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May 2017 Digest

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.

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Who Killed Retirement Security? If You Look Closely, It Wasn't the 401k

Abstract: Private retirement savings are at record levels, and the uptick in saving began at precisely the time when 401ks began to replace traditional pensions. By far the biggest risk to retirement security is underfunded government retirement plans, which have promised vastly greater benefits than they can pay.

Source: Thehill.com, May 2017

How to Make Your 401k Loan Program State-of-the-Art

Abstract: A significant factor in helping your 401k plan participants achieve retirement readiness is protecting them from themselves. In other words, helping participants avoid making bad decisions. An important component of that process is minimizing the loss of participant account balances from loan defaults.

Source: Lawtonrpc.com, May 2017

IRS Relieves Some of the Hardship of Hardship Distributions

Abstract: The new guidelines provide some flexibility to employers and plan administrators by allowing them to rely on summaries rather than requiring actual source documents in all cases. However, while employers and plan administrators often are reluctant to impose additional burdens on individuals who are experiencing financial difficulties, it is clear that self-certification of a hardship, without the necessary information and/or source documents, will not suffice and will result in a plan failure.

Source: Foxrothschild.com, May 2017

Pension Ages Simply Must Rise as We All Live Longer

Abstract: The retirement age should rise to at least 70 in rich countries by 2050 as life expectancy rises above 100, according to a new report. The World Economic Forum said that employees should continue working until 70 in nations such as the UK, US, Japan and Canada. There's a reasonable argument that it should rise very much more than that.

Source: Forbes.com, May 2017

ERISA's Fiduciary Rule -- Not Dead Yet, Not Dead ... Ever?

Abstract: It has been a long and winding road for the amended fiduciary regulation. The DOL has now made clear that the Regulation will be going into effect in part on June 9, as discussed in this article.

Source: Dechert.com, May 2017

Update on the DOL's Fiduciary Rule

Abstract: Assuming that the fiduciary rule and the revised prohibited transaction exemptions will survive in some form, plan sponsors (and other plan fiduciaries) that have not already done so should undertake an assessment of the investment education and investment advice services provided to the plan, to plan fiduciaries and to plan participants. To the extent service providers are providing more than general investment education, the parties should be making good faith efforts to modify the service arrangements, as necessary, to comply with the new and revised rules.

Source: Bsk.com, May 2017

Wells Fargo Scores Rare Win in 401k Fee Litigation Series

Abstract: Wells Fargo & Co. defeated a proposed class action claiming the company stuffed its $35 billion 401k plan full of expensive and poorly performing target-date funds affiliated with the company.

Source: Bna.com (registration may be required), May 2017

DOL Announces No Claims Against Fiduciaries During Phased Implementation Period

Abstract: DOL Issues FAB 2017-02 Announcing that the DOL will not pursue claims against fiduciaries working in good faith to comply with the fiduciary investment advice regulation and the related prohibited transaction exemptions before January 1, 2018.

Source: Westlaw.com, May 2017

Fiduciary Rule: Some Conflict, Lots of Interest

Abstract: Now that the new DOL secretary, Alexander Acosta, has announced that the DOL will not be seeking a further delay of the applicability date of the fiduciary rule and will be focusing its efforts on the examination, attention is shifting to the institution comment letters. What did they urge the DOL to do with its examination? This article summarizes the institution comment letters and offers a few observations regarding key issues and concerns.

Source: Sutherland.com, May 2017

Five Best Practices for Investment Committees

Abstract: Maintaining an institutional investment program, including the oversight and responsibilities of acting as fiduciary, can be daunting to even the most seasoned investment committees. With so much involved in managing an investment portfolio, it's easy for committees to get lost in the details and lose sight of the big picture. The most successful investment committees support their organizations by using five best practices.

Source: Plantemoran.com, May 2017

Another Bundled 401k Provider Sued by Employees

Abstract: T. Rowe Price has become the latest bundled 401k provider accused of self-dealing in their 401k plan. A former employee has accused the Maryland based money manager of offering expensive, retail share classes to their plan participant/employees when other, less expensive share classes existed.

Source: Nwp401k.com, May 2017

Alignment of Wealth and Health...The 401k and HSA

Abstract: One recent trend that is getting a significant amount of attention is the alignment of wealth and health - specifically 401k Plans and HSAs. How does this impact the role and opportunity for financial advisers?

Source: Lifetimebenefitsolutions.com, May 2017

Win the Battle, Lose the War? The Fiduciary Rule Moves Forward

Abstract: The DOL has confirmed that the initial June 9 compliance date for the Fiduciary Rule will not be postponed. Secretary Acosta reportedly shares the Trump administration's position regarding the Rule, so it would be wrong to read this as anything other than a short-term victory for the Rule's supporters. So, what happens on June 9?

Source: Cohenbuckmann.com, May 2017

Princeton Joins List of Schools Sued Over Retirement Plans

Abstract: Princeton University is the latest college to be hit with a proposed class action challenging the fees and investment options offered through the school's retirement plans.

Source: Bna.com (registration may be required), May 2017

Are You Computing Your Maximum Participant Loan Amount Correctly?

Abstract: The IRS issued a Memorandum providing two alternatives for computing the maximum participant loan amount when the participant has prior loans. Prior to this Memorandum, the law was not clear concerning how to compute the maximum loan amount where a participant had taken a previous loan during the year.

Source: Benefitslawadvisor.com, May 2017

What Expenses Can Be Paid From a 401k Plan?

Abstract: From a regulatory standpoint, it is legal for the Plan to pay eligible expenses (such as 401k audit fees, investment advisor charges, TPA fees, etc.) if the Plan has been properly structured and doesn't contain language which would expressly forbid.

Source: 5500audit.com, May 2017

Agency Predicts $224 Trillion Retirement Gap (Seriously)

Abstract: The World Economic Forum's predicts a coming retirement funding shortfall of an eye-popping $224 trillion deficit by 2050 in the world's largest pension systems. The obvious inference is that demographic changes in longevity mean defined benefits can no longer get it done, and it makes the case (again) for 401k-style defined contribution plans.

