Help for 401k plan sponsors, retirement professionals, small business, employee and 401k rules


Subscribe RSS Feed

Free Weekly 401k eNewsletter

Click for EmployeeBenefitsJobs.com

Definitions
Glossary of Terms
Retirement Industry Acronyms and Abbreviations

Got News

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, 403(b) 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.

Use the SEARCH feature to located specific items from this digest and from our ARCHIVE.


    
DOL Offers Some 'Friendly' Advice to Supremes on 401k Fee Case

Summary: The DOL has offered some "friendly" advice to the U.S. Supreme Court as it considers a review of a high-profile 401k fee case. In a "friend of the Court" amicus brief filing, the DOL said it thinks that the high court should weigh in on the statute of limitations issue presented in Tibble v. Edison, but not on the issue of reviewing an alleged breach of duty in administering the plan in accordance with its terms.

Source: Napa-net.org, August 2014

Unhappy 40th Birthday, ERISA: So Much for Retirement Security

Summary: The enactment of ERISA in 1974 was inspired by the 1963 collapse of the Studebaker Corporation, whose pension was so poorly funded that even workers with 10 years of service got a tiny pension and about a third of the workers got nothing. The bill was sponsored by the late Senator Jake Javits, who saw it as just one step towards a more satisfactory private retirement system. Author writes, "Let's make sure Senator Javits' efforts weren't in vain. We need to put pressure on Congress to move on [pension reform]."

Source: Huffingtonpost.com, August 2014

Industry Leaders Share Thoughts About ERISA

Summary: Forty years ago on September 2nd, in response to failing companies resulting in workers losing pensions, sweeping legislation designed to protect workers from losing their earned retirement income was signed into law.

Source: Plansponsor.com, August 2014

Company Owner Pleads Guilty to Falsifying ERISA Disclosures

Summary: The owner of a Maryland electrical contracting company pleaded guilty to falsifying plan documents to avoid making contributions to several employee benefits plans.

Source: Plansponsor.com, August 2014

Court Blocks DC Plan Participant Claims Against Madoff Trustee

Summary: A federal bankruptcy judge has affirmed the denial of recovery claims from retirement plan participants who indirectly invested in the now-infamous Bernie Madoff Ponzi scheme.

Source: Planadviser.com, August 2014

DOL Pronouncements regarding Missing Participants and Brokerage Windows

Summary: In the last month, the DOL has issued two significant regulatory pronouncements. In FAB 2014-01, DOL provides updated guidance on the fiduciary duties that apply to locating and distributing assets attributable to missing participants in a terminating plan. Second, a RFI provides DOL's opening volley in what could amount to regulatory action addressing fiduciary and other standards that apply to open brokerage windows offered in participant-directed defined contribution plans. Article summarizes both pieces of DOL guidance.

Source: Groom.com , August 2014

The Power of the "All-In" 401k Fee

Summary: Under an all-in fee approach, all administrative, recordkeeping and investment expenses are summed into a single, total amount. This approach "normalizes" the numerous fee arrangements used by 401k service providers, including compensation paid to providers from plan investments, making it easier for the sponsor to compare fees provider by provider. It does matter if fees are paid directly by an employer or deducted from participant accounts or paid indirectly from revenue sharing or wrap fees. Regardless of the compensation's origin, it should be included in the all-in fee total.

Source: Employeefiduciary.com, August 2014

DOL Opens the Door to Questioning Brokerage Windows Under 401k Plans

Summary: This RFI could signal an effort on the part of the DOL to promulgate additional regulatory requirements or other guidance applicable to the use of brokerage windows, with possible impact on plan sponsors that may offer windows under their plans and also on financial institutions that provide or facilitate the windows.

Source: Edechert.com, August 2014

Saving Retirement, Without the Fiduciary Risk

Summary: Imagine a world where employers provide retirement security for their employees through a uniform, standardized defined contribution platform, and in the process, assume absolutely no fiduciary risk. None whatsoever. Sound like fantasy? Not to Russell 'Rusty' Olson.

Source: Benefitspro.com, August 2014

IRS Issues Retirement Plan Group Investment Trust Guidance

Summary: The IRS has issued Revenue Ruling 2014-24, providing additional guidance on the ability of certain retirement plans qualified under Puerto Rico tax laws to participate in group trusts for investment purposes. The guidance also addresses insurance contracts in the retirement plan group trust context.

Source: Ascensus.com, August 2014

Generation X Workers' Retirement Collision Course Can Still Be Corrected

Summary: Transamerica Center for Retirement Studies released a this report, Generation X: Retirement Reality Bites Unless Answers Are Implemented, revealing the current lack of retirement preparedness among Generation X workers (born between 1965 and1978) that identifies opportunities for improving their long-term outcomes.

Source: Transamericacenter.org , August 2014

Why 'Unretirement' Might Be Your Best Retirement Strategy

Summary: Chris Farrell argues that developing skills that can help you earn income well past traditional retirement age offers a better return on investment than any financial instrument. Article is a Q&A with Farrell.

Source: Reuters.com, August 2014

Automatic Rollovers Not Just for Active Plan Cleanup

Summary: Implementing an automatic rollover program can help retirement plan sponsors establish safe harbor individual retirement accounts for missing or non-responsive participants.

Source: Plansponsor.com, August 2014

401k Fiduciary Breach Lawsuit Heads to the Supreme Court

Summary: A classic 401k lawsuit centered on whether an employer violated its fiduciary duty when choosing retail funds over cheaper institutional share classes has been green-lighted for review by the Supreme Court.

Source: Investmentnews.com (free registration may be required), August 2014

What Top 401k Plans Do Differently

Summary: When it comes to getting workers, particularly lower-earning workers, to save more of their money, the effort goes beyond plan design. Advisers find that it makes sense to talk to them about the saver's credit, a tax credit for employees that can be as high as 50% of their contribution, depending on their adjusted gross income.

Source: Investmentnews.com (free registration may be required), August 2014

Employees Are Falling for Roth 401k's

Summary: Employees saving for retirement in workplace 401k plans are increasingly choosing the Roth option, according to a recent Aon report. When the Roth option is available, 11% of participants contribute to a Roth, up from 9.6% in 2012 and 8.1% in 2011. The report sheds some light into the decision-making process of employees and suggests that more employers should offer the Roth option.

Source: Forbes.com, August 2014

Professional Retirement Plan Advisors Have Significant Impact on Retirement Plan Performance

Summary: Transamerica Retirement Solutions released a research report highlighting the benefits of partnering with a professional retirement plan advisor. This study demonstrates that professional retirement plan advisors are central to the strategic direction, administration, and overall performance of the retirement plans they manage. The study defines professional retirement plan advisors as those who work primarily or exclusively with retirement plans.

