APR. 06, 2020
Passage of CARES Act will help many navigate uncertainty
Recently, leaders in Washington reached an agreement on the largest economic stimulus package in American history. I applaud the bipartisan effort that led to the Coronavirus Aid, Relief and Economic Security Act (CARES Act), which is sure to provide some much-needed help to millions of people impacted by the economic fallout of the Coronavirus pandemic.
Today, Americans are suffering financially, psychologically and, in some cases, watching friends and loved ones face potentially dire health issues. This legislative achievement provides a ray of hope to a nation in need of some good news.
The Act provides a wide variety of potential relief options for those impacted by the coronavirus pandemic, including some with implications for retirement planning. Notably, it includes two provisions that enhance access to retirement savings as a potential source of relief, including tax-favored retirement plan withdrawals up to $100,000 until Dec. 31, 2020; and expanded access to loans from retirement accounts for 180 days after enactment.
Our unprecedented, extraordinary times call for immediate action
As a mutual company focused on protecting people, businesses and futures with extraordinary care, Nationwide recognizes people are facing a myriad of challenges right now, and we’re here to support what they feel is the best decision for their family. Part of this support includes providing education and historical perspective that may inform potentially emotional decisions that could lead to adverse long-term outcomes.
The retirement savings provisions of the Act provide current and future retirees increased flexibility and new options, but individuals should understand how this may impact their plans for a secure retirement. Before tapping their retirement nest egg, it’s important that they consider leveraging other new sources of relief provided by the CARES Act. This includes:
- Emergency stimulus checks
- Student loan modifications
- Rent/Mortgage/Debt moratorium
- Enhanced unemployment benefits
- Delayed tax payments
- Emergency paid leave
- Emergency sick leave
History tells us the markets will return, and savers who take themselves out of the market now may not benefit from future gains. In fact, participants would lock in losses if they were to take distributions out of their retirement savings today.
Our commitment to our members remains strong
Nationwide recognizes these are difficult times and is committed to helping those impacted make the right decisions. Over the past few weeks, market volatility has more than doubled the number of calls we’ve taken from retirement plan participants. We are proud to maintain flexible hours (8am-11pm ET) and weekend availability, manage reasonable wait times, and have implemented call-back technology that’s providing an even better experience for plan participants.
More than our technology and the logistics of taking calls, our people are here to help educate and provide options – because at a time like this, retirement savers want to talk to someone who cares. Many of our calls have been therapeutic in nature as our team helps participants avoid making emotional decisions in this emotional time.
Nationwide has served millions of people saving for retirement, helping them protect their legacies through economic adversity of all types for close to five decades. We’ve helped our members weather financial storms in 2008 and many other times in the past. Our approach is consistent when addressing participants facing hardship – we’re here to help educate them so they can make informed, decisions.
By working together we’ll emerge stronger than ever
Financial advisors play an important role at this time as well. Advisors can provide a level of personalized advice because they understand their clients’ situation and can help them weigh both the short and long-term implications of any decision they may be evaluating. If they are considering tapping their retirement savings, it’s vital that they have all the information they need before making that decision.
Together we can make a difference for the millions of Americans who depend on our industry for a secure retirement. Thanks for all you’re doing to help at this critical time.