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Daily Article Digest - Updated Throughout the Day

This digest contains a wide variety of the freshest source material dealing with current trends, opinion, news, legislative action, investments, marketing, sales, consulting, and legal issues regarding 401k, 403b and other retirement plans. Each listing contains a headline (hyperlinked to the source document), description, source of the item, and the month and year posted to this digest.

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How to Gauge Retirement Plan Effectiveness

Abstract: It's not easy to get a good sense of whether the 401k or 403b plan your institution offers stacks up favorably with employee expectations. However, it's essential for sponsors to have a good idea of what makes their plan attractive (or not), how to measure it and the overall impact on employee satisfaction. Here's how to start tracking your retirement plan and its effect on the bottom line.

Source: Planpilot.com, June 2018

Fidelity Backs Away From Being 'Point in Time' Fiduciary for 401k Plans

Abstract: Fidelity Investments will no longer serve as a fiduciary when it helps employers select investments for their 401k plans, moving away from a policy the firm adopted last year in response to the Department of Labor's fiduciary rule.

Source: Investmentnews.com (registration may be required), June 2018

Here's Why DC's Latest Plan to Fix Retirement Crisis Is Probably Already Doomed

Abstract: Lawmakers in both chambers are trying to build momentum for a variety of legislative fixes that would make it easier for workers to save in tax-preferred retirement accounts, and perhaps build up their short-term savings, which are also depressingly meager. Despite creating an alphabet soup of tax preferences for retirement savings, a crisis yet exists.

Source: Bankrate.com, July 2018

IRS Issues Final Regulations Approving Forfeitures to Fund QNECs, QMACs

Abstract: The IRS and Department of the Treasury have issued final regulations amending the definitions of qualified nonelective contribution and qualified matching contribution, settling the issue of whether participant forfeitures can be used to fund QNECs and QMACs.

Source: Ascensus.com, July 2018

Brown University Wins Dismissal of Many Claims in 403b Plans Challenge

Abstract: While many claims in a lawsuit challenging administration and fees for Brown University's 403b plans were dismissed, a federal district court judge allowed several claims to move forward. The lawsuit alleges fiduciaries approved a TIAA loan program that required collateral as security for repayment of the loan, charged "grossly excessive" fees for administration of the loan, and violated DOL rules for participant loan programs.

Source: Planadviser.com, July 2018

Maximizing the "Still-Working" Exception to Delay RMDs From a 401k Plan

Abstract: While qualified plan participants are generally required to begin taking distributions April 1 of the year following the year the plan participant turns 70 ½, the "still-working" exception delays the RBD to April 1 of the year following the year the employee retires. The motivations behind the still-working exception are simple enough, however the reality is that the provision itself is surprisingly complex.

Source: Kitces.com, July 2018

Beware 401k Robo-Fiduciaries -- Especially the Human Ones

Abstract: There's a lot of talk about robo-advisers, many of which would be troubling to traditional 401k plan advisers if they had a viable business and distribution model. But, retirement plan advisers should be more concerned about robo-fiduciaries, especially "human robos."

Source: Investmentnews.com (registration may be required), July 2018

Inexpensive Ways to Promote Your 401k Plan to Employees

Abstract: There are some very simple and inexpensive ways to increase awareness of your retirement plan that as a bonus can be done at almost any time. Yes, boosting awareness of your retirement plan can be a big undertaking. However, on the simple/inexpensive side of things, here are two interesting ideas.

Source: Conradsiegel.com, July 2018

Key Issues for Fiduciaries When Investing for a Cause

Abstract: Many retirement plan participants and plan sponsors are no longer content with investments that simply bring them good returns. They also want their investments to do some good in the world. The key question for plan fiduciaries is whether they can pursue these types of investments while also meeting the requirement to act in the best interest of plan participants.

Source: Bna.com, July 2018

Eight Ways for Plan Sponsors to Increase Participation and Employee Deferrals

Abstract: Increasing participation is an admirable goal, and for some employers, there is a strong desire to invest in employees to retain them. Often an employer will feel morally obligated to help employees prepare for the future, and with employee populations progressing toward retirement age, it's in an employer's best interest to help them retire on time. Here are some ways we've seen plan sponsors use elements of plan design and communication to successfully increase participation and deferrals.