Source: 401khelpcenter.com, August 2014

DOL Provides Much Needed Guidance on "Orphan Accounts"

Summary: It is estimated that in 2010, there was $1 trillion in orphaned retirement accounts. As individuals continue to have more and more jobs during their careers, the number of accounts and dollars within these accounts can be expected to grow. DOL Field Assistance Bulletin No. 2014-01 lays out some required steps plan fiduciaries should take to find missing participants.

Source: Schneiderdowns.com, August 2014

Speakers Tell Council DOL Guidance Needed to Boost Savers' Lifetime Income Options

Summary: A combination of guidance and online tools from the DOL on lifetime income would help retirement plan participants make good decisions about their retirement funds and investments, speakers told the ERISA Advisory Council.

Source: Pensionrights.org , August 2014

Oregon's Auto IRA Mandate Takes Shape

Summary: With the official report not due until September, a draft report released by the Oregon legislature's Task Force on Oregon Retirement Savings offers a blueprint of a proposed new mandatory auto IRA program for the state.

Source: Ntsa-net.org, August 2014

Increasing Participation Rates in 403(b) Plans

Summary: Employers are increasingly concerned about low participation rates in 403(b) plans, in particular plans in the public education K-12 market segment where there are most often no matching contributions. Article reviews some strategies for increasing participation.

Source: Ntsa-net.org, August 2014

Fiduciary Guarantees -- There's Tinsel on the Tinsel

Summary: Sometimes called the fiduciary promise, industry messaging misleadingly overstates its value to plan sponsors. Words such as "guarantee" and "warranty" connote protection and security -- that sense that I can't be harmed if things go wrong because someone else has promised to protect me. In the 401k context, this generally means its "my provider -- not me-- who will be liable." But these promises fall far short of delivering plan sponsors meaningful protection from fiduciary liability.

Source: Fiduciaryplangovernance.com, August 2014

The Fiduciary Quicksand of Acquiring, Holding and Selling Employer Stock

Summary: Congress knew that holding large amounts of employer stock in a company's pension plan created significant tension between the intrinsically high risk of a single stock and the demands of a fiduciary's standard of conduct. Five page article gets into detail on the legal and fiduciary foundation of holding employer stock in a plan.

Source: Erisafiduciaryadministrators.com, August 2014

Supreme Court Urged to Hear Fiduciary Case

Summary: The U.S. Solicitor General has produced a brief at the request of the U.S. Supreme Court that recommends the justices hear part of the original claims in Tibble v. Edison International. The Solicitor General's brief was split on the two questions the plaintiffs are asking the court to review.

Source: Benefitspro.com, August 2014

Help Your Retiring DC Members

Summary: The fear of increased fiduciary responsibility has kept most Canadian plan sponsors away from helping members past the accumulation phase of their group retirement and savings arrangements. Yet we are seeing more and more sponsors dip their toes in the water and get involved.

Source: Benefitscanada.com, August 2014

DOL Requests Comments on Brokerage Windows in 401k Plans

Summary: On August 20, 2014, the DOL published a request for information on the use of these brokerage windows 401k plans. The DOL's goal in issuing the request for information is to assist the DOL in determining whether, and to what extent, regulatory standards or other guidance concerning the use of brokerage windows may be necessary to protect plan participants.

Source: Winston.com, August 2014

Retirement Savings: A Tale of Decisions and Defaults

Summary: This paper examines the default behavior of the members of an industry-wide pension fund to assess both the prevalence of defaults and their impact on retirement accumulation using Australian pension fund. Paper shows that the default structure, which specifies individual's outcomes when no choices are made, strongly influences wealth accumulation.

Source: Ssrn.com, August 2014

Why Plan Sponsors Are Buying 401k Liability Insurance

Summary: As legal shake-ups rattle more plan sponsor windows, warranties and fiduciary insurance policies in the 401k arena are making a comeback, despite the long memories of some prominent skeptics who recall how rotten such policies were the first time around.

Source: Riabiz.com, August 2014

A 401k Rollover Checklist

Summary: Old 401ks are a little like the old clothes in the back of your closet. You know you should do something about them. So is deciding what to do with an old 401k on your to-do list? Here are seven steps for getting it done.

Source: Morningstar.com, August 2014

401k Plans Work in a Balanced Approach to Retirement Security

Summary: Author writes, "[T]aken as part of a broader retirement system, 401ks work for working Americans. Retirees do face legitimate risks -- but the decline of private-sector defined benefit plans and the rise of defined contribution plans, such as 401k plans, isn't one of them. This shift isn't unlikely to reduce retirement preparedness."

Source: Ici.org, August 2014

Inside the Structure of DC/401k Plan Fees

Summary: As part of an ongoing comprehensive research program, the Investment Company Institute and Deloitte Consulting have prepared this third edition of the Defined Contribution/401k Fee Study. Specifically, this report addresses and updates: The mechanics of defined contribution plan fee structures; Components of plan fees; and Factors that impact fees ("fee drivers").

Source: Ici.org , August 2014

Interview With CFDD's Phil Chiricotti (Part 4)

Summary: Chiricotti talks about proposed legislation that might actually help 401k plan sponsors and participants, especially those from smaller companies. He suggests that Multiple Employer Plans are a suitable vehicle to help broaden retirement plan coverage as well as to outsource complex compliance and administrative issues.

Source: Fiduciarynews.com, August 2014

Interview With CFDD's Phil Chiricotti (Part 3)

Summary: About a fiduciary standard, Chiricotti says, "while we like stirring the pot, the CFDD has never been a missionary zealot for the fiduciary standard or anything else. We have, however, been quite vocal about the need for fiduciaries and advisors servicing ERISA plans to be qualified."

Source: Fiduciarynews.com, August 2014

SEC Money Market Reform -- ERISA Impact

Summary: The SEC has published its final regulations that reform money market mutual funds. The regulations provide for two core reforms. As a result of these reforms, plan sponsors and fiduciaries should consider several issues outlined here.

Source: Employeebenefitslawreport.com, August 2014

America Has a Retirement Spending Problem

Summary: The ongoing debate about Americans' saving behavior during their working years misses the equally important question of whether retirees will spend their nest egg in the right way. Americans are not perfect savers, but retirement security requires much more than just a high personal saving rate. Contrary to public sentiment, America has a retirement spending problem, not just a saving one.

Source: Brookings.edu, August 2014

Time to Change Your Target-Date Fund Line-Up?

Summary: On the surface, TDFs are simple and, although they might be the most recent addition to your 401k plan, that's no reason to take your eye off your target-date fund line-up. Article suggests a closer look would definitely seem to be in order.

Source: Benefitspro.com, August 2014

401k Participation High, but Workers Still Could Face Shortfalls; Survey

Summary: Participants in 401k retirement plans who work with financial advisors save more and have clearer financial goals than their peers, according to a study by Natixis Global Asset Management. Overall, however, the study shows many workers -- including those close to retirement -- aren't on track to meet the savings targets they've set for themselves.

