workers.

The bipartisan legislation, just passed by Congress in December, repealed two provisions that reduced Social Security benefits for certain public workers who also receive pensions, including teachers, police officers and firefighters.

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“The law that existed denied million of Americans access to the full Social Security benefits they earned by thousands of dollars a year,” Biden said during a televised event at the White House. “That denial of benefits also applied to surviving spouses of public service employees.”

The law repeals the Windfall Elimination Provision and Government Pension Offset provision of Social Security, which reduced Social Security benefits for more than four decades for public workers who receive pensions from state and federal jobs.

The reduced benefits were “particularly salient given county workforce shortages, potentially deterring talent from serving in the public sector,” according to a post by the National Association of Counties, which advocates for county governments. Restoring full benefits will result in some retired public servants seeing an increase of up to $587 in monthly benefits, according to the International Association of Fire Fighters.

“After 40 years of being treated like second-class citizens, a wrong has finally been righted, and millions of retirees can afford to retire with dignity—and with the Social Security benefits they earned and paid into,” IAFF General President Edward Kelly said in a statement. “Repealing the WEP/GPO has been one of my top priorities as General President.”

The U.S. Senate voted 76 to 20 to pass the act, H.R. 82, on December 21, 2024. The U.S. House of Representatives had passed H.R. 82 on November 12, 2024, by a vote of 327 to 75.

According to the Congressional Research Service, there were about 745,679 people—about 1% of Social Security beneficiaries—who had their benefits reduced by the Government Pension Offset. Meanwhile, about 2.1 million people—about 3% of beneficiaries—were affected by the Windfall Elimination Provision, according to the IAFF. About 71.6 million people receive Social Security, according to the Office of Retirement and Disability Policy.

The bill will result in increased payments to affected workers from the Social Security Administration, the future management of which will likely be discussed after President-elect Donald Trump takes office later this month. The benefit’s Old-Age and Survivors Insurance Trust Fund and Disability Insurance Trust Fund are projected to become insolvent in 2035, resulting in a reduction of benefits, unless legislators take action.

In Practice January 3, 2025

Nuts & Bolts: Requests for Proposal

What new plan advisers need to know about RFPs from plan sponsors.

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Securing a retirement plan advisory role often begins with an adviser completing a successful response to a request for proposal from a plan sponsor. While the RFP process can be demanding, it also presents an invaluable opportunity for advisers to showcase their expertise, client-centric approach and value proposition.

PLANADVISER turned to industry expert Mark Olsen, managing director of PlanPilot, to answer common questions from plan sponsors about RFPs. Olsen has more than two decades of experience in providing institutional retirement plan consulting to 401(k), 403(b) and defined benefit plans.

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What are RFPs from plan sponsors?

Requests for proposal are a cornerstone of the decisionmaking process for retirement plan sponsors looking to evaluate potential service providers. Olsen describes RFPs as “a written instrument designed to help plan sponsors determine who might be a good fit to provide services to their retirement plan.”

RFP responses allow sponsors to assess various advisers based on their qualifications, expertise and alignment with the plan’s specific needs. Olsen emphasizes that well-structured RFP responses are vital for achieving successful partnerships.

What does a retirement plan adviser need to know about RFPs?

For advisers seeking to win business through RFPs, authenticity and clarity are crucial. Olsen recommends that advisers “lead with your strengths and be succinct in your responses.” He highlights the importance of differentiating by focusing on unique capabilities.

“For us, it’s about talking about our investment acumen that’s coupled with strong client service,” he says. “Putting clients first has been a big part of how we’ve been successful in earning trust during the RFP process.”

Providing real-world examples can also help advisers make a stronger impression. Olsen says using case studies or examples of how advisers have supported similar clients tells their story in a relatable, impactful way. Advisers should craft responses that clearly outline their approach to client relationships and their expertise in working with similar-sized plans.

How do RFPs relate to clients and business?

RFPs play a dual role in the industry: Soliciting proposals allows plan sponsors to evaluate potential partners, while the chance to respond to RFPs is a growth tool for advisers.

“It’s an optimal way to grow our client base,” Olsen says.

By responding thoughtfully and thoroughly, advisers can demonstrate their ability to meet the sponsor’s needs and improve retirement outcomes for participants. Olsen encourages advisers to provide concrete examples of success, such as how they have enhanced participant outcomes or helped clients achieve a more secure retirement.

Plan sponsors also benefit from RFPs by gaining insights into how advisers can align with their goals. Olson points out that RFPs often focus on key criteria, such as client service models and experience with similar-sized plans, ensuring sponsors find the right fit for their organization.

What are common misperceptions or mistakes made when dealing with RFPs?

Mistakes in the RFP process can happen on both sides. Olsen identifies two primary areas of concern: the creation of the RFP itself and the adviser’s response. For plan sponsors, he stresses the importance of tailoring the RFP to their specific needs.

“If you’re a smaller plan sponsor, you need to focus on aspects like client service and the number of clients similar to your size,” he states. “Otherwise, you might end up with a provider that prioritizes larger clients, which could impact the level of service you receive.”

On the adviser side, Olson underscores the need for clarity and transparency.

“Be very direct about what your service model is, what it isn’t, and how you approach working with clients,” he advises.

What does the future look like for RFPs?

Technology is reshaping the RFP landscape, and Olsen expects that change to accelerate. Tools that streamline information-gathering and response evaluation are becoming more common, allowing sponsors to make more informed decisions efficiently.

Looking ahead, Olsen predicts that artificial intelligence will play a larger role in the RFP process, as AI can provide insights into what sponsors are looking for and help analyze responses more efficiently. He says while AI may not be a perfect solution, it offers significant potential to pinpoint key differentiators and streamline the evaluation process.

As the RFP process evolves, advisers must stay adaptable and leverage both technology and personalized responses to remain competitive.

Olson’s advice is to “focus on authenticity, lead with your strengths and provide clear, concise and relatable responses that align with the sponsor’s needs.”

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