Source: 401kspecialistmag.com, May 2017

DOL's Fiduciary Rule Improves Target-Date Funds

Abstract: The DOL Fiduciary Rule goes into effect June 9, 2017, despite expectations of a cancellation. Most believe the Rule is for the retail investor, but it will also help target-date fund beneficiaries immensely. This article discusses the four TDF fiduciary practices that will need to improve to meet the Best Interest Standards.

Source: Seekingalpha.com, May 2017

Acosta's DOL Approach to the Fiduciary Rule

Abstract: In an op-ed in the Wall Street Journal, Secretary Acosta announced that the DOL will not delay the June 9, 2017 Applicability Date of the new fiduciary rule. Secretary Acosta wrote that, "The fiduciary rule as written may not align with President Trump's deregulatory goals." However, DOL concluded there was "no principled legal basis to change the June 9 date."

Source: Groom.com, May 2017

DOL's New Fiduciary Rule Will Go Into Effect June 9th

Abstract: The DOL has announced that the new fiduciary conflict of interest rule and related exemptions will begin taking effect on June 9, 2017, ending speculation of further delay. At the same time, the Department announced a relaxed enforcement standard for the rest of 2017.

Source: Erisapracticecenter.com, May 2017

401k Service Providers and Cybersecurity: Questions to Ask (Updated)

Abstract: 401k plan fiduciaries have an obligation to secure and keep private the personally identifiable information of plan participants and beneficiaries. Part of this essential task is ensuring that plan service providers take cybersecurity preparedness and plan data protection seriously.

Source: 401khelpcenter.com, May 2017

Duty, Opportunity, Mastery: Investment Committee Best Practices

Abstract: The purpose of this 21-page paper is to provide investment committee members with practical guidance on meeting their fiduciary responsibility through proper debate and documentation, constructing their committee thoughtfully with well-vetted leaders and members with diverse skills and backgrounds, conducting well-structured and productive meetings, and anticipating and resisting counterproductive behaviors.

Source: Vanguard.com, May 2017

2017 TIAA Transition to Retirement Survey

Abstract: The survey offers new insights into people who are on the verge of retirement. Many are making plans for where they will live and travel, and what they will do with their time. At the same time, they are looking at how they will pay for their life in retirement.

Source: Tiaa.org, May 2017

SEC Issues Ransomware Risk Alert Highlighting Cybersecurity Best Practices

Abstract: The SEC published a Risk Alert regarding the "WannaCry" ransomware worm that infected hundreds of thousands of computers in over 150 nations earlier this month. The Alert provides background and resources and additionally highlighted cybersecurity best practices.

Source: Sutherland.com, May 2017

Treatment of "Collateral" Employees Under Retirement Plans

Abstract: It is common for employers to contract with one or more third parties to provide individuals to perform services for the employer. Various issues may arise regarding the treatment of such individuals under a retirement plan maintained by the employer.

Source: Spencerfane.com, May 2017

How to Not Be a Low Hanging Fruit for Litigation Attorneys

Abstract: On June 9, anyone advising on retirement assets (including rollovers) effectively becomes an ERISA fiduciary, subject to one of the strictest legal standards every devised. If you are without a documented prudent process, you could become the low hanging fruit for litigation attorneys.

Source: Rixtrema.com, May 2017

Millennials Are Investing Less and Saving More Than Previous Generations

Abstract: Millennials are investing less and handling finances more conservatively than previous generations, according to a recent Revere Bank study. The study surveyed millennials aged 18-39 on their financial habits and future financial preparations.

Source: Prnewswire.com, May 2017

People With Student Loans Have Trouble Saving for Retirement

Abstract: A crushing load of student debt is preventing young people from saving for retirement, buying a home or even deciding to start a family, Prudential Financial found in a survey of 2,369 people last September.

Source: Plansponsor.com, May 2017

Reimbursement of Sponsor Expenses

Abstract: Some plan sponsors bill their plans for the services the sponsor provides to them. That practice -- while permitted under certain circumstances -- does present certain issues under ERISA. This article briefly reviews the rules under which a sponsor/fiduciary may be reimbursed for expenses, some of the pitfalls those rules present, and some recent litigation on the issue.

Source: Octoberthree.com, May 2017

Knowing How to Satisfy the Best Interest Standard

Abstract: The new transition exemptions soon will apply to recommendations for IRAs. Fred Reish looks at how to prepare for that shift.

Source: Ntsa-net.org, May 2017

Acosta Declines to Extend Delay of DOL Fiduciary Rule

Abstract: Labor Secretary Alexander Acosta confirmed Monday night that the agency's fiduciary rule will become applicable on June 9. His decision is a victory for supporters of the rule.

Source: Investmentnews.com (registration may be required), May 2017

The Time is Right to Contact Recordkeepers About Hardship Substantiation

Abstract: The IRS recently issued an internal memorandum providing guidance to its employee plans examination group on the substantiation requirements for hardship distributions from a section 401k plan. If your 401k plan recordkeeper has not talked to your company lately about hardship distributions documentation, it may be time to reach out to the recordkeeper.

Source: Erisapracticecenter.com, May 2017

DOL's Conflict of Interest FAQ (Transition Period)

Abstract: This 11-page FAQ was just released by the DOL and provides additional information on the transition period from June 9, 2017 to January 1, 2018. This guidance, like the Fiduciary Rule and related exemptions, is generally limited to advice concerning investments in IRAs, ERISA-covered plans, and other plans covered by section 4975 of the Internal Revenue Code.

Source: Dol.gov, May 2017

DOL's Fiduciary Rule Enforcement: Field Assistance Bulletin No. 2017-02

Abstract: This document announces a temporary enforcement policy related to the DOL's final rule defining who is a fiduciary under ERISA and the Internal Revenue Code, and the related prohibited transaction exemptions, including the Best Interest Contract Exemption, the Class Exemption for Principal Transactions In Certain Assets Between Investment Advice Fiduciaries and Employee Benefit Plans and IRAs, and certain amended prohibited transaction exemptions.