Source: 401khelpcenter.com, August 2014

Study Shows Long-Term Downward Trend of 401k Fees

Summary: Participants in 401k plans incurred lower expenses investing in long-term mutual funds (equity, hybrid, and bond funds) in 2013 than in 2012, an Investment Company Institute study has found. The decline in 401k plan fees is consistent with the downward trend of the past decade, the ICI said.

Source: Wolterskluwerlb.com, August 2014*

Target-Date Funds: Proprietary or Customized?

Summary: Even as target-date funds have become extremely popular in defined contribution plans over the last decade, there's also been growing interest in plan-specific or customized target-date programs. This paper can help sponsors choose among those options by analyzing key aspects of the proprietary versus customized decision.

Source: Vanguard.com, August 2014

Embracing the Trend: Has Your Plan Considered Relaxing Eligibility Requirements?

Summary: Did you know the length of time an employee is required to wait to begin participating in the retirement plan can have a direct impact on that individual's retirement readiness? Over the past decade, there's a growing trend of retirement plans relaxing eligibility requirements.

Source: Pension-Consultants.com, August 2014

DOL Eyes Brokerage Windows in 401k Plans

Summary: The Labor Department is setting its sights on brokerage windows in 401k plans, requesting information from the industry on the types of choices available and how much is disclosed to participants.

Source: Investmentnews.com (free registration may be required), August 2014

Interview With CFDD's Phil Chiricotti (Part 2)

Summary: According to Phil Chiricotti, "industry forces fighting coverage solutions like MEPs and outsourced 3(16) services along with the fiduciary standard are providing the government and DC plan critics with the ammo to launch their own solutions, undermine the industry, and eventually take over the private system."

Source: Fiduciarynews.com, August 2014

DOL Requests Information on Use of Brokerage Windows in 401k Plans

Summary: The U.S. Department of Labor published in the August 21st Federal Register this request for information on the use of brokerage windows, self-directed brokerage accounts and similar features in 401k-type plans.

Source: Dol.gov, August 2014

Something Else to Concern Plan Fiduciaries -- The Floating NAV Rule

Summary: The SEC has promulgated a rule addressing what it believes could be heavy redemptions of money market mutual funds in the event of economic stress. The MMF Rule intends to make information about money market mutual funds, particularly inherent risk factors, more transparent. It would behoove plan administrators and their investment advisors to reassess the type of money market mutual fund held by the retirement plan and determine if it continues to be a proper investment for the plan.

Source: Benefitsbryancave.com, August 2014

401k Participant Survey

Summary: Findings include that, Aside from health insurance, a 401k plan is the must-have benefit and participants seek help in doing some of life's chores, but less so when it comes to choosing 401k investments.

Source: Schwab.com , August 2014

DOL Updates Guidance on Missing or Unresponsive Participants

Summary: This FAB provides a helpful update to the DOL's earlier guidance, taking into account intervening developments and offering a more detailed explanation of the DOL's position. If audited, plan fiduciaries must be able to demonstrate compliance with ERISA's fiduciary standards for all decisions made to locate missing participants and distribute benefits.

Source: Ebia.com, August 2014

Quantifying the Impact of Chasing Fund Performance

Summary: This Vanguard research simulates a performance-chasing strategy among U.S. equity mutual funds for the ten years ended December 31, 2013 and compares the results with a buy-and-hold strategy over the same period. The analysis shows clearly that buy-and-hold has been the superior approach.

Source: Scribd.com, August 2014

DOL Addresses Fiduciary Duty to Locate Missing Participants

Summary: In Field Assistance Bulletin 2014-01, the Department of Labor addressed how fiduciaries of terminated defined contribution plans can properly fulfill their obligation to search for missing participants and distribute their benefits. Article provides a comprehensive overview.

Source: Practicallaw.com, August 2014

Handling Missing Participants Upon Plan Termination

Summary: The DOL recently issued new guidance that discusses how plan fiduciaries should try to handle the search for and if the search is unsuccessful, then the disposition of participant accounts if participants cannot be located. Even though this guidance is specifically for terminated plans, one would think that the same logic would apply to missing participants in on-going plans. reviews details.

Source: Plandesignconsultants.blogspot.com, August 2014

Divided Fourth Circuit Panel Rules On Burden of Proving Loss Causation in ERISA Fiduciary Breach Case

Summary: The Fourth Circuit's decision makes a number of significant statements and rulings on the burdens of proof related to loss causation, the meaning of "objective prudence," and the standards for reviewing decisions pertaining to stock funds in the wake of the Supreme Court's ruling in Fifth Third v. Dudenhoeffer. Some of the Court's pronouncements are difficult to reconcile with existing case law.

Source: Jdsupra.com, August 2014

Deloitte's Annual Defined Contribution Benchmarking Survey

Summary: Plan sponsors responding to Deloitte's Annual Defined Contribution Benchmarking Survey report an encouraging six percentage point uptick in the average employee participation rate, which rose from 71 percent in 2012 to 77 percent in 2013. But figuring out how to lure the remaining quarter of employees and increase engagement levels overall continues to be a perplexing challenge. The improving economy seems to have alleviated some employee anxiety about setting aside money for the future. Report is 85 pages.

Source: Deloitte.com , August 2014

What Plan Sponsors Need to Know About Money Market Fund Changes

Summary: The SEC recently adopted amendments to the rules that govern money market mutual funds. Two of the four changes to money market funds will probably require plan sponsors' attention. Article reviews what 401k plan sponsors need to know.

Source: Benefitnews.com, August 2014

The State of 401k Investing: Schwab Survey

Summary: Although survey participants clearly want 401k plans and appreciate their role in working toward post-retirement financial security, most are not using professional advice that may help improve outcomes. In fact, respondents say they are much more likely to have someone change the oil in their car (87%) than have someone help them choose their 401k investments (24%).

Source: 401khelpcenter.com, August 2014

Interview With CFDD's Phil Chiricotti (Part 1)

Summary: Chris Carosa writes of this interview," Phil Chiricotti's blunt no-holds-barred style makes him a perfectly delicious interview. His incendiary commentary is so provocative we considered whether it would be too hot for our readers. But, then again, our readers are old enough to play with fire, so we decided to give Phil the keys to the typewriter and have him do what his may."

Source: Fiduciarynews.com, August 2014

Survey: 36 Percent Not Saving for Retirement

Summary: More than a third of adults say they have not started saving for retirement yet, according to a national poll accompanying Bankrate's monthly Financial Security Index. Even Americans who are getting close to retirement age seem to be struggling when it comes to planning their financial future. The survey shows that more than a quarter of the respondents age 50 to 64 have yet to start saving for retirement.

