Tax incentives and state mandates driving surge in new 401(k) plans: Cerulli projecting a gain of 230,000 plans by 2028, raising hopes of closing 'coverage gap'.

A surge in new 401(k) plans is expected due to tax incentives and state mandates. Cerulli Associates projects that there will be over 900,000 401(k) plans by 2028, an increase of 230,000 from 2022. Record keepers for retirement plans, such as Guideline and Human Interest, have seen significant growth in new plan creation. The increase in plans is seen as a positive development for an industry that has struggled to close the "coverage gap" for private sector workers without access to retirement savings plans. Factors driving the growth include tax incentives, state-run retirement savings programs, a competitive labor market, and the expectations of younger workers. However, the tax incentives are complex, and many employers are not aware of the benefits they provide. Some experts suggest making the tax credits available at the point of sale to simplify the process. [Extracted from the article]