Source: Dol.gov, May 2017

Fiduciary Update

Abstract: This article provides an update on the DOL's conflict of interest rule expansion and compliance, deathbed beneficiary changes, required minimum distribution, and other fee related litigation.

Source: Captrustadvisors.com, May 2017

The DOL Will Not Delay Fiduciary Rule

Abstract: Labor Secretary, Alexander Acosta, threw in the towel in his effort to delay the application date of the Fiduciary Rule. Barring any additional developments, the Rule will now become applicable, as scheduled, on June 9, though certain provisions do not become applicable until January, 2018.

Source: Cammackretirement.com, May 2017

Transforming the Participant Experience

Abstract: Retirement communications have reached a tipping point and leading plan providers are looking to embrace a new path. They see converging trends: changing workplace demographics, technological innovations, evolving participant demands, increasing margin pressure, low savings rates, and added regulatory scrutiny. Any one of these trends would be challenging to manage. Taken together, they require fresh perspectives to find opportunities.

Source: Broadridge.com, May 2017

University of Chicago Latest College Hit With Retirement Plan Suit

Abstract: The University of Chicago is accused in a new lawsuit of carrying high fees and offering a poor selection of investment funds in its two retirement plans ( Daugherty v. The University of Chicago).

Source: Bna.com (registration may be required), May 2017

Short-Term Financial Considerations Prioritized Over Retirement Savings

Abstract: The lack of retirement savings could in part be due to prioritizing short-term financial considerations. Americans report they are more concerned about affording unexpected expenses (44%), health care costs (41%) and taking desired vacations (36%) than they are about having adequate retirement savings (32%).

Source: Plansponsor.com, May 2017

California Says It Doesn't Need Safe Harbor for State-Run Auto IRA Program

Abstract: President Trump may have signed legislation pulling back the Obama administration's ERISA safe harbor guidance for state-run auto IRAs, but California officials say they don't need it. In a press release, California State Treasurer John Chiang and Senate President Pro Tempore Kevin de Len said that California's Secure Choice program remains on track, and they have a legal opinion backing them up.

Source: Ntsa-net.org, May 2017

New IRS Guidance Allows Plan Sponsors to Use Forfeitures for Safe Harbor Contributions, QNECs and QMACs

Abstract: Earlier this year, the IRS released proposed regulations which permit employers to use forfeitures to fund safe harbor contributions, QNECs and QMACs.

Source: Mwe.com, May 2017

Alignment of Wealth and Health ... The HSA and 401k

Abstract: A recent trend that is getting a significant amount of attention is the alignment of wealth and health. Specifically 401k Plans and HSAs and how this impacts the role and opportunity for financial advisers.

Source: Lifetimebenefitsolutions.com, May 2017

How 401k Advisers Can Create Effective Financial Wellness Programs

Abstract: For all the buzz employer financial wellness programs are receiving, they may be short-lived. When our team at Duke University's Common Cents Lab evaluates financial wellness programs, we focus on one key area: Is the program using proven methods to change behavior? Sadly, most financial wellness programs get a very low score.

Source: Investmentnews.com (registration may be required), May 2017

What Plan Sponsors Look for in a 401k Adviser

Abstract: A recent survey of plan sponsors found 53% are satisfied with their adviser and 55% are satisfied with the value they receive. But experts say sponsors now want even greater value, which can take the form of lower costs, more services or, typically, a combination of both.

Source: Investmentnews.com (registration may be required), May 2017

Advisers Struggle to Get 401k Plan, Participant Data From Recordkeepers

Abstract: There is a fight brewing between DC recordkeepers and advisers over access to plan and participant data which could determine the fate of retirement security for Americans. Without access to plan and participant data, advisers, broker-dealers and RIAs will have limited ability to help workers in DC plans maximize retirement savings.

Source: Investmentnews.com (registration may be required), May 2017

The Participant Disclosure Regulation: A Guide for Plan Sponsors

Abstract: The DOL's Participant Disclosure Regulation imposes an entirely new disclosure regime on plan administrators, which is intended to provide participants with information to assist them in making informed decisions regarding the management of their plan account. You should consider these requirements on a continual basis, as well as when changes to your plan are contemplated, to ensure you are complying with the Regulation.

Source: Fidelity.com, May 2017

The Effect of Rising Rates on Stable Value Accounts

Abstract: These lower-risk accounts can be a smart choice for the conservative fixed income portion of a portfolio, as they avoid the losses likely to hit bond funds, while delivering higher returns than money market funds. These accounts are specifically designed to protect principal in DC plans, regardless of interest rate fluctuation.

Source: Cammackretirement.com, May 2017

Retirement Benefits and Divorce, Top Tax Issues

Abstract: If a couple has a joint investment in a retirement plan the plan account can be divided to give each spouse their fair share. To divide the plan account without either spouse incurring a massive penalty for early withdrawal from the account, the couple will need to have a Qualified Domestic Relations Order (QDRO) prepared.

Source: Bsllp.com, May 2017

IRS Spells Out Two Available Plan Loan Computations

Abstract: The IRS clarified the two ways DC plans can calculate maximum participant loan amounts in a memo that should bring some relief to plan sponsors and administrators.

Source: Blr.com, May 2017

Open MEPs, Fiduciary Delay Dominate Hearing

Abstract: A congressional hearing on "Regulatory Barriers Facing Workers and Families Saving for Retirement" ran the gamut from the fiduciary regulation to multiple employer plans to state-run programs. The hearing, by the House Education and Workforce Committee's Subcommittee on Health, Employment, Labor & Pensions, heard from four witnesses on a handful of retirement topics, and in the process showcased that partisan differences have only calcified in the 115th Congress.

Source: Asppa.org, May 2017

Which of the Three 401k and 403(b) Service Models Is Right for Your Plan?

Abstract: To most outsiders, the defined contribution market appears confusing and complicated. But there are just three service models for 401k and 403b plans to choose from. This article reviews the different models and which might be best for your plan.

Source: 401ktv.com, May 2017

State Auto IRA Plans Moving Forward Despite Loss of ERISA Exemption

Abstract: Even though state auto-IRA plans will not be exempted from ERISA as Congress moved to rescind the protection granted by the DOL in August 2016, it appears that states are still planning to move forward.