Source: Belr.com, July 2018

401k Savers Make Little Progress

Abstract: Despite the mounting pressures on Americans of all ages to save for retirement, our saving habits haven't changed in 10 years. The combined employer and employee contributions to 401ks consistently hover around 10 percent of workers' pay, according to "How America Saves 2018," an annual report by Vanguard, which administers thousands of employer 401ks and other defined contribution plans. Retirement account balances aren't going up either.

Source: Bc.edu, July 2018

A Top Factor That Determines Happiness in Retirement Has Nothing to do With Money

Abstract: Most people accept that the U.S. has a retirement savings crisis. The facts and figures illustrating this crunch are so profuse you can pick them off like low-hanging fruit on a tree. But there are other, less well-known, aspects to retirement beyond finances that weigh heavily on the joy you'll derive from the last third of your life.

Source: Aspireonline.com, July 2018

Uncovering Opportunity in the Small-Plan Market

Abstract: Pete Kirtland discusses why many advisors have avoided the small-plan market, what the key is to an advisor making a small- market solution successful and profitable, and some new or different solutions to support this market space.

Source: Aspireonline.com, July 2018

Company Benefits When 401k Plan Includes Financial Education

Abstract: Helping employees establish a solid financial foundation can have a positive workplace impact, and it is most logically accomplished through a financial education program that is part of a 401k plan. To get a sense of the workplace benefit, understand that half of all employees who reported being financially stressed said they spend three or more hours during the workweek dealing with personal financial issues.

Source: Alliant401k.com, July 2018

How America Saves 2018: Small Business Edition

Abstract: Small businesses account for 99.7% of all employer firms and more than half of all private-sector employees, according to the Small Business Administration. So how are small businesses preparing their employees enrolled in defined contribution plans for retirement? And how effectively are small-business employees using this benefit? Vanguard addresses questions surrounding small-business retirement behavior in this research.

Source: Vanguard.com, July 2018

In Focus at DOL: Missing and Terminated Participants

Abstract: Dealing with missing participants is a big issue for defined benefit and defined contribution retirement plans. Over the last few years, all three federal agencies that regulate retirement plans have been focusing on missing participants. Advisers have a key role to play when it comes to helping clients ensure compliance.

Source: Planadviser.com, July 2018

Peering Through the Regulatory Kaleidoscope

Abstract: Attend any retirement industry conference held in 2018 and it will almost certainly include presentations on the topic of evolving and conflicting regulation. One question that comes up repeatedly is: "What is the real source of the almost comical amount of regulatory uncertainty impacting retirement plans, and how can plan sponsors or even their skilled advisers be expected to keep up with the myriad twists and turns?" The article explores the question.

Source: Planadviser.com, July 2018

Untimely Small Plan Excessive Fee Suit Dismissed

Abstract: An excessive fee suit that had alleged "astronomical" fees in a $25 million plan has been dismissed. The suit was filed in 2016 in the U.S. District Court for the Southern District of Ohio against payday lender CheckSmart Financial LLC's 401k plan.

Source: Napa-net.org, July 2018

Legislation Boosting SIMPLE Plans for Small Businesses Introduced

Abstract: A bipartisan bill that its sponsors say will provide greater flexibility and access to small business employees and their employers seeking to utilize SIMPLE plans as an option for saving for retirement has been introduced in the U.S. Senate.

Source: Napa-net.org, July 2018

ERISA Litigation Surging -- Focus on Fees

Abstract: After a few years of decline, litigation involving 401k plans "has surged again recently," according to a study published by the Center for Retirement Research at Boston College. This is likely not news to 401k sponsors and service providers, who are confronted with this reality on a near daily basis. The authors of the study point to some consequences -- good, bad, and mixed -- of the 401k litigation trends they've identified.

Source: Insidecompensation.com, July 2018

How Hidden Costs Can Dent Your Retirement Income

Abstract: For millions of retirees, hidden costs creep up on them. Just when they thought they were covered by Medicare and Social Security, they get clobbered. While Medicare does pay for the bulk of hospital-related expenses after age 65, there can be thousands of dollars in out-of-pocket healthcare expenses. You have to plan for them.