Source: Bankrate.com, August 2014

Age Isn't Keeping Retirement Plan Participants From Social Media

Summary: New research from Spectrem Group indicates that defined contribution plan participants are increasingly taking to social media for financial activity and advice, regardless of age.

Source: 401khelpcenter.com, August 2014

Millennials Emerging as "Retirement Super Savers," Transamerica Survey Finds

Summary: Millennial workers (those born between 1979 and 1996) are emerging as a generation of retirement "super savers," according to a survey conducted by the Transamerica Center for Retirement Studies. Millennial workers are focused on retirement in a big way. The research found that three out of four are already discussing saving, investing, and planning for retirement with family and friends.

Source: Wolterskluwerlb.com, August 2014

No Plans to Establish Determination Letter Program for Individually Designed 403(b) Plans: IRS official

Summary: The new 403(b) pre-approved plan program has no mechanism for providing opinion and advisory letters to plan sponsors of individually designed 403(b) plans, said IRS officials during a July 28, 2014 IRS phone forum on the pre-approved 403(b) plan program. Nor is the IRS planning to establish a determination letter program for individually designed 403(b) plans.

Source: Wolterskluwerlb.com, August 2014

How to Overcome Behavioral Biases, Raise Retirement Savings

Summary: An overwhelming difficulty in getting workers to actively participate in their plan is the disconnect between current and future needs. Cerulli referred to a Prudential study that found investors are apathetic about saving for retirement because they see their future selves as a stranger.

Source: Thinkadvisor.com, August 2014

Prune Those 401k Plan Investment Lineups

Summary: Studies have shown that too many funds on a plan's investment lineup actually lowers the rate at which participants defer their salary in a 401k plan. Why? Too many funds, especially in one asset class have the ability to confuse and overwhelm plan participants and overwhelmed plan participants are less likely to defer than those that aren't.

Source: Jdsupra.com, August 2014

Updated Guidance on Dealing With Missing Participants

Summary: Field Assistance Bulletin 2014-01 provides updated guidance on dealing with missing participants when a defined contribution plan terminates. It updates and replaces the prior Field Assistance Bulletin previously issued.

Source: Benefitsforward.com, August 2014

Canadians Say Their Savings Habits Are Poor

Summary: Many admit there's a lot of room for improvement when it comes to their savings habits and financial goals, finds a survey by Tangerine. When asked to grade their savings habits, 46% gave themselves a "C" or lower, saying they need to get back on track or haven't yet started saving this year. And 46% of people surveyed also admitted they don't have a regular savings plan set up to put aside money each month.

Source: Benefitscanada.com, August 2014

Oregon Looks to Establish State-Run Retirement Plan for Private Sector Workers

Summary: Oregon's Retirement Savings Task Force is calling on the state to create a retirement fund that would be available to all employed state residents that will follow Oregonians as they transition between jobs.

Source: Benefitnews.com, August 2014

Fidelity Settles 401k Suit with Employees for $12 Million

Summary: The settlement ended two lawsuits brought by employees. In addition to the multimillion-dollar payment, the investment management firm agreed to take a series of actions for the participants.

Source: Thompson.com, August 2014

The Impact of Future Contributions to DC Plans on Retirement Income Adequacy for Gen Xers

Summary: One of the major findings in each of the annual EBRI RSPM studies since 2010 (which differs sharply from both the Pew and CRR conclusions) was that the overall retirement income adequacy prospects for Gen Xers were approximately the same as for Early Boomers and Late Boomers. This paper compares the EBRI model results in detail to both the Pew and CRR reports.

Source: Ssrn.com, August 2014

Have Missing Participants? The DOL Says, "Google Them!"

Summary: The DOL released Field Assistance Bulletin 2014-01 which updated its 10-year-old guidance on how to deal with the accounts of missing or unresponsive participants and beneficiaries in a terminating defined contribution plan that does not have annuity options.

Source: Benefitsbryancave.com, August 2014

ERISA@40: A History Lesson

Summary: ERISA's birth came just after the US ended direct military involvement in the Vietnam War and the resignation of President Nixon amidst the Watergate scandal. It was the end of an era when employers could disclaim liability for defined benefit plans; it was the beginning of an era that provided a pension bill of rights for US workers.

Source: Xerox.com , August 2014

New Companies Try Filling 401k Fee Disclosure Gap, Fall Short

Summary: Want proof that the DOL's fee disclosure regulations have not met expectations? There are a growing number of websites that claim to use technology to help sponsors or participants understand or uncover 401k fees. A classic case of the private sector correcting something government got wrong.

Source: Employeefiduciary.com, August 2014

IRS Newsletter Highlights Plan Terminations

Summary: In a recent newsletter, the IRS highlighted updated plan termination resources, including a step-by-step guide to terminating a retirement plan, guidance on required plan amendments, frequently asked questions, and specific termination guidance for each type of retirement plan, including a 401k plan.

Source: Ebia.com, August 2014

Embracing Social Media and Mobile Technology in 401k Communications

Summary: The participation in social media and the use of mobile technology among 401k plan participants has increased exponentially. Although traditional benefits communication vehicles have not yet become obsolete, plan sponsors need to take a multichannel approach to benefit communications by factoring in social media and mobile technologies. Article provides some insight.

Source: 401khelpcenter.com, August 2014

Avoid Litigation by Helping Plan Sponsors Become Better Fiduciaries

Summary: While 401k plans continue to grow in popularity, so has the immense scope of complexity surrounding compliance. Lately there's more attention and scrutiny from regulators and lawyers, making it imperative for plan sponsors to understand their fiduciary roles, the overall process, and how to safeguard themselves before an examination.

Source: Thefiresystem.com , August 2014

Survey Reveals High Level of Uncertainty Among Plan Administrators

Summary: Strategic Benefit Services' 2014 Retirement Plan Survey uncovers significant uncertainty among employers about retirement plan administration. The survey, which sought to identify significant trends in retirement plan services, found: Nearly 80% of respondents said they were unsure if their plan advisor was acting in a fiduciary capacity; 17% percent of respondents were unsure how their advisors were compensated; and one quarter said they were unsure how often their plan went out to bid, with 22% indicating their plan had never been put out to bid.

Source: Strategicbenefitservices.com, August 2014

Retention of Plan Documents: A Primer

Summary: As a plan sponsor, you have a duty to maintain sufficient records for a period of time. But what does this statement really mean? How long is this "period of time"? What are "sufficient records"? What are the consequences of not retaining such records or of losing them? This article addresses these questions.

Source: Pension-Consultants.com, August 2014

The Reckless Fiduciary: When Are Imprudent Fiduciaries Liable for Plan Losses?

Summary: A recent Fourth Circuit Court of Appeals case has established its own gloss on the ERISA rules to determine when fiduciaries who follow imprudent procedures will have to make up plan losses. The Fourth Circuit rule is based on what a hypothetical prudent fiduciary, who I will call the "prudent shadow," would have done in the same situation.