Source: 401ktv.com, May 2017

Defying Trump, Another State Passes Retirement Plan

Abstract: Forget what Trump says, individual states are plowing forward with their own retirement plans meant to cover workers who lack access from private-sector employers. Vermont is the latest to pass a bill securing a state-sponsored public option for small businesses.

Source: 401kspecialistmag.com, May 2017

Trends in the Expenses and Fees of Funds, 2016

Abstract: On average, expense ratios for long-term mutual funds have declined substantially over the past 20 years. In 1996, equity mutual fund expense ratios averaged 1.04 percent, falling to 0.63 percent in 2016. Bond mutual fund expense ratios averaged 0.84 percent in 1996 compared with 0.51 percent in 2016. Hybrid mutual fund expense ratios averaged 0.95 percent in 1996, falling to 0.74 percent in 2016.

Source: Ici.org, May 2017

Managed Account Use Poised to Jump in 401k Plans

Abstract: Mergers of 401k recordkeepers, such as the combination of Great-West Financial, Putnam Investments and J.P. Morgan Retirement Plan Services into Empower Retirement, are part of the equation that's driving an increase in the number of employers offering managed accounts in their plans.

Source: Bna.com (registration may be required), May 2017

Update on University Section 403(b) Cases: Inconsistent Rulings

Abstract: A novel theory proceeding in both the Duke and Emory cases is the claim that the defendants were imprudent to hire multiple recordkeepers, where consolidating services with one recordkeeper could have resulted in lower fees for participants.

Source: Benefitslawadvisor.com, May 2017

Financial CHOICE Act Passes House Financial Services Committee

Abstract: The House Financial Services Committee passed the Financial CHOICE Act of 2017 (H.R. 10), which would make significant financial regulatory changes including the repeal or replacement of certain key provisions of the Dodd-Frank Act. It would also eliminate DOL's fiduciary duty rule and require the SEC to promulgate its own fiduciary duty rule.

Source: Westlaw.com, May 2017

Heeding the Call of (Fiduciary) Duty

Abstract: Sometimes the "basics" get so shopworn they lose their punch, like the solemn performance of fiduciary duty and its importance to every retirement plan sponsor and nonprofit institution and their investment committees. This is a brief refresher.

Source: Vanguardinstitutionalblog.com, May 2017

Perspective on Annuities for Accumulation in DC Plans

Abstract: If an investor's expected Social Security and defined benefit income will not offer sufficient longevity protection, partially annuitizing retirement assets might help. However, using annuities to accumulate income in defined contribution plans could have drawbacks, including higher costs and limited flexibility and liquidity relative to mutual funds and other investments.

Source: Vanguard.com, May 2017

A Forgotten Part of Participant Financial Wellness: Loan Defaults

Abstract: With all the industry focus on financial wellness, it begs the question. Why do plans ignore an ongoing source of retirement plan leakage: defined contribution plan loan defaults?

Source: Plansponsor.com, May 2017

Fiduciary Rule Debate Impacts State-Run Plans for Private Sector

Abstract: A new bill introduced by Senate Democrats, seeking to protect ERISA exemptions for state- and city-run retirement plans for the private sector, would likely be made redundant with the removal of the Obama-era fiduciary rules.

Source: Planadviser.com, May 2017

Take Action: Five Ideas for DC Plan Sponsors

Abstract: Last year was full of surprises and the macroeconomic trends seem likely to continue in 2017. This article suggests five investment themes to guide plan sponsors in navigating the challenges ahead.

Source: Pimco.com, May 2017

How 401k Plan Design Can Increase Retirement Savings

Abstract: You can and should assist participants by providing them with a good investment menu and by adopting plan features that help participants save. Here are eight suggestions for how to provide even those who aren't applying the lessons of the education program with support to accumulate an adequate 401k account.

Source: Penchecks.com, May 2017

Listen to Your Participants: Don't White Label 401k Investment Funds

Abstract: The author writes, "Plan sponsors, if you would like to frustrate, annoy and confuse your 401k plan participants, then 'white label' your 401k plan investment funds."

Source: Lawtonrpc.com, May 2017

Courts' Interpretations of 401k Fiduciary Laws Are Changing

Abstract: It appears that laws of fiduciary prudence under ERISA are evolving. A recent district court decision, in Lorenz v. Safeway, demonstrates this point. The prudence requirement in being gauged based on the portfolio in aggregate but also on individual investment options.

Source: Investmentnews.com (registration may be required), May 2017

Fidelity's Approach to DOL Fiduciary Rule Rankles Some 401k Advisers

Abstract: Their ire stems from changes that Fidelity is making to its business in relation to compliance with the DOL's fiduciary rule. Fidelity is taking on fiduciary responsibility for both plan-level and participant-level advice in some DC plans, which itself may not seem out of the ordinary since the conflict-of-interest regulation is creating a massive shift in the way retirement plan providers operate. The way Fidelity is going about it, though, is where there's tension.

Source: Investmentnews.com (registration may be required), May 2017

Acquisition or Merger? Don't Overlook the Seller's 401k Plan

Abstract: If you're a business considering the purchase of another company, the last aspect of the deal you're probably considering is the seller's 401k plan. However, it's important for you to have a strategy for that plan in place before your deal is closed. Otherwise, you could be stuck with a 401k plan that includes costly protected benefits or uncorrected defects.

Source: Employeefiduciary.com, May 2017

Lawsuit Rulings Provide Hope for Plan Sponsors

Abstract: A recent ruling in Brotherston et al v. Putnam Investments is significant because many DC plan lawsuits that have been filed against the fiduciaries of retirement plans have included Vanguard as the standard by which the fees of the investments in question have been compared. By acknowledging the difference in both the type of investment, active versus passive, and the model used by the investment provider, the District Court's opinion should be helpful to the defendants in these lawsuits.

Source: Cammackretirement.com, May 2017

DOL Throws New Lifeline to Lifetime-Income Solutions

Abstract: An advisory opinion published by the DOL in late December 2016 is a big step forward by the government: it embraces a more holistic outlook on retirement-savings issues.