Source: Forbes.com, July 2018

Tackling Student Debt With 401k Savings

Abstract: Younger employees struggling to repay heavy student debt often delay saving for retirement. As a result, these employees lose the advantage of starting to save at an early age. Recently, Abbott, the pharmaceutical and medical products company, announced a new program to help employees build retirement savings in their 401k accounts at the same time they are repaying their student loans.

Source: Steptoe.com, July 2018*

In the Era of Electronic Enforcement, Fidelity Bond Issues Easily Revealed on Form 5500

Abstract: The fidelity bond requirement is high up on the DOL's compliance priorities, and it's not a great leap in logic to assume that the they monitor this on Form 5500. After all, it's the DOL who publishes the database. It could be a red flag for the DOL to take a closer look at the plan.

Source: Retirementplanblog.com, July 2018

Late 401k Deposits

Abstract: One thing participants do not review often enough is contribution deposit dates. Reviewing this information not only ensures that your employer is timely depositing your contributions, but also that any late contributions include an extra lost opportunity contribution in accordance with the DOL rules.

Source: Irahelp.com, July 2018

Your Plan Will Face a Cyber Attack. Here's How to Prepare

Abstract: One of the most difficult challenges for plan sponsors is determining where to start in their efforts to defend against increasingly sophisticated cyber attacks. This article is designed to assist plan sponsors with formulating and executing their strategy to protect their information and their assets.

Source: Callan.com, July 2018

Checksmart Wins Dismissal of 401k Excessive Fee Lawsuit

Abstract: Checksmart Financial LLC defeated a lawsuit accusing it of violating federal benefits law by offering high-fee, poorly performing investment funds in its $25 million 401k plan.

Source: Bna.com, July 2018

You've Discovered a Mistake in Your Plan Administration -- Now What?

Abstract: Occasionally qualified plan administrators discover that their plans have incurred an operational error. The IRS recognizes that it needs the help of plan administrators to police the administration of qualified plans and has correspondingly published guidance to help plan administrators take appropriate corrective action where necessary.

Source: Benefitslawadvisor.com, July 2018

Retirement Confidence Improving, But Effects From Great Recession Linger

Abstract: Many American workers are still recovering from the Great Recession, but most are focused on saving for retirement and have varying degrees of confidence they will be able to retire comfortably, according to a comprehensive study on worker perspectives.

Source: Asppa.org, July 2018

2018 RIA Benchmarking Study

Abstract: The 2018 RIA Benchmarking Study by Charles Schwab is the leading study of its kind in the RIA industry. The Study features insights based on self-reported information on topics such as asset and revenue growth, sources of new clients, products and pricing, staffing, compensation, marketing, technology, and financial performance.

Source: Aboutschwab.com, July 2018

The Fiduciary Rule May Be Dead, but Fiduciary Responsibility Isn't

Abstract: The death of the Fiduciary Rule does not mean that plan sponsors and committee members cannot insist on getting nonconflicted fiduciary advice. It just makes their job harder. It is worth the extra effort, because getting investment advice from an ERISA fiduciary makes a big difference.

Source: Penchecks.com, July 2018

Tax Code Changes Require Examination of Hardship Withdrawals

Abstract: Many 401k plans may need plan amendments to either bring them into compliance with TCJA and the Budget Act, offer the distribution opportunities now permitted following this legislation, or comply with regulations implementing these provisions that have yet to be written. The deadline for adopting these amendments may not be until December 31, 2019, or later and some plans may not require amendments at all.

Source: Ktserisacorner.com, July 2018

A Plan Sponsor Needs an ERISA Attorney

Abstract: Calling an ERISA attorney is always an issue if you've ever received a legal bill and were charged by the hour. While a plan sponsor may always fear a legal bill, they can't ignore their retirement plan problems because they will not go away. There are times when a plan sponsors seriously need to call an ERISA attorney.

