Frequency of Formal Retirement Plan Committee Meetings
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In This Issue - Headlines Fiduciary and Plan Governance
Insight: Studies, Research, Analysis, or Papers Items of Special Interest to Advisers or Other Service Providers 403b Plans Court and Legal
Legislative or Washington DC State-Based Private-Sector Retirement Programs Compliance and Regulatory
Marketplace News Article Summaries Fiduciary and Plan Governance Frequency of Formal Retirement Plan Committee Meetings A PSCA member inquired about the frequency of meetings between company retirement plan committees and their plan recordkeepers and advisors. Currently, their committee meets formally every quarter, but they learned that some committees meet semi-annually. A 2021 PSCA survey found that quarterly meetings were the most common practice. Recently, PSCA asked plan sponsors in a QOTW about their current meeting frequencies to assess any changes. The inquiry also raised the question of whether there is a best practice or standard for how often retirement plan committees should meet with their recordkeepers and advisors. Source: Psca.org How Efficiency Shapes 401k Plan Administration Professional fiduciaries managing 401k plans face the challenge of streamlining administration while ensuring compliance with complex ERISA regulations. Industry calls for efficiency clash with the need for precision, as missteps can lead to serious consequences, including costly corrections or plan disqualification. While enhancing efficiency is crucial, it should not involve cutting corners; instead, it involves creating smarter systems. Fiduciaries are increasingly adopting technology and outsourcing solutions to manage administrative tasks, raising the question of whether these tools can be effective without compromising their responsibility to plan participants. Source: Fiduciarynews.com The Impact Anti-DEI/ESG May Have on Fiduciary Responsibility The pursuit of effective leadership and decision-making has ancient roots. As fiduciaries, it's essential to acknowledge that managing client investments cannot occur in isolation. Instead, one must consider all relevant factors, including the client's core values, priorities, and sense of purpose. Various ethical frameworks can guide fiduciaries in meeting their crucial responsibility to act in the best interests of their clients. Source: 401kspecialistmag.com Get 401k Plan Providers That Will "Hold" Your Hand As children, we relied on trusted figures like parents or older siblings to guide us through life and teach us right from wrong. Similarly, as a 401k plan sponsor, it's essential to seek support from a 401k plan provider. This partnership can help navigate potential pitfalls and avoid costly liabilities, providing the necessary guidance to manage retirement plans effectively. For more details, read this article. Source: Jdsupra.com »» Click here for more Fiduciary and Plan Governance Material Insight: Studies, Research, Analysis, or Papers State of Retirement Planning: Fidelity Study As more Americans approach retirement age in 2025, the latest Fidelity Investments State of Retirement Planning study reveals a growing sense of concern. While 67% of Americans in their planning years feel confident about their retirement, this is a decline of seven percentage points from the previous year, primarily due to ongoing inflation and rising living costs. Despite over 70% of recent retirees reporting that their retirement is proceeding as planned, many are surprised by increased expenses, especially in healthcare. The study, which has been conducted since 2019, compares the expectations and realities of individuals nearing retirement and those recently retired, highlighting the challenges faced during this critical period as a record number of Americans approach the traditional retirement age of 65. Source: Thenewsmarket.com The 401k Has Become America's Rainy-Day Fund Financial emergencies are prompting an increasing number of Americans to tap into their 401k accounts. Last year, approximately 4.8% of account holders made early withdrawals to address issues such as avoiding foreclosure and covering medical expenses. This figure marks a record high, up from a previous peak of 3.6% in 2023 and significantly higher than the pre-pandemic average of around 2%, according to Vanguard Group, which manages 401k-style accounts for nearly five million individuals. As more employers automatically enroll their employees in these plans, the 401k has essentially become a fallback fund for those with limited non-retirement savings. Source: Msn.com »» Click here for More Studies, Research, and White Papers Items of Special Interest to Advisers or Other Service Providers 2025 Study on Advisor Attitudes Toward 3(16) Fiduciary Outsourcing The "Advisor Attitudes Toward 3(16) Fiduciary Outsourcing" survey, conducted by Pentegra in January 2025, explored how over 50 advisors utilize fiduciary outsourcing to enhance retirement plan management for clients. It highlighted the benefits of outsourcing these responsibilities, such as improved compliance and risk mitigation for clients, while allowing advisors to concentrate on their core business operations. Carlo Guerrera, Vice President of Sales and Key Accounts, emphasized that outsourcing 3(16) fiduciary duties to professionals is considered a best practice that provides significant advantages to both advisors and their clients. Source: Pentegra.com 403b Plans 403b Plans Have Special Considerations When Complying With SECURE 2.0 During the PLANSPONSOR Roadmap Livestream session titled "Special Considerations for 403b Plans," speakers addressed new rules affecting long-term, part-time employees and the potential for creating multiple and pooled employer plans. They also highlighted the possible future option for 