Source: Abglobal.com, May 2017

Simple Standard to Evaluate 401k and 403b Plan Advisors -- ELI Rating

Abstract: It's hard for many 401k or 403(b) plan sponsors to determine whether their plan advisor is doing a good job, just as it is difficult to find a new one. Along with the right experience and training, defined contribution sponsors need to determine if the advisor is the right fit. To do so, plan sponsors can deploy a simple, common sense standard called the ELI rating.

Source: 401ktv.com, May 2017

Dangerous Flexibility -- Retirement Reforms Reconsidered

Abstract: Flexible retirement is supposed to increase labor supply of older workers without touching the third rail of pension politics, the highly unpopular increase of the retirement age. While this may have intuitive appeal, this paper shows that it might be wishful thinking. Economic theory tells us that flexible retirement policies can have a zero or positive effect on labor force participation while the effect on hours worked can be positive or negative depending on the distribution of leisure preferences. Thus, the overall effect is ex ante unclear.

Source: Ssrn.com, May 2017

Your Retirement Plan: Set It, But Don't Forget It

Abstract: When it comes to planning for retirement, there are three commonly automated arrangements that warrant a one-off, stop-and-think review from time to time: beneficiary designations, plan participation, and investment allocation.

Source: Letsmakeaplan.org, May 2017

Five Time-Tested Tactics to Save for Retirement

Abstract: Kiplinger's Personal Finance distilled their best advice on how to build, protect and enhance your wealth throughout your life starting with these tips to save more for retirement.

Source: Kiplinger.com, May 2017

Small 401k Plans Have Bigger Problems Than Larger Plans

Abstract: Thanks to the quirks of the retirement plan business and how it prices products and services, it's the smaller plans that will have larger problems in terms of compliance and cost. This article is all about letting small 401k plan sponsors learn why they can't ignore their role as a plan fiduciary.

Source: Jdsupra.com, May 2017

TIAA to Pay $5M in 401k Excessive-Fee Suit

Abstract: TIAA agreed to pay $5 million to settle a lawsuit alleging the firm breached its fiduciary responsibilities in two retirement plans it provides to its employees.

Source: Investmentnews.com (registration may be required), May 2017

Podcast: Health Savings Accounts in the Fiduciary Process

Abstract: While the direction of health care is nearly impossible to predict, the rise in health savings accounts appears to be inevitable. And under the DOL fiduciary rule, advice on these accounts will be considered a fiduciary act. In this podcast, Blaine Aikin and Duane Thompson discuss HSAs and what advisors need to know when considering these accounts for their clients.

Source: Fi360.com, May 2017

Free Guide: "The Intelligent Fiduciary"

Abstract: Fiduciaries can't insulate themselves from being sued, but they can minimize their risk and be in a good position to defend a lawsuit if they follow good fiduciary practices. Attorney Carol Buckmann has been writing on the topic for years and has now compiled some of her more popular works in this free booklet.

Source: Cohenbuckmann.com, May 2017

Duke Is Second School to Lose Round in Retirement Plan Lawsuits

Abstract: A lawsuit accusing Duke University's retirement plan of high fees and poor investments is moving forward after a federal judge issued a mixed ruling on the school's motion to dismiss.

Source: Bna.com (registration may be required), May 2017

Breach of Fiduciary Duty Case Against University Survives Motion to Dismiss

Abstract: The U.S. District Court for the Northern District of Georgia issued the highly anticipated first ruling in the university breach of fiduciary duty cases. In Henderson v. Emory University, the court ruled that, for most of the claims asserted, the plaintiffs had properly stated a claim that survives the defendants' motion to dismiss.

Source: Ballardspahr.com, May 2017

Could a Switch to Roth Be Good for Retirement Security?

Abstract: There's been a lot of rumbling on and around Capitol Hill about a potential shift to Roth contributions for 401k plans as part of tax reform. So, how might that weigh on -- or boost -- retirement savings?

Source: Asppa.org, May 2017

Bundled or Unbundled?

Abstract: FRA PlanTools CEO and Managing Director David Witz recently surveyed third party administrator clients as well as professionals who once were part of TPAs regarding why one may want to work with a TPA. Some mentioned bundled providers, and discussed the plusses and minuses they entail.

Source: Asppa.org, May 2017

Fourth Circuit Agrees: Fiduciaries' Faulty Process for Eliminating Stock Funds Did Not Cause Plan's Losses

Abstract: This case demonstrates that the "would have" standard for showing that a plan fiduciary's breach did not cause a loss is difficult, but not impossible, to satisfy. Making a prudent choice by an inadequate process, however, is just lucky. Plan fiduciaries are on much safer ground when they establish and carefully follow a prudent process.

Source: Thomsonreuters.com, May 2017

Current Retirement Policy Legislation Update

Abstract: This article reviews several bipartisan retirement policy initiatives being considered by Congress. It starts with three bills introduced in 2017 addressing the issues of lifetime income disclosure, leakage, and plans with closed groups. It then reviews two proposals that were introduced in 2016, the Retirement Savings Lost and Found Act and the Retirement Enhancement and Savings Act.

Source: Octoberthree.com, May 2017

Three Questions for Assessing a Target-Date Fund's Fixed Income Allocation

Abstract: In target-date funds, fixed income assets play a critical role in managing portfolio volatility and generating strong risk-adjusted returns. Plan sponsors may want to consider the points reviewed in this 4-page paper when evaluating a TDF's fixed income allocation.

Source: Jpmorgan.com, May 2017

Private Equity Adds Fuel to 401k Recordkeeper Consolidation

Abstract: Just as 401k recordkeepers cry poverty, claiming there are no profit margins left and fueling consolidation, private equity has jumped in, perhaps seeing value that traditional recordkeepers are missing.

Source: Investmentnews.com (registration may be required), May 2017

Fidelity Retirement Savings Analysis: Savings Rates, Account Balances Climb to Record Levels

Abstract: Fidelity Investments released its quarterly analysis of its 401k and Individual Retirement Accounts.