Source: Jdsupra.com, July 2018

Automatic Enrollment in Small-business Plans Is Working

Abstract: Corroborating behavioral finance insights on saving habits, a survey by Vanguard of 8,900 small-business retirement plans found that those having automatic enrollment enjoyed an 83% participation rate, versus 58% for plans with voluntary enrollment. According to the survey, some 63% of employees at businesses that use Vanguard's small-business retirement plan service participated in their 401k plan, versus 61% in 2016.

Source: Investmentnews.com (registration may be required), July 2018

Should Participant Behavior Influence Investment Lineup Offerings?

Abstract: If you are holding onto a fund in your 401k plan that is underperforming short-term, but participants are signaling their dissatisfaction by transferring their money out, should you consider replacing the fund with something they'd find more attractive? The article gives some thoughts on this question.

Source: Fiduciaryplangovernance.com, July 2018

Will Working in Retirement Be the New Norm?

Abstract: While few current retirees take a job in their "golden years," a new study suggests that large percentages of future retirees expect to continue working during retirement, driven by uncertainty about Social Security and their own financial preparedness.

Source: Asppa.org, July 2018

Millennials Benefiting From Retirement Plan Modernization

Abstract: Millennials are the first generation to fully benefit from improvements made to retirement plans over the last decade, according to a survey from the Empower Institute. They are on track to replace 75% of their income in retirement, compared to 64% for Americans overall, 61% for Gen Xers and 58% for Baby Boomers.

Source: Planadviser.com, July 2018

Retirement Savings Lost and Found Act Reintroduced in Congress

Abstract: Previously introduced in 2016, U.S. Senators Elizabeth Warren and Steve Daines have reintroduced legislation aimed at addressing the retirement plan missing participant problem.

Source: Planadviser.com, July 2018

A Guide to Retirement Plan Fees & Expenses

Abstract: This paper discusses retirement plan fees and expenses with the intention of assisting retirement plan sponsors in achieving a greater understanding of their plan fees. For the purposes of this paper, it will categorize the fees and then detail the specific functions typically related to each expense.

Source: Multnomahgroup.com, July 2018

401k Fee Levelization -- It Can Make Revenue Sharing Worse

Abstract: Direct fees are more transparent and fair than revenue sharing payments, making it easier for 401k plan sponsors to keep their 401k fees in check. However, some 401k providers are now claiming to have fixed the problems with revenue sharing using a recordkeeping process called "fee levelization." This article discusses what "you should understand...about fee levelization."

Source: Employeefiduciary.com, July 2018

Five Trends in Participant Communications

Abstract: Retirement communications have reached a tipping point and leading plan providers are looking to embrace a new path. One that enables powerful and empowering participant experiences. Leaders see five converging trends. Any one of them would be challenging to manage. Taken together, they require fresh perspectives to find opportunities.

Source: Broadridge.com, July 2018

Hardship Distribution Cannot Be Taken for Repayment of Student Loans

Abstract: In Information Letter 2018-1, the IRS responded to a U.S. Congressman who asked why his constituent could not take a hardship distribution from his 401k plan to pay off his daughter's college student loans. The IRS explained that a hardship distribution must, among other things, be necessary to satisfy an immediate and heavy financial need. The IRS confirmed in the Letter that because a safe harbor hardship distribution may be made only for the prospective payment of education expenses, it cannot be made for the repayment of student loans.

Source: Drinkerbiddle.com, July 2018

The Benefits of a Non-Producing TPA

Abstract: As an advisor, you will need to decide which TPA to partner with when managing your client's 401k plan. As you are determining which provider to use, it is important to understand the distinct roles within the plan and how your partnership decisions could impact your client's experience.

Source: Rpgconsultants.com, July 2018

Is Your Plan Offering the Right Capital Preservation Option?

Abstract: Stable value funds are popular as a conservative investment option in defined contribution retirement savings plans. More so since regulations impacting money market funds took effect in 2016. To learn more about stable value's enduring appeal and why it makes sense in today's investment climate, PLANSPONSOR spoke with MetLife.

Source: Plansponsor.com, July 2018

Why Plan Participant Education Is Essential

Abstract: Plan participants often lack a solid understanding of what drives the success of their retirement savings, and increasingly, their unawareness is leaving them unprepared to leave work. Participant education is a crucial component of accountable sponsorship. This article discusses how to begin a consistent, effective program of participant education.