Source: Pensionsbenefitslaw.com, August 2014

Why Have an Annual Investment Review?

Summary: Active investment managers, no matter their investment philosophy, live and breathe their investment decisions. Tactical allocators and long-short managers must evaluate and re-evaluate the composition of their clients' portfolios regularly. But for managers with a passive or evidence-based investment philosophy, what type of investment review is relevant?

Source: Morningstar.com, August 2014

The Small Things that Create the Biggest Problems for 401k Plan Sponsors

Summary: When it comes to being a retirement plan sponsor, the greatest threats in breaching fiduciary duty resulting in liability usually comes from the smallest mistakes. This article is to let you know which small mistakes to avoid.

Source: Jdsupra.com, August 2014

In Defense of the Traditional 401k

Summary: Author write, "Should you make pre-tax or Roth 401k contributions? I recently read this article by Penelope Wang called 'The Great Retirement Account You're Not Using' that argues for Roth contributions. However, I still think pre-tax contributions make more sense for most people. Here is my response to each of her main arguments."

Source: Financialfinesse.com, August 2014

Field Assistance Bulletin No. 2014-01: Missing Participants

Summary: A plan fiduciary make reasonable to find missing participants and distribute benefits on their behalf. They must also be able to demonstrate compliance with ERISA's fiduciary standards for all decisions made and demonstrate compliance using paper or electronic records. This FAB reviews how fiduciaries can fulfill their obligations under ERISA to locate missing participants and properly distribute the participants' account balances.

Source: Dol.gov, August 2014

How Exactly Fidelity Investments Extracted Itself From a Legal and HR Quagmire

Summary: Fidelity Investments has quickly and quietly put the ugliest kind of lawsuit to rest -- one in which, technically, Fidelity's 50,000 employees past and present were suing Fidelity as a corporation over conflicts of interest in its $10-billion 401k plan. In drawing a line under the lawsuit that used ERISA as a legal hammer, the Boston-based firm with its $4 trillion in assets under administration was able to pay a $12-million pittance and admit no wrongdoing.

Source: Riabiz.com, August 2014

It's PPA Restatement Time! Wait, What's PPA Restatement?

Summary: Almost a decade ago, the IRS determined that all preapproved plans would have to be restated every six years. This would allow them to pull in all of the law changes in the previous six years and hopefully make the plans easier to read, administer, and review. As a result, all plans that use a preapproved plan document must be restated before April 30, 2016.

Source: Retirementtownhall.com, August 2014

In-Plan Retirement Income Solutions: Landscape Overview and Obstacles to Adoption

Summary: Paper discuss the dilemmas participants face as they prepare for retirement, especially in light of the void left by the diminished role of defined benefit plans. Then lays out the benefits, to both participants and plan sponsors, of an in-plan retirement income solution and discusses the significant barriers plan sponsors face in implementing such solutions, including an analysis of the most significant barrier -- the lack of clear regulatory guidance.

Source: Porteval.com , August 2014

How to Improve Your Employees' Retirement Security at Minimal Cost

Summary: To help retirees meet their financial needs prior to starting social security benefits, employers can educate their employees about the advantages of different spending and social security claiming patterns. Employers could also take this one step further by providing installment-payment features in their 401k plans. Such a feature might pay monthly or quarterly installments of fixed amounts for a set period to enable a retiree to replace the social security income he or she is deferring to optimize the benefit.

Source: Mercer.com , August 2014

Data Show Americans' Continued Commitment to Saving

Summary: ICI's latest study of retirement plan savers' actions, based on defined contribution plan recordkeeper data covering nearly 24 million employer-based DC plan participant accounts, shows Americans' continuing commitment to putting away money for retirement.

Source: Ici.org, August 2014

Employee Benefits: The Road Ahead

Summary: With major changes sweeping both health and retirement plans in the private sector, are employment-based benefits facing a "crisis" or merely an uncertain future? A recent industry-wide forum sponsored by the nonpartisan Employee Benefit Research Institute brought together a variety of experts to focus on the issue and the challenges ahead.

Source: Ebri.org , August 2014

Avoiding the Hardship of Correcting Hardship Distribution Violations

Summary: Administering hardship distributions correctly is important to prevent the hardship of completing a correction of an error in administration. Article reviews a few of the rules regarding: hardship definition, amount of the distribution, eligibility for a distribution, and backup needed and who is responsible for obtaining it. Also suggests a few actions to ensure that hardship distributions are processed accurately.

Source: Belfint.com, August 2014

Can Dabblers Exist in the DC Market?

Summary: Can dabblers survive in today's complicated DC world? While many experts think that advisors must specialize to do well in the 401k and related retirement plan markets, there's a lot of evidence that many advisors with plans under management do not specialize, nor do they intend to.

Source: Napa-net.org, August 2014

Be Diligent When Your Employer Terminates Your Company's Retirement Plan

Summary: A recent IRS private letter ruling showcased what can happen when a company retirement plan is terminated, and a common mistake that can occur when paying out those funds to employees or ex-employees.

Source: Theslottreport.com, August 2014

How Much is a Proper Beneficiary Designation Worth?

Summary: Naming and maintaining the appropriate beneficiary designation on your retirement accounts is an often overlooked yet crucial step. Doing it right can potentially save your beneficiaries thousands, if not hundreds of thousands of dollars. Article covers some important considerations regarding this decision.

Source: Clearygull.com, August 2014

Fidelity Settles Lawsuit With Own Employees Over 401k ERISA Allegations

Summary: Fidelity has settled two lawsuits filed last year by its own employees over allegations that they violated ERISA in the administration of their own 401k plan by charging excessive fees and committing prohibited transactions. Settlement agreement provides for $12 million to be paid to the class and for certain other affirmative relief to be taken.

Source: Fraplantools.com, August 2014

Why You May Not Need a Longevity Annuity in Your 401k

Summary: One of the biggest fears most retirees have is outliving their money. The DOL has approved the inclusion of annuities into 401k plans to help deal with this concern, but the articles author cautions against buying a "longevity annuity" that is sold by an insurance company.

Source: Forbes.com, August 2014

Report on the Economic Well-Being of U.S. Households in 2013

Summary: Many households in the United States have been tested by the Great Recession. Large-scale financial strain at the household level ultimately fed into broader economic challenges for the country, and the completion of the national recovery will ultimately be, in part, a reflection of the well-being of households and consumers. To better understand the financial state of U.S. households, the Federal Reserve Board conducted a new consumer survey, the results of which are described in this report.

Source: Federalreserve.gov , August 2014

Fed Report Paints Dreary Retirement for Some

Summary: Five years after the Great Recession, many Americans say they're still struggling to get by financially -- 19 percent of adults age 55 to 64 say they have no retirement savings or pensions to fall back on, according to a survey by the Federal Reserve.