Source: Businesswire.com, May 2017

Emory Is First College to Lose in Retirement Plan Lawsuits

Abstract: Emory University must continue defending a lawsuit accusing its retirement plans of carrying high fees and offering poor investment options.

Source: Bna.com (registration may be required), May 2017

Choosing the Savings Strategy That's Right for You

Abstract: There are employer-sponsored 401ks or 403(b)s and, for savers without access to either of those options, IRAs in all of their shapes and sizes. But what should one think about some of the other options? How do those plans or account types fit into an overall retirement strategy?

Source: Amazonaws.com, May 2017

Managed Accounts Evolving in DC Space

Abstract: Providers are enhancing managed accounts with new features and are seeking to maximize the benefits of these solutions in order to outweigh their costs.

Source: Planadviser.com, May 2017

Preparing DC Menus for the Next Evolution

Abstract: Pressures call into question the adequacy of today's core menus and should spark a discussion regarding how menus can evolve to help participants build for retirement. That discussion should begin by examining where participants are putting their money.

Source: Pionline.com, May 2017

California to Push Ahead With Private-Sector Retirement Program

Abstract: Despite a setback in Washington last week, California leaders say they will push ahead with their plan for a state-run retirement program, a move that sets the stage for a legal battle with businesses, trade groups and possibly federal regulators.

Source: Latimes.com, May 2017

Why Women Need More Money in Retirement

Abstract: Between longevity, the wage gap, and a lack of investment confidence, women need a different retirement planning approach.

Source: Journalofaccountancy.com, May 2017

Build a Better 401k

Abstract: One change employers can make is increasing the automatic enrollment deferral contribution. The average automatic deferral is about 4%. Employers could increase the default deferral to 10% or 15% over time to help employees start putting away more money for their retirement.

Source: Bsllp.com, May 2017

Acosta Looking to Freeze DOL Fiduciary Regulation

Abstract: Labor Secretary Alexander Acosta says the Department of Labor's fiduciary rule is his number one priority, and that he is actively seeking a way to freeze the rule that will "stick."

Source: Asppa.org, May 2017

NAFA Launches Campaign to Stop DOL Fiduciary Rule

Abstract: The National Association for Fixed Annuities has launched a grassroots campaign to appeal directly to the Trump administration as well as to Labor Secretary R. Alexander Acosta to stop the Department of Labor's fiduciary rule from taking effect on June 9.

Source: Thinkadvisor.com (registration may be required), May 2017

The Problem With Using Forfeitures to Satisfy Employer Contributions

Abstract: When forfeitures occur within a 401k plan, they are then generally available to the sponsor for the purpose of funding additional employer contributions to the participants of such plan or paying certain plan related administrative expenses. This article discusses a newly proposed IRS rule that brings an expansion to the permissible uses of forfeitures to fund employer contributions.

Source: Legacyrsllc.com, May 2017

How the Media and Markets Conspire to Thwart Retirement Savers

Abstract: The disconnect between the needs of the media and the needs of retirement savers tends to distort the significant of index returns. "The job of the media is to gain attention, and with attention, certain information is left out to make the news more attractive," says Joanna Leng, Financial Advisor in Singapore. "It is not meant to mislead, it's just not a holistic picture."

Source: Fiduciarynews.com, May 2017

The June 9 Fiduciary Deadline and Key Issues for Broker-Dealers

Abstract: The new definition of fiduciary advice will apply on June 9. That means that investment recommendations to ERISA plans, participants or IRAs will be fiduciary advice. Broker-dealers and their advisors will, in essence, be co-fiduciaries for providing that advice. As a result, broker-dealers need to develop internal policies, procedures, training and supervision as quickly as possible in order to be in compliance by June 9.

Source: Fi360.com, May 2017

Dodd-Frank Overhaul Could Cause Fiduciary Rule Mess

Abstract: A major overhaul of the Dodd-Frank Act that would also repeal the DOL's fiduciary rule could cause a mess for the financial services industry if it is enacted after the rule's June 9 applicability date.

Source: Bna.com (registration may be required), May 2017

More Employers View HSAs as Part of Retirement Strategy

Abstract: The health savings account market is continuing its massive growth, as well as its increasing importance to the retirement industry. According to a survey conducted by the Plan Sponsor Council of America, more than 75% of plan sponsors "view the HSA as part of their retirement benefits strategy."

Source: Benefitnews.com, May 2017

Video: President Trump's First 100 Days and the Impact on Retirement

Abstract: Retirement in the age of Trump must take into account a host of macro and demographic factors, such as increased longevity and fewer defined benefit plans. Financial broadcaster Liz Claman speaks with three experts on their view of retirement, touching on topics such as the future of the fiduciary rule and the global macroeconomic outlook.

Source: Assettv.com, May 2017

States Revolt Over Retirement Plan Repeal

Abstract: You can take your rollbacks and shove it. That's the message to the Senate after it repealed an Obama-era regulation last week that allowed states to auto-enroll private sector workers in government-run 401k and IRAs for those who lack retirement plan access.

Source: 401kspecialistmag.com, May 2017

Fiduciary Prologue to a Cross-Examination

Abstract: The fulfillment of fiduciary duties becomes apparent where there is evidence of behaviors and methodology, in "content and oversight," that improve the likelihood that the beneficiary of the asset(s) achieve their goals. When one is compelled to discover evidence of fiduciary behaviors, clues materialize in the products that were purchased, the timing of the purchases, how such products meshed and correlated with other assets, the level of compensation, and any compensation relationships if applicable.

Source: 401khelpcenter.com, May 2017

How Freelancers in America Are Keeping Up With Their Retirement Preparation

Abstract: Freelancers are hardly better than their counterpart salaried professionals in planning for their retirement. Why are freelancers not saving for their retirement and what are some potential retirement plans for freelancers?

Source: 401khelpcenter.com, May 2017

2017 PLANADVISER Top 100 Retirement Plan Advisers

Abstract: Chart highlights the quantitative standouts according to the dollar value of qualified plan AUA as well as the number of plans under advisement. The qualification standards continue to rise, as specialist advisers and consultants build their practices.