Source: Planpilot.com, July 2018

2018 Retirement Preparedness Study

Abstract: Many retirees are enjoying a secure retirement, but many pre-retirees envision that the "dream retirement" is becoming more elusive. This study explores how well individuals are preparing for retirement and how they are responding to the challenges they face.

Source: Pgim.com, July 2018

Cybersecurity and Retirement Plans

Abstract: This article discusses whether retirement plans are really at risk and, if so, why. It concludes with some helpful hints and practical advice to reduce cybersecurity risks, some of which are tips employers can share with retirement plan participants.

Source: Passwordprotectedlaw.com, July 2018

ERISA Bond: What Is It and Do I Need One?

Abstract: Almost every sponsor of every tax-qualified retirement plan must obtain a fidelity bond in accordance with section 412 of ERISA. Despite the broad application of this requirement, a surprising number of plan sponsors are unaware of this requirement and, in fact, do not have a bond at all or do not have a bond in the proper amount. This article helps explain the requirement to ensure that those who are subject to this requirement satisfy it.

Source: Legacyrsllc.com, July 2018

Changes to DOL Late Deferral Remittance Enforcement Procedure

Abstract: This article is intended to share a recent change to the DOL's enforcement procedures regarding the late remittance of participant elective deferrals by plan sponsors. Unfortunately, the DOL appears to have adopted a more aggressive and threatening approach about plan sponsors who attempt to correct such failures without pursuing "pristine" correction under the DOL's Voluntary Fiduciary Correction Program.

Source: Legacyrsllc.com, July 2018

Is Your 401k Plan One of the Best? Here's How to Tell

Abstract: How can you tell if your employer's 401k plan is a good one? Author shares his observations on the attributes of the best 401k plans.

Source: Lawtonrpc.com, July 2018

Judge dismisses Stock-Drop Suit Against Allergan

Abstract: A federal judge has dismissed a complaint by participants in an Allergan defined-contribution plan, rejecting allegations that company and plan executives violated their fiduciary duties by offering company stock in the plan menu.

Source: Investmentnews.com (registration may be required), July 2018

DOL Narrows Standards for Selecting Socially Responsible Retirement Plan Investments

Abstract: The DOL recently published guidance on the extent to which retirement plan fiduciaries can take into account environmental, social, or governance factors in selecting socially responsible investment funds for a retirement plan's investment line-up. With this fourth piece of guidance issued on this topic over the last fourteen years, the DOL continues to swing the pendulum on how much weight a plan fiduciary should give to ESG factors.

Source: Fulcrumpartnersllc.com, July 2018

When (If Ever) Can a Fiduciary Legally Engage in Self-Dealing?

Abstract: While all the talk has been about the now-vacated DOL Fiduciary Rule, we may have forgotten about the ongoing debate pertaining to the matter of self-dealing in circumstances where a fiduciary relationship clearly does exist. On the face of it, there appears to be little room for debate. Upon closer examination, however, the specifics of particular circumstances can muddle things up.

Source: Fiduciarynews.com, July 2018

Time for 401k Plan Sponsors to Revisit Your Hardship Withdrawal Provisions

Abstract: The Bipartisan Budget Act of 2018 includes several changes to the rules governing hardship withdrawals from 401k plans. Because the changes apply to plan years beginning after December 31, 2018, plan sponsors should start considering their options now and make decisions regarding which changes, if any, to implement to allow plenty of time to develop and timely distribute participant communications, update procedures and re-program plan administrative systems (including coordination with the plan recordkeeper's systems) and amend their plan documents.

Source: Employeebenefitsupdate.com, July 2018

Stakeholders Propose Ideas for Expanding the Determination Letter Program

Abstract: IRS received comments from trade organizations, law firms, and other stakeholders on what special circumstances beyond initial plan qualification and plan termination should merit a review of plan changes. It remains to be seen whether the IRS will allow determination letter applications for significant design changes, mergers, multiemployer plans, governmental plans, or other circumstances raised in these comments.