Source: Aarp.org, August 2014

Litigators Call for Supreme Court Review of Tussey Case

Summary: A well-known 401k fee litigation firm has asked the U.S. Supreme Court to review key pieces of an appellate court's decision in Tussey v. ABB, Inc.

Source: Plansponsor.com, August 2014

Who Is in Charge Here? Will the Real 403(b) Plan Fiduciary Please Stand Up?

Summary: Distinguishing who the fiduciary is within a 403(b) plan or other qualified plan is an important determination. It is a highly confused, misinterpreted and somewhat gray area in the world of retirement plan compliance. Many plan sponsors wish to forgo all responsibility and risk related to their fiduciary roles in order to avoid liability and pitfalls and would gladly delegate the role to another third-party. If and how that can be done and some common application of the role of the fiduciary is the essence of this article.

Source: Ntsa-net.org, August 2014

The 401k Retirement Complex: Retooling Americans' Nest Egg

Summary: American workers need their employers to provide 401k plans that can help meet their retirement goals. They need their employers to help educate them to make good investment choices. Service providers also are vital to a well-functioning system. But Jerry Schlichter suggests that the 401k retirement complex also needs to retool itself so that it works primarily in the best interests of American savers. According to Schlichter, that is the real retirement crisis we face.

Source: Investmentnews.com (free registration may be required), August 2014

Do-it-Yourself Investor Behaviors and the Role of Plan Design

Summary: There are many things that can be done in plan design to address both saving and investing to help employees overcome potential obstacles they may be encountering, particularly those who take a "do-it-myself" approach to choosing their investments.

Source: Fidelity.com, August 2014

Less Pay, More Match -- Employees Say Yes

Summary: Many U.S. workers still view employer contributions, such as profit sharing or a 401k company match, as one of the most critical components of their retirement savings strategy, with many indicating they would prefer to have lower compensation in return for a higher employer contribution to their 401k.

Source: Fidelity.com, August 2014

31% of Americans Have No Retirement Savings At All

Summary: Nearly a third, or 31% of U.S. adults said they had no savings or pension to help them afford retirement, according to the Federal Reserve Board. Even more alarming: 19% of those very close to retirement age, between the ages of 55 and 64, said they had no savings. As a result, more than half of these respondents said they planned to either work full-time or part-time during their retirement years.

Source: Cnn.com, August 2014

Dudenhoeffer Ruling Benefits Both Sides, Attorneys Who Argued Case Agree

Summary: In a recent webinar sponsored by the Practising Law Institute, the attorneys who argued the case before the Supreme Court said that Dudenhoeffer contained victories for both fiduciaries of company stock plans and the employees who invest in those plans.

Source: Bna.com, August 2014

Zilch for Retirement

Summary: Whatever other goals they may have, people just aren't looking forward to retirement the way they used to -- even those who have already retired. That's what can be concluded from a survey conducted for the Federal Reserve for its report on economic well-being.

Source: Benefitspro.com, August 2014

ERISA Presumption of Prudence in 'Stock Drop' Cases Rejected

Summary: Justice Stephen Breyer's opinion for the court in Dudenhoeffer closes off "presumption of prudence" route: "In our view the law does not create a special presumption favoring ESOP fiduciaries. Rather, the same standard of prudence applies to all ERISA fiduciaries...except that an ESOP fiduciary is under no duty to diversify the ESOP's holdings." The court did, however, offer some concrete suggestions that may facilitate early dismissal of costly "stock drop" litigation.

Source: Newyorklawjournal.com, August 2014

IRS Updates 401k Plan Fix-It Guide

Summary: The Guide offers plan sponsors, administrators, and their advisors a helpful tool for identifying, addressing, and avoiding 401k compliance problems. Although it does not replace the authority of the EPCRS revenue procedure, the Guide provides a more user-friendly summary of the EPCRS correction methods.

Source: Ebia.com, August 2014

Guidance on Offering Longevity Annuities in DC Plans

Summary: On July 2, 2014, the IRS published final rules intended to make it easier for DC plans to offer lifetime income payment options to participants by removing the technical barrier to one of those options: longevity annuities. After summarizing the guidance, this article lists some preliminary observations as well as issues that interested employers might wish to consider.

Source: Sibson.com, August 2014

Accepting Rollover Contributions Now Easier - and Less Risky - for Retirement Plans

Summary: The administrative burden of determining the validity of rollover contributions to qualified retirement plans, and the associated risk of jeopardizing the plan's tax-qualified status, traditionally has been a significant headache for plan sponsors and administrators. The IRS now has provided a streamlined process for validating rollover contributions in the form of two safe harbors, one for rollovers from other employer qualified plans and another for rollovers from IRA's.

Source: Poynerspruill.com, August 2014

Fiduciary Responsibility for Investments a Serious Matter

Summary: Whether they are sensitive to their role as a fiduciary or not, 403(b) plan sponsors are required to take their responsibility seriously and to put their plan participants' interests first when considering the management of assets in retirement plans. Article offers a few things to watch for.

Source: Plansponsor.com, August 2014

Appellate Court Sends RJR Stock Drop Suit Back for Review

Summary: A lower court applied the wrong standard when determining that R.J. Reynolds Tobacco Company proved its fiduciary breach did not cause losses to retirement plan participants, an appellate court ruled.

Source: Planadviser.com, August 2014

States Take Auto IRA's Into Own Hands While Washington Dawdles

Summary: Retirement security is a top concern for states discussing options for workers whose companies don't offer plans. Maryland and Connecticut are the latest to launched efforts to develop policies to increase retirement savings among residents, taking on an issue that is languishing in Congress.

Source: Investmentnews.com (free registration may be required), August 2014

The Ultimate Plan Sponsor Checklist

Summary: While they don't have a book called Retirement Plan Sponsorship for Dummies, they should. So in the interim, here is a checklist that plan sponsors should review that can help them develop good practices and avoid unnecessary liability in their stewardship of retirement plans for their employees.

Source: Aktbenefitadvisors.com, August 2014

The "Gotchas" of Retirement Services Purchasing

Summary: The information gap that has existed between retirement services vendors and retirement plan sponsors has created fertile ground for "gotchas" in vendor service arrangements that continue to waste millions of dollars of retirement plan savings annually. This article explores the most common gotchas plan sponsors face and offers real-world solutions for those organizations seeking to improve their fiduciary supply chain management approach.

Source: Rolandcriss.com , August 2014

Roadmap to Retirement Readiness

Summary: Think your vendors have provided a roadmap for your participants' retirement readiness? Not so fast. The predominant "retirement readiness" model places control in the hands of the retirement plan's vendors, rather than the plan participants themselves. The good news: Attaining retirement readiness for your plan participants is just one simple step away.