Source: Planadviser.com, May 2017

CHOICE Act Targets Fiduciary Rule, Dodd-Frank Rollback

Abstract: Passage of the CHOICE Act by the House Financial Services Committee could signal a further blow to conflict of interest regulations adopted by the Obama administration.

Source: Planadviser.com, May 2017

Use of Forfeitures in Safe Harbor 401k and 403(b) Plans

Abstract: The IRS issued proposed regulations stating Qualified Non-Elective Contributions (QNECs) and Qualified Matching Contributions (QMACs) will be considered non-forfeitable at the time allocated to participant accounts.

Source: Ntsa-net.org, May 2017

Oregon Board Adopts Final Rules to Implement Retirement Savings Program

Abstract: The Oregon Retirement Savings Board adopted final rules to implement the Oregon Retirement Savings Program. OregonSaves establishes a state-sponsored payroll deduction retirement savings plan requiring Oregon employers that do not offer retirement plans to their employees to make payroll deductions from their workers' wages into the state's program. Despite these final rules, OregonSaves' future still remains uncertain due to the Trump administration's likely rollback of state savings arrangements.

Source: Littler.com, May 2017

401k Regaining Importance as Future Income Source

Abstract: Half of nonretirees expect 401k to be a major income source in retirement. This is up from a low of 42% in April 2009, but still below earlier highs. Planned reliance on Social Security is near 17-year high.

Source: Gallup.com, May 2017

Why the Fiduciary Rule Applies to IRAs but Not Non-ERISA 403(b)s

Abstract: Aren't IRAs exempt from ERISA and thus any of ERISA's fiduciary provisions? And what about the many 403(b) plans that are also not subject to ERISA? If the fiduciary does not apply to those plans, why would it apply to IRAs?

Source: Plansponsor.com, May 2017

The Tiered Investment Menu: A Behavior-Based Approach to Menu Design

Abstract: The marketplace is trending towards a redesign of the investment menu. This is being done through investment menu segmentation into behavior-based levels or tiers. Many plan sponsors and financial educators are finding this new tiered menu approach easier to communicate and simpler for employees to understand how to select investment options that may be most suitable for them.

Source: Fiallc.com, May 2017

Protecting Your Qualified Retirement Plan Now That the IRS Determination Program is (Mostly) Closed

Abstract: A lot has been written over the last few months about what to do now that the IRS has closed its determination letter program for ongoing individually designed tax-qualified retirement plans. Most of the focus seems to have been on fear: as time passes, how will we know whether a retirement or 401k plan is still qualified?

Source: Erisapracticecenter.com, May 2017

Fourth Circuit Upholds Ruling in Tatum v. RJR Pension Investment Committee

Abstract: The district court ruled that the defendant's breach of its duty of procedural prudence, occurring when the plan sold non-employer stock funds, did not cause the substantial losses in the retirement plan.

Source: Erisalawyerblog.com, May 2017

DOL Fiduciary Rule: Good for Business but Opposed by the U.S. Chamber

Abstract: The DOL's fiduciary rule is also pro-business by making it easier for 401k plan sponsors to meet their fiduciary responsibilities and lower their plan expenses. The author writes, "While I understand the COC is representing the interests of the financial services industry by opposing the Fiduciary Rule, I think their position is myopic -- they should be supporting the rule to better represent their much bigger constituency of 401k plan sponsors."

Source: Employeefiduciary.com, May 2017

Presentation Slides: State-Run Retirement Plans, What Labor Allowed

Abstract: Partner Andrew Liazos presented insights and strategies for retirement, health and executive compensation plans. He addresses the various state retirement plan approaches, such as auto enrollment IRAs, state marketplaces, prototype plans and Medical Expenditure Panel Surveys.

Source: Employeebenefitsblog.com, May 2017

Are Your Target-Date Funds Making You a Target?

Abstract: Although participants' entire accounts may be invested in these funds, all too many TDFs are selected by fiduciaries simply because it is convenient, or there is some incentive, to offer their provider's funds. This makes them an easy target for class action lawyers. Custom TDFs, which are designed for an employer's specific participant group, are also vulnerable if they don't include appropriate investments.

Source: Cohenbuckmann.com, May 2017

Starwood Hotels Can't Escape ERISA Lawsuit Over 401k Fees

Abstract: Starwood Hotels must defend a proposed class action accusing it of violating federal benefits law by allegedly mismanaging the company's $1.2 billion 401k plan.

Source: Bna.com (registration may be required), May 2017

Washington Is Making It Tougher to Retire

Abstract: Americans face two big problems as they get older: a shortage of retirement savings and the skyrocketing cost of health care. Both may be about to get worse after two narrow votes in Congress this week.

Source: Bloomberg.com, May 2017

The DOL's Assessment on the Quality of Financial Statement Audits: The Aftermath

Abstract: It has been almost two years since the DOL released the results of its study of the quality of work performed by independent qualified public accountants (IQPAs). This article succinctly summarizes the quantifiable aspects of their study.

Source: Belfint.com, May 2017

Senate Repeals State-Sponsored Retirement Plans

Abstract: The Senate repealed an Obama-era regulation that allowed states to auto-enroll private sector workers in government-run 401ks and IRAs for those who lack retirement plan access.

Source: 401kspecialistmag.com, May 2017

Administrative Check-Up on Participant Plan Loans

Abstract: The IRS just issued a memo to its auditors approving two different methods for calculating the statutory limitation on available loan amounts when a participant takes a new loan within 12 months of having paid off another loan or is obtaining a new loan with an other loan outstanding. In addition to verifying your recordkeeper is properly utilizing one of the two approved methods, it is also a great time for an overall plan loan check-up.

Source: Poynerspruill.com, May 2017

Five Things People Get Wrong About ERISA Fidelity Bonds

Abstract: One of the most important and least understood aspects of plan administration is the requirement that those who handle plan funds and other property be covered by a fidelity bond. Here are five things you may not know about ERISA fidelity bonding and may be getting wrong.