403b plan sponsors to utilize collective investment trusts. As provisions from SECURE 2.0 are implemented, 403b plan sponsors are encountering new challenges related to plan design and administration. Source: Planadviser.com »» Click here for More 403b Material Court and Legal Swiss Re Group, Empower Targeted in Sweeping Fiduciary Breach Suit A recent lawsuit brings forth extensive allegations of fiduciary breaches related to excessive fees, inappropriate share classes, poor selections of target-date funds, and the improper use of plan forfeitures and participant data. The suit accuses the Swiss Re Defendants of "failing to comply with ERISA’s fundamental principles," claiming they employed flawed methodologies that resulted in suboptimal outcomes. Furthermore, the allegations assert that they opted for costly, underperforming investment options rather than more affordable and superior alternatives, while also imposing exorbitant recordkeeping fees on the Plaintiffs. Source: Napa-net.org BlackRock Lifepath TDF Suit Dismissed, Again A federal judge has dismissed a lawsuit involving BlackRock Lifepath target date funds on behalf of participants in multiple 401k plans, including those from Citigroup Inc. and Genworth, among others. After allowing the plaintiffs three opportunities to strengthen their case, the judge dismissed the suit with prejudice, meaning it cannot be refiled. The plaintiffs were represented by Miller Shah LLP, while the defendants were the fiduciaries of the Cisco Systems Inc. 401k plan, who had previously responded to similar allegations in August 2023. Source: Planadviser.com »» Click here for more Court and Other Legal Issues Legislative or Washington DC Spousal Consent Proposal Re-Introduced in Senate U.S. Senators Tammy Baldwin and Patty Murray spearheaded a coalition of their fellow lawmakers to reintroduce a bill aimed at safeguarding women's retirement security. The Women's Retirement Protection Act of 2025 seeks to tackle the systemic obstacles women encounter in achieving a secure retirement by enhancing protections and offering improved resources to help women better prepare for their financial futures. Source: Ascensus.com »» Click here for more on Legislative and Washington Actions State-Based Private-Sector Retirement Programs Georgia Bill Aims to Create State-Run Retirement Plan Georgia lawmakers have introduced a bill to create Peach State Saves, a defined contribution retirement program designed for private sector employees who lack access to employer-sponsored retirement plans. According to the proposed legislation, employers that do not provide a retirement plan will be mandated to automatically enroll their employees in a state-managed payroll deduction individual retirement account. Employees will have the option to opt out of the program if they choose. Source: Planadviser.com »» Click here for more on Legislative and Washington Actions Compliance and Regulatory Preventive Measure: Self-Audits Help Your Plan Stay in Compliance Morgan Lewis partners Amy Pocino Kelly and Dan Salemi and associate Rachel Mann wrote an article for Benefits Magazine about internal compliance self-audits of employee benefit plans. The article discusses the self-audit process, highlights common areas of compliance that plans should target, and notes changes affecting self-audits included in the SECURE 2.0 Act. Source: Ifebp.org The 401k Safe Harbor Rules provide plan sponsors with a way to satisfy the nondiscrimination requirements of the Internal Revenue Code, ensuring that their retirement plans are fair and beneficial for all employees, particularly for non-highly compensated workers. As of 2025, the Safe Harbor provisions have been refined and updated, offering several key features. This chart reviews the 2025 401k safe harbor rules. Source: Consultrms.com Adoption of SECURE 2.0 Optional Provisions The SECURE 2.0 Act of 2022 was significant retirement plan legislation that introduced various required and optional provisions for retirement accounts and employer-sponsored plans. However, plan sponsors have been slow to upgrade their programs due to the complexity of the legislation. Many have chosen to implement only those provisions that require minor adjustments, such as expanded catch-up contributions for participants aged 60-63. While some features have been adopted, there is hesitation around others, primarily due to a lack of available technology for implementation and uncertainty regarding the administration of the various provisions. Source: Planpilot.com Catch-Up Contributions Get Anticipated Proposed Regulations SECURE 2.0 introduced significant updates to catch-up contributions for participants aged 50 and older. Recent IRS proposed regulations clarify these changes. The first adjustment requires certain higher-paid employees to make catch-up contributions as Roth contributions, which are taxable in the deferral year. This rule will take effect on January 1, 2024, but plan sponsors can delay it until January 1, 2026, due to transition relief. The second change allows participants aged 60-63 to contribute 50% more in catch-up contributions starting January 1, 2025. The proposed regulations also address various operational issues related to these updates, set to take effect in the first plan year that begins at least six months after the final regulations are issued. A summary of the key issues addressed in the proposed regulations is outlined in this article. Source: Groom.com »» Click here for more Compliance and Regulatory Material Marketplace News Capitalize and Public Announce New Partnership to Modernize 401k Rollovers Top DC Plan Recordkeeper Websites Ranked in New Report Groom Law Creates Universal Plan Document Translator Tool Chavez-DeRemer Approved by Senate to Be Next Labor Secretary
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