Source: Rolandcriss.com , August 2014

How a Turnkey Open Architecture Approach Changes the Game for Plan Sponsors

Summary: Many retirement plan sponsors hire vendors that bundle several services, meaning that a single vendor wears multiple hats. But are bundled arrangements delivering enough value to offset the excessive fee risk that their programs present to both plan fiduciaries and plan participants? This article will explore the dangers inherent in traditionally bundled retirement plan services, and the amazingly similar approach that is redefining the fiduciary landscape.

Source: Rolandcriss.com , August 2014

Four Essential Skills for Retirement Plan Fiduciaries

Summary: This article will de-bunk the currents myths about fiduciary duty, delve into the four critical disciplines that plan sponsors need to know, and discuss best practice tips for excelling in each area as a retirement plan sponsor.

Source: Rolandcriss.com , August 2014

Lockheed Martin Retirement Plan Case Gets Trial Date

Summary: A long-fought legal battle between Lockheed Martin Corp. and a group of its retirement plan participants will finally go to trial in December after the plaintiffs were granted class action status.

Source: Investmentnews.com (free registration may be required), August 2014

Pushing the Employee-Savings Envelope With Auto-Escalation

Summary: While the concept of automatically escalating 401k paycheck deductions annually may sound unappetizing to some HR leaders because of the added costs they can incur, the results of a recent survey indicate employees may be ready to dig in.

Source: Hreonline.com, August 2014

Benefits Strategy and Benchmarking Survey Data Released

Summary: Benefits Strategy & Benchmarking Survey reveals that employers continue to see rising benefit costs in 2014. The survey examines how organizations are responding to healthcare reform and rising costs, as well as their approach to private exchanges, wellness and retirement programs, and other benefit trends and opportunities.

Source: Todaysfacilitymanager.com, August 2014

Target-Date Funds: No Happily Ever After in This Fairy Tale

Summary: That TDF managers are gathering assets may be good news for major mutual fund providers, but it doesn't seem so unequivocally positive for individual investors. Given the long-term demographic shift already in progress, according to the author, the popularity of TDFs may also have harmful social and economic consequences.

Source: Researchaffiliates.com, August 2014

Mistakes That 401k Plan Sponsors Should Avoid, But Do Anyway

Summary: This Ary Rosenbaum article is about common mistakes that plan sponsors commit in their role as plan fiduciaries, errors that increase their liability, but they still do it anyway.

Source: Jdsupra.com, August 2014

Report Finds Room for Improvement in Managed Accounts

Summary: Financial advisors and retirement plan sponsors abuzz about the increase in managed accounts, available to many 401k investors, may do well to tone down their excitement in the wake of a Government Accountability Office report that finds much room for improvement in how the accounts are structured.

Source: Insurancenewsnet.com, August 2014

To DB or Not to DB . . . That Is the Target-Date Question

Summary: Should target-date funds be more like DB pension plans? The argument for the DB-ization of TDFs is a poor one according to the author, when DC sponsors should consider risks, transparency, and other factors.

Source: Vanguardinstitutionalblog.com, August 2014

Process for Terminating Investment Managers Is Important

Summary: While much time is spent selecting investment managers, not nearly enough time is spent in establishing a processing for terminating such managers, says a recent paper from the Strategic Investment Group.

Source: Planadviser.com, August 2014

IRS Provides Guidance on Retirement Plan Terminations

Summary: In Employee Plans News, Issue 2014-11, August 4, 2014, the Internal Revenue Service provides guidance on retirement plan terminations, including partial terminations.

Source: Irs.gov , August 2014

Unconventional Wisdom on Retirement Preparedness

Summary: How well are Americans planning and saving for retirement? This is an important question to answer, but also vexingly difficult. Researchers have come to different conclusions. Much of the academic research and ICI's own analysis of the data indicate that, contrary to conventional wisdom, most Americans are properly preparing for retirement.

Source: Ici.org, August 2014

Smaller 401k's Outperform Bigger Plans

Summary: Bigger isn't always better when it comes to 401k plan performance. In fact, it's the smallest plans that are setting the pace, according to an analysis by Judy Diamond Associates, publisher of retirement plan data.

Source: Benefitspro.com, August 2014

Amnesty Program for Small Plan 5500 Filings

Summary: Civil penalties of up to $1,025 per day up to a maximum of $15,000 may be imposed on companies who fail to file their annual Form 5500 filing by its due date. Luckily there are programs available to be able to submit filings late with a significantly-reduced late filing penalty fee.

Source: Benefit-Resources.com, August 2014

Solving Technology Challenges With IT Outsourcing for Retirement Administrators

Summary: IT outsourcing can provide them with the opportunity to take advantage of advanced, modern recordkeeping applications within a high-performance IT infrastructure while outsourcing the implementation and maintenance of these systems. At the same time, providers can leverage global data centers to host their software and IT systems in a secure, compliant, and accessible environment while controlling everyday recordkeeping operations. Some of the benefits of IT outsourcing are reviewed here.

Source: 401khelpcenter.com, August 2014

Navigating the Minefield of Fiduciary Liability as a 401k Plan Sponsor

Summary: The failure to fully execute the fiduciary duties ERISA imposes upon 401k plan employers and administrators can lead to significant liability exposure. This article will help plan sponsors navigate the minefield of fiduciary liability including reviewing the litigation risk and suggesting some best practices. As the author suggests, "This is no place for amateurs."

Source: 401khelpcenter.com, August 2014

Mitigating Longevity Risk in DC Plans

Summary: DC plan participants face the risk of outliving retirement assets. However, earlier this month, the IRS issued final regulations that make it easier for 401k plans, individual retirement accounts and other retirement programs to invest in certain annuity contracts that could help mitigate this risk. Article discusses how these regulations will affect 401k's and IRA's.

Source: Jdsupra.com, August 2014

The Active Versus Passive Debate Continues

Summary: The research shows that the market environment can have a greater impact on relative performance than manager skill or even cost differences, and that during periods of significant performance deviation between opposing market segments, there can be pronounced differences in active performance relative to the market.

Source: Vanguard.com , August 2014

PBGC Coverage May No Longer Apply to Puerto Rico-Only Qualified Retirement Plans

Summary: Employers that sponsor defined benefit qualified retirement plans benefiting only Puerto Rico employees should be aware that Pension Benefit Guaranty Corporation (PBGC) coverage may no longer apply.

Source: Mwe.com, August 2014

What a CPA's Plan Audit Does Not Cover -- You'd Be Surprised

Summary: What may be a revelation and a bit scary is the extent to which many plan sponsors misunderstand the IQPA's purpose. Many believe the IQPA is more comprehensive than it actually is. Consequently they falsely rely on report as a determiner of the adequacy administrative and fiduciary governance. What they need is another type of review for this purpose.