Source: Napa-net.org, May 2017

DC Plan Report: Targeting the Right 'Glidepath'

Abstract: Retirement readiness in the US is low at a time when the over-65 population cohort is expanding. Target-date funds have rapidly become the most popular investment option in defined contribution plans, serving as the default option in many. Now DC plan sponsors are evolving/shelving TDFs from recordkeepers in favor of more flexible options, while adding financial wellness counselling to boost the productivity of participants.

Source: Ipe.com, May 2017

Which 401k Strategies Work Best

Abstract: The most effective tools in retirement savings are not bells and whistles. They are simple, quiet and consistent. The Vanguard Group recently identified three powerful best practices that make a difference in 401ks.

Source: Forbes.com, May 2017

Helping Small Businesses and Their Workers Save for the Future

Abstract: A workplace retirement savings plan is an effective and easy way for a small business owner and his or her employees to save for a secure retirement. And there are many retirement savings options available for small business owners to choose from.

Source: Dol.gov, May 2017

401k Myths You Can't Afford to Believe

Abstract: Most of the positive PR about 401k plans is warranted. But don't believe everything you hear. Falsehoods -- and even following fact-checked 401k rules of thumb in every situation -- can steer savers off course. Here are five 401k rules worth further scrutiny.

Source: Usatoday.com, May 2017

Infographic: Five Ways to Motivate Millennials Through Employee Communication

Abstract: According to Gallup, Millennials make up close to 40% of the United States workforce. However, less than one-third of them are engaged at work. Encouraging Millennials to take action concerning their employee benefits can be a difficult task. This infographic highlights five of tactics.

Source: Retirementtownhall.com, May 2017

Bill Would Address Loan Repayments and Savings After a Hardship Withdrawal

Abstract: The Shrinking Emergency Account Losses (SEAL) Act would allow employees to continue to contribute to their DC plans during the six months following a hardship withdrawal, among other things.

Source: Planadviser.com, May 2017

Reaction to State Auto-IRA Plan a Hint of Things to Come?

Abstract: A new study examines what small business owners in Connecticut think about the state's new retirement plan and how well they grasp it. With other states putting similar plans in place and still more considering them, the results may offer a look at what other states may anticipate, and questions and concerns they may face.

Source: Ntsa-net.org, May 2017

White House Blog Reiterates Protection for Retirement Savings

Abstract: In a White House blog entry posted late on April 26, National Economic Council Director and chief economic advisor to President Trump Gary Cohn reiterated his earlier comments that retirement savings will be protected as tax reform proceeds.

Source: Ntsa-net.org, May 2017

Despite Fiduciary Rule's Delay, DOL's Measure Has Spurred Changes

Abstract: Despite the delay, analysts say the mere threat of the federal rule going live -- along with a decade of class action litigation -- already has wrought changes to an industry more in the public view than ever before. As the attorneys who represent companies parse the fine print to ensure legal compliance should the rule stand, some observers predict many companies will adopt stricter standards for a simpler reason: good business.

Source: Nationallawjournal.com, May 2017

It's Hard to Spend Down Your 401k in Retirement

Abstract: At a recent conference, retirement experts concluded that the lack of an easy drawdown mechanism in 401k plans was the major challenge facing the 401k system.

Source: Marketwatch.com, May 2017

Pre-retirees Who Work With an Advisor Are Twice as Likely to Feel Well Prepared for Retirement

Abstract: A new LIMRA Secure Retirement Institute study finds 43 percent of U.S. pre-retirees (ages 50-75) who work with an advisor feel well prepared for retirement, compared with just 21 percent of pre-retirees who do not work with an advisor.

Source: Limra.com, May 2017

Death of the 'Blind Squirrel' 401k Adviser Greatly Exaggerated

Abstract: Over the last decade, many experts have been predicting less experienced advisers will be forced out of the 401k market. With the Department of Labor's conflict-of-interest rule set to create more fiduciary advisers, those same experts are even more sure. But they're wrong.

Source: Investmentnews.com (registration may be required), May 2017

A Guide to 401k Fees and Fee-Related Liabilities for Retirement Plans

Abstract: The topic of 401k fees has dominated the headlines for the better part of this decade. Running a company 401k plan is an arduous task. Navigating fiduciary responsibilities is also a potential minefield of liability as ambitious law firms aggressively attempt to exploit the subjective regulatory frameworks of the IRS and the DOL. Nowhere within a 401k plan is there more potential liability than with regard to the subject of fees.

Source: Forextv.com, May 2017

District Court Dismisses Allegations That Stable Value Fund is Too Conservative

Abstract: A district court in Rhode Island dismissed claims by participants in the CVS Employee Stock Ownership Plan that plan fiduciaries imprudently invested plan assets in the plan's stable value fund.

Source: Erisapracticecenter.com, May 2017

At the Intersection of the NFL Draft, ERISA, Divorce, Venue and Spousal Benefits

Abstract: Judge Woodlock, in the United States District Court for the District of Massachusetts, just issued an order on venue and QDROs in ERISA litigation that is a "must read" as a tutorial on a number of ERISA issues.

Source: Bostonerisalaw.com, May 2017

R.J. Reynolds Cleared Again in Nabisco 401k Stock Dump

Abstract: R.J. Reynolds Tobacco Co. once again escaped liability for losses suffered by its 401k plan when the company sold off the stock of its Nabisco subsidiaries.

Source: Bna.com (registration may be required), May 2017

DOL Bucking Trump on Fiduciary Rule? Former Officials Say No

Abstract: Critics of the Department of Labor's fiduciary rule claim that by letting some portions of the rule take effect in June, the department is standing in the way of President Donald Trump's directive to review the rule. But former DOL officials interviewed by Bloomberg BNA say these accusations are greatly exaggerated and ignore how the agency and rulemaking works.

Source: Bna.com (registration may be required), May 2017

Fiduciary Sudoku -- Comprehending ERISA 3(16), 3(21) & 3(38)

Abstract: Vendors who service retirement plans will use the terms 3(16), 3(21) and 3(38) to describe their service offering. The terms have often been taken for granted, and sometimes abused by service providers looking for a marketing edge. This article offers some clarification and understanding regarding the terms.

Source: Alliantwealth.com, May 2017


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