Source: Conduent.com, July 2018

What are the "Reasonable" Expenses That Can Be Paid Out From Plan Assets?

Abstract: Under ERISA, retirement plan sponsors have a fiduciary duty that requires them to act solely in the interest of plan participants and beneficiaries. Plan sponsors are also limited to using plan assets for the reasonable expenses of administering the plan. Using plan assets for other plan expenses could be a breach of the sponsor's fiduciary duty and lead to potential fines and costly litigation.

Source: Bsllp.com, July 2018

Tips for Engaging Employees in Plan Design Changes

Abstract: When employers are making changes, such as introducing a new benefits or pension offering, scaling back health benefits or changing plan design, it's important to engage employees and give them a chance to share their views.

Source: Benefitscanada.com, July 2018

Frequent 401k Audit Finding Series - Hardship Distributions

Abstract: During a 401k audit, hardship distributions are a common area where failures are discovered. The plan sponsor is often unaware that they were required to gather supporting documentation, and they have approved the distribution without verifying that an immediate need existed.

Source: 5500audit.com, July 2018

Is This the Most Absurd 401k Fraud Case Yet?

Abstract: According to a Matrix Trust representative, "Matrix Trust Company did not manage these investment accounts or serve as a trustee or fiduciary for them. This lawsuit involves accounts that were opened and managed by Vantage Benefits Administrators. Matrix's actions were consistent with its custodial agreements and intends to vigorously defend itself against these baseless claims."

Source: 401kspecialistmag.com, July 2018

Another State-Run Scheme to Fleece Worker 401ks?

Abstract: In addition to helping workers save, could state-sponsored retirement plans reduce reliance on food stamps, Medicaid and other publicly funded resources? It's one of the benefits pitched by public officials with Illinois Secure Choice, which launched its pilot program last week. The Prairie State hopes it will eventually help shrink (in part) ballooning deficits, as more people take responsibility for their own retirement saving and lessen dependency on state services.

Source: 401kspecialistmag.com, July 2018

T. Rowe Price 10th Annual Reference Point Benchmarking Report

Abstract: T. Rowe Price has released their 10th annual Reference Point benchmarking report (55-pages) of employer-sponsored retirement plans, which is based on the firm's full-service recordkeeping client data for 2017.

Source: Troweprice.com, July 2018

Collective Investment Trusts Show Gains Over Mutual Funds in DC Plans

Abstract: The Callan Institute's 2018 Defined Contribution Trends report is showing that sponsors of plans, including 401k and 457 plans, are looking at options besides mutual funds. Callan found that in 2017 fewer plans offered mutual funds (79.5%) than in previous years.

Source: Mfdf.org, July 2018

Four Different Ways to Rebalance Your 401k

Abstract: Once you've begun your investing trip, you may find that there are unexpected detours along the way like a stock market downturn or interest rate cuts that cause a bond rally. Don't let them throw you off your plan. Here are four ways to rebalance your investment mix to get back on track.

Source: Financialfinesse.com, July 2018

Top 10 Action Items for 401k Plans

Abstract: This checklist includes 10 items to help employers establish their compliance controls. These internal controls are critical in the event of an audit.

Source: Compliancedashboard.net, July 2018

New Proposed Securities Legislation Could Affect 401k Participants' Rights

Abstract: Last week, the U.S. House of Representatives Subcommittee on Capital Markets, Securities, and Investment took what many perceive could be another step in diminishing individual participant rights.

Source: Compliancedashboard.net, July 2018

Legal Risks Associated With a Retirement Plan's "Missing Participants"

Abstract: Besides being an administrative problem, the inability to locate terminated participants can represent legal risks. The DOL has asserted that a plan's inability to locate terminated participants can constitute a breach of duty on the part of the plan's fiduciaries, in violation of ERISA. Lost or missing participants can also lead to plan disqualification risks.

Source: Bsk.com, July 2018

The Retirement Plan Coverage Gap

Abstract: But despite all the change and innovation through good economic times and bad, one thing hasn't changed: the percentage of American workers covered by a workplace retirement plan. It's been an issue for a long time, but the tax reform debate has brought a whole new focus to the issue. Increasing access to coverage in a retirement savings plan is, without question, the next big policy issue for our industry.