Source: Fiduciaryplangovernance.com, August 2014

Time to Restate 401k Prototype and Volume Submitter Plans

Summary: In Announcement 2014-16, the IRS announced the opening of the PPA restatement window for defined contribution, including 401k, prototype and volume submitter plan documents. The PPA restatement documents must be adopted by April 30, 2016. Failure to complete the restatement by the April 30, 2016 deadline will jeopardize a plan's tax-qualified status. The IRS also announced that it will begin to accept individual determination letter applications for the PPA restatement documents from May 1, 2014, through April 30, 2016.

Source: Truckerhuss.com, August 2014

"Robin Hood" of Fees Takes Aim at 401k's

Summary: Those worried about hidden fees in their retirement accounts might want to investigate FeeX, a service that was launched in the U.S. this spring. Free at the moment, eventually the company plans to introduce optional premium services for which it will charge.

Source: Thinkadvisor.com, August 2014

Transatlantic DC Participant Survey 2014

Summary: While the regulatory environment governing retirement plans can vary greatly among different countries, plan sponsors in Ireland, the United Kingdom and the United States often face similar challenges. Regardless of geography, almost all plan sponsors have an opportunity to do more. This survey shows that plan sponsors can improve retirement readiness by helping participants increase their savings, providing more financial education to workers and retirees, and designing retirement vehicles that are easy to understand and access.

Source: Ssga.com , August 2014

Do You Protect Against Vendor Conflicts of Interest?

Summary: Hidden vendor conflicts of interest can result in higher fees and unforeseen costs for the plan sponsor and plan participants, so having a system in place to uncover potential conflicts is paramount.

Source: Rolandcriss.com, August 2014

Can the Enrollment Experience Improve Participant Outcomes?

Summary: Although automatic enrollment has been a boon for plan participation and encourages steady savings habits, more needs to be done. Automatic enrollment may not be a universal answer. Fidelity embarked on extensive employee research and testing to determine if a simplified, streamlined enrollment process could improve participation outcomes. This 12 page paper reviews the results.

Source: Fidelity.com , August 2014

Video: Establishing Written Daily Tasks

Summary: Watch this video to learn one, sure-fire way to have constant improvement for your Employee Benefit Plan's operations.

Source: Erisasunscreen.com, August 2014

GAO to Look at TDFs, Other QDIAs

Summary: Following up on its calls for stricter oversight of managed account providers to 401k plans, the Government Accountability Office is undertaking a review of qualified default investment alternatives in 401k plans.

Source: Benefitspro.com, August 2014

PPA Document Restatement Fees Survey Result

Summary: A total of 57 TPA business owners or managers responded to this survey, conducted online from late June through mid-July. Nearly half of all respondent firms report serving >500 plans; the average was 650. Article reviews the survey results.

Source: Tparesources.com, August 2014

Investment Policy Statements

Summary: An investment policy statement defines the processes that a company has adopted to make investment-related decisions with respect to the assets of an ERISA 403(b) and 401k plan. While the law does not require that a plan adopt an IPS, it may be the single most important task that a fiduciary performs. Here's an overview of how to construct one.

Source: Strategicbenefitservices.com, August 2014

New Requirements for Delinquent Retirement Plan Form 5500 Filers

Summary: The IRS recently issued Notice 2014-35, which provides that Form 5500s filed under the Department of Labor's Delinquent Filer Voluntary Compliance program since January 1, 2010 can file a late Form 8955-SSA without a penalty. Therefore, if an employer has failed to submit its paper Form 8955-SSA as required, now is the time to send it in.

Source: Sgrlaw.com, August 2014

DC Plans Work When Backed by Social Security

Summary: A new study of brand-new retirees with such plans finds they are, indeed, faring well, but only thanks to an additional big lift from Social Security income and a willingness to economize.

Source: Onwallstreet.com, August 2014

Plan Language and Administration Can Clarify Beneficiary Designation Issues

Summary: Determining the beneficiary of a qualified retirement plan after a participant's death has legal ramifications. Plan sponsors should ensure that a plan's benefit distribution language and plan administration meet federal requirements.

Source: Milliman.com, August 2014

Changing Employee Benefit Plan Vendors? Tips for a Smooth Transition

Summary: Regardless of the reason you seek to change your plan's recordkeeper, trustee, or custodian, you face an increased risk of error if the change isn't managed properly. As a result, if you're debating a change in vendors for your benefit plan, it's important to consider the potential risks to both the plan and its participants.

Source: Mossadams.com, August 2014

ERISA's Service Provider Disclosure Rules and How to Comply With Them

Summary: If you're an employee benefit plan fiduciary, you're likely familiar with ERISA Section 408(b)(2). These regulations, which became effective in 2012, address what most of us know as service provider disclosures. So what steps can you take to fulfill your duties and avoid penalties? Here are four best practices that can help you demonstrate compliance.

Source: Mossadams.com, August 2014

Safe Harbor 401k Establishment Deadlines 2014

Summary: Although the greatest burden imposed on a plan sponsor who elects a safe harbor 401k plan design feature is usually perceived to be the funding of the safe harbor contribution, there are many other administrative requirements that must be satisfied in order to qualify for the ADP / ACP exemption. One such requirement relates to the plan year of a safe harbor 401k plan.

Source: Legacyrsllc.com, August 2014

What Does Consistent Participation in 401k Plans Generate?

Summary: At year-end 2012, the average account balance among consistent participants was 67 percent higher than the average account balance among all participants in the EBRI/ICI 401k database. The consistent group's median balance was almost three times the median balance across all participants at year-end 2012.

Source: Ebri.org , August 2014

The New 401k Plan Annuity Option

Summary: More than two years after soliciting comments, the Treasury Department issued final regulations making available the opportunity for retirement plan participants to purchase Qualified Longevity Annuity Contracts inside retirement plans. Some of the key provisions necessary for an annuity to qualify as a QLAC under the regulations are reviewed here.

Source: Ascende.com, August 2014


Looking for earlier information? Go to our Archive.

401khelpcenter.com, LLC is not the author of the material referenced in this digest unless specifically noted. The material referenced was created, published, maintained, or otherwise posted by institutions or organizations independent of 401khelpcenter.com, LLC. 401khelpcenter.com, LLC does not endorse, approve, certify, or control this material and does not guarantee or assume responsibility for the accuracy, completeness, efficacy, or timeliness of the material. Use of any information obtained from this material is voluntary, and reliance on it should only be undertaken after an independent review of its accuracy, completeness, efficacy, and timeliness. Reference to any specific commercial product, process, or service by trade name, trademark, service mark, manufacturer, or otherwise does not constitute or imply endorsement, recommendation, or favoring by 401khelpcenter.com, LLC.

 


Press Center | Glossary | Privacy Policy | Terms of Use | Contact Us

Creative Commons License
This work is licensed under a Creative Commons Attribution-NoDerivatives 4.0 International License.