Recent confirmation hearings for the potential head of the Employee Benefits Security Administration highlighted likely future issues for retirement plans. The nominee emphasized that retirement plans and fiduciaries should operate within established fiduciary guidelines. Key regulatory priorities mentioned include: deregulating the enforcement of employee stock ownership plans, modernizing 401k investment options, enhancing cybersecurity, addressing plan forfeitures and missing participants, and expanding access to retirement and health plans.
In recent years, there has been a rise in class-action lawsuits questioning the appropriate use of plan forfeitures in 401k and similar defined-contribution plans. Forfeitures occur when employees leave before fully vesting in employer contributions, and many plans use these funds to offset future employer contributions. However, the lawsuits argue that this practice may violate ERISA. While the outcomes of these cases remain uncertain, plan sponsors and fiduciaries are advised to monitor the situation, review their plan documents, and consider amendments to mitigate potential risks.
The SECURE Act 2.0 introduces a significant change to the tax treatment of catch-up contributions for older retirement plan participants, effective January 1, 2026. Individuals with prior year FICA wages over $145,000 will be required to make catch-up contributions as Roth contributions, meaning they will be taxed upfront rather than at withdrawal. This change alters the previously straightforward rules regarding catch-up contributions. The article outlines the differences in catch-up provisions before and after the SECURE Act 2.0, explains when catch-up contributions occur within plan operations versus participant elections, and offers guidance on adapting to these new rules.
On June 25, the SEC's Office of the Investor Advocate announced that it will prioritize "Private Market Investments in Retirement Accounts" as a key objective for 2026. This focus is part of a broader agenda that also includes enhancing disclosure accessibility, conducting disclosure and investor testing, assessing the impacts of SRO rule proposals on investors, addressing issues related to China-based variable interest entities, and responding to requests for information from a crypto task force.
Your health and your 401k plan require attention and care to function well. Just as physical symptoms like chest pain or fatigue indicate health issues, problems within a retirement plan can signal deeper concerns. With over 25 years of experience, the author has identified various symptoms of poorly managed plans, some subtle and others more obvious. Plan sponsors need to recognize these warning signs early. If you notice a few issues, a checkup may suffice, but multiple problems could indicate the need for significant intervention.
Bed Bath & Beyond's 401k committee has received preliminary court approval for a $1.95 million settlement regarding a class action lawsuit filed under ERISA. The lawsuit was brought by plan participants who accused the company of mismanaging its retirement plan, which affected around 2,100 employees before the plan was terminated due to bankruptcy. The proposed settlement was reached in December, and details were disclosed in February. A fairness hearing for the settlement is set to take place in October.
The 2025 Retirement Confidence Survey aims to assess the attitudes of American workers and retirees toward retirement issues, with a specific focus on Black Americans through an oversample for deeper analysis. The analysis reveals that Black Americans tend to have lower incomes and fewer assets compared to non-Black Americans, indicating significant disparities that impact retirement confidence and other survey metrics. The article emphasizes the importance of examining the responses of Black Americans while controlling for income to better understand these challenges. It also reviews key findings of the study.
Investment fees might seem small, but they can quietly shape your long-term outcomes in big ways. This webinar reviews and breaks down the different types of fees, how they impact your retirement, and what you can do to make smarter, more cost-effective investment decisions. It looks at the processes involved in fee reviews and the many misconceptions.
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Collected Wisdom™
Our researchers look for what they think are some of the better resources available to assist you in administering your plan or helping your clients. We group these resources in our COLLECTED WISDOM™ topics to make it easy for you to locate the information you need. Each item in a category contains a summary and date of when it was placed in the group.
We also maintain some older material in these collections for perspective and context.