Source: Asppa.org, July 2018

Simplifying 401k Choices Doesn't Help Employees Enroll

Abstract: Simplifying choices related to 401ks doesn't seem to help employees enroll in a plan or improve the amount they contribute, according to a recent IZA Institute of Labor Economics study. Data from the study suggest that simplifying the presentation of retirement-plan information to employees is unlikely to result in vastly improved retirement-planning choices.

Source: Wealthmanagement.com, July 2018

OregonSaves Retirement Plan Nears $5 Million in Savings After One Year

Abstract: Oregon's pioneering state-sponsored retirement plan reached its first birthday this week, after rapid growth during the past two months. OregonSaves now has enrolled more than 32,000 private-sector employees who previously didn't have access to a retirement savings option at work. They've so far set aside a combined $4.6 million of their own money through automatic payroll deductions, with an average withholding of 5.14 percent of salary.

Source: Registerguard.com, July 2018

Jive Software's New Owner Mishandled Former Employees' Retirement Accounts

Abstract: The company that now owns Jive Software has bungled management of former Jive employees' private retirement accounts, creating weeks of uncertainty over the status of their savings and an administrative mess. Former employees say the new owner suddenly locked them out of their 401k accounts in June while making an unannounced change to the company managing those accounts.

Source: Oregonlive.com, July 2018

Less Is Not More: Information Presentation Complexity and 401k Planning Choices

Abstract: This 40-page paper presents the results of an experiment that is designed to examine how information presentation and complexity impact retirement-savings behavior. The hypothesis is that providing concise information with helpful recommendations would improve choices over providing lengthy and detailed information. However, the data suggest that simplifying the presentation of 401k plan information to employees is unlikely to result in vastly improved retirement-planning choices.

Source: Iza.org, July 2018

How the DOL Fiduciary Rule Changed Norms

Abstract: The Department of Labor fiduciary rule might be history, but many financial professionals will continue to feel the effects of its rules for some time to come. They will feel that impact in two ways: from the changing norms fueled by the three-year interaction with the DOL rule; and from lingering department guidance that lives on.

Source: Insurancenewsnet.com, July 2018

Americans With Low Savings May Not Have to Work Until They're Dead

Abstract: If, like most Americans, your plan participants didn't save enough for retirement, they might not have to tighten their belt as much as once thought. In fact, most retirees can avoid taking drastic measures by combining retirement strategies, according to a recent report by Chicago-based Morningstar.

Source: Fa-mag.com, July 2018

Recordkeeper Defeats Second Round of Robo-Adviser Fee Litigation

Abstract: The court rejected the argument that constraining the plan's service provider choices amounted to de facto control since the plan had other alternatives to choose from (such as not using an investment adviser or changing recordkeepers) and dismissed the claim without leave to amend, ending the case at the district court.

Source: Erisapracticecenter.com, July 2018

DOL, Thrivent Ask Judge to Keep Fiduciary Rule Case Open

Abstract: The Labor Department and Thrivent Financial for Lutherans don't want a federal judge in Minnesota to close a case that narrowly challenged an Obama-era rule that would require investment advisers to put the interests of retirement savers above their own. The parties agreed that despite an appeals court decision that struck down the fiduciary rule in its entirety, its related litigation hasn't been finally resolved.

Source: Bna.com, July 2018

Safe Harbor 401k Plans: Everything You Need to Know

Abstract: A safe harbor 401k plan is a type of tax-deductible 401k match that companies use to help themselves pass IRS non-discrimination testing. Safe harbor plans mean that all eligible employees in the company are entitled to the same match, regardless of their title, compensation, or length of service.

Source: Humaninterest.com, July 2018

Profit Sharing Plan: How Is It Different From a 401k?

Abstract: In addition to 401k plans, there is another defined contribution workplace retirement plan known as a profit sharing plan. Like 401k plans, profit sharing plans are employer-sponsored retirement plans that are subject to federal laws and protections. But they differ from 401ks in a few key ways.

Source: Humaninterest.com, July 2018

How to Pick a Beneficiary for Your 401k Plan

Abstract: You might not be able to spend all the money in your 401k plan before you die. If that happens, your retirement savings will pass to the person you name as the beneficiary of the account. The information on your 401k beneficiary form typically supersedes what is written in your will, so it's important to keep this form up to date for all your retirement and investment accounts.

Source: Usnews.com, July 2018

The Benefit of Saving Regularly for Retirement

Abstract: This article explains how saving at least 15% of gross income (including employer contributions) can allow individuals to save enough for retirement that could last decades. An automated approach to saving on a regular basis ensures it's a priority and helps take the emotion out of investing.

Source: Troweprice.com, July 2018

Matrix Trust Company Accused of Making Unauthorized Transfers of 403b Plan Assets

Abstract: Plan participants have filed a lawsuit against Matrix Trust Company for making several transfers to an unauthorized account held by recordkeeper Vantage Benefits Administrators.

Source: Planadviser.com, July 2018

401k Data Dilemma Is Hurting the Industry

Abstract: As the tech world moves at lightning speed to leverage consumer data to provide efficiencies and better client experiences, the defined contribution world is taking a Luddite stance, with no apparent solution in sight.

Source: Investmentnews.com (registration may be required), July 2018

Three Reasons Cryptocurrency Is Making Its Way Into Retirement Plans

Abstract: Cryptocurrencies represent one of the newest, fastest growing and most intriguing asset classes around. But do they belong in a retirement account? Many Americans believe so. Here are three reasons some are starting to create a cryptocurrency IRA as part of their overall retirement portfolio.

Source: Forbes.com, July 2018

Top Fiduciary Questions 401k Plan Sponsors Must Ask

Abstract: For many plan sponsors, their real job has nothing to do with running the company retirement plan. Yet, being named a plan sponsor may carry greater personal risk than their real job. This article identifies fiduciary questions every 401k plan sponsor must ask, what the best answers to those questions are, and why they are important.

Source: Fiduciarynews.com, July 2018

IRS Appears Likely to Expand Determination Letter Program in 2019

Abstract: All signs point to the IRS expanding access to the determination letter program for individually designed plans in 2019. This would be a welcome move for employers and other plan sponsors, who have been unable to obtain determination letters with respect to most ongoing plans since the DL program as we knew it ended last year.

Source: Employeebenefitsupdate.com, July 2018

Podcast: Fixing Retirement Plan Overpayments

Abstract: This 8-minute podcast discusses how to fix retirement plan overpayments, based on (1) the type of plan, (2) whether the overpayment was with respect to a lump sum or ongoing payments, (3) the type of overpayment (whether it was to the wrong person or paid at the wrong time), and (4) who caused the overpayment. They discuss the requirements, the decisions involved, and certain ERISA and taxation issues that can arise when addressing these overpayments.

Source: Benefitsbrief.podbean.com, July 2018

Ways & Means Responds on Rothification Rumors

Abstract: Rumors notwithstanding, the House Ways & Means Committee tells the American Retirement Association, the committee has no plans to revisit Rothification as part of the new tax reform discussions.

Source: Asppa.org, July 2018

Average 401k Deferral Rates Skyrocket

Abstract: Market appreciation and an increase in default deferral rates sent participant account balances soaring in 2017 when compared with the previous year. T. Rowe Price said the average employee pre-tax deferral rate reached 8.3 percent, the highest in 10 years, the company noted, citing its participant data.

Source: 401kspecialistmag.com, July 2018

Why Sponsors Include Sustainable Investing in 401k Menus

Abstract: Growth has been primarily fueled by an increased appetite from participants, interest from plan sponsors to align DC menus with their corporate values, and a growing set of investment capabilities that fit the performance needs and values of investors.

Source: 401kspecialistmag.com, July 2018

Student Loans Make 401k Savers Squeamish

Abstract: Student loan debt almost tripled "in real terms" between 2005 and 2017, garnering much attention from media and researchers, who question the impact this is having on the finances of those who are indebted. In a recent brief, the Center for Retirement Research at Boston College took a closer look at how student loan debt affects participation in 401k plans.

Source: 401kspecialistmag.com, July 2018


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