Communicating in the Digital Age
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Legislative or Washington DC
MEPs and PEPs Compliance and Regulatory
Marketplace News Article Summaries Employee Education and Communications Communicating in the Digital Age Plan sponsors are increasingly using AI-powered, mobile-first, and highly personalized digital communication strategies to engage participants and improve retirement outcomes. Digital channels -- such as microsites, emails, podcasts, and videos -- are now the preferred method, with 75% of Bank of America's communications delivered digitally this year. A growing trend is short, targeted video content timed around key events like open enrollment or salary increases. Source: Plansponsor.com How to Best Personalize Plan Communications Personalized communication is seen as key to helping employees engage with retirement savings and financial literacy resources. A Human-Interest survey found that employees trust these tools, and 87% are more likely to stay with employers who provide them. The level of personalization depends on company size, understanding of participant needs, and collaboration with advisers and recordkeepers. Source: Plansponsor.com »» Click here for more Education and Communications Material Fiduciary and Plan Governance Why the Stated Match Formula Is the Most Dangerous Line in Your 401k Plan Document The matching formula in a retirement plan document, often seen as simple and predictable, can actually be a major source of compliance problems. While employers may assume it's straightforward and "set it and forget it," in reality, it frequently causes operational failures and costly corrective actions, making it one of the most common pitfalls for plan sponsors. Source: Therosenbaumlawfirm.com »» Click here for more Fiduciary and Plan Governance Material Insight: Studies, Research, Analysis, or Papers IRIC Forecasts Retirement Trends to Watch in 2026 The Institutional Retirement Income Council forecasts that next year will see a significant shift toward broader adoption of in-plan retirement income solutions, driven by growing interest in retirement income innovation. In 2025, the industry focused on laying the groundwork through options like target-date funds, annuity marketplaces, systematic withdrawal programs, managed accounts with income features, and middleware integrations. By 2026, consultants and advisers are expected to implement standardized fiduciary evaluation frameworks to help plan sponsors assess, compare, and adopt these features. Source: Plansponsor.com »» Click here for More Studies, Research, and White Papers Court and Legal Recent Wins for Plan Sponsors in Response to Plan Forfeitures Litigation Recent lawsuits have challenged 401k plan sponsors over using plan forfeitures to offset future employer contributions, even when allowed by plan documents. A California district court ruled in favor of the sponsor, stating such claims would add benefits not provided under the plan and conflict with ERISA's established practice of permitting forfeitures under plan terms. Similar rulings in Mississippi and Texas also supported employers. Source: Haynesboone.com Joint Amicus Brief Backs Dismissal of 401k Forfeiture Complaint Against Wells Fargo Several major interest groups -- including the ERISA Industry Committee, U.S. Chamber of Commerce, and National Retail Federation -- filed a joint amicus brief with the U.S. 8th Circuit Court of Appeals. They urged the court to uphold a lower court's June ruling that dismissed a 401k forfeiture complaint against Wells Fargo. The original decision, issued by U.S. District Judge John Tunheim, found that the plaintiff, Thomas Matula Jr., a former employee and plan participant, failed to state a valid claim. Matula appealed dismissal in July. Source: Planadviser.com When $1.8 Million Becomes the Fine Print in the 401k Fee Fight In the 401k space, it's not just about managing plans; it's about managing perceptions of risk. When a plan is large enough to warrant institutional pricing but doesn't secure it, that omission can look like negligence in court. Whether you're an advisor, TPA, recordkeeper, or ERISA counsel, the key question remains: Can you demonstrate prudence if someone scrutinizes your process? This $1.8 million settlement isn't about scandal; it's about process. It underscores a simple truth: documentation outlasts memory, prudence outperforms guesswork, and time always wins. Source: Jdsupra.com »» Click here for more Court and Other Legal Issues Legislative or Washington DC Bipartisan Bill to Streamline 401k Distribution Options, Expand In-Service Rollover Choices is Back A bipartisan bill designed to simplify the 402(f)-notice process and provide clearer guidance and greater flexibility for Americans making retirement savings decisions has been reintroduced in Congress by Representatives Jimmy Panetta and Darin LaHood. Known as the Retirement Simplification and Clarity Act, the legislation -- reintroduced on November 26 -- also seeks to expand in-service rollover options to include annuities for individuals aged 50 and older. Source: 401kspecialistmag.com "Pension Predators" Hearing Targets Abusive ERISA Lawsuits A House Education and Workforce Subcommittee held a hearing titled "Pension Predators: Stopping Class Action Abuse Against Workers’ Retirement." Chairman Rick Allen emphasized the need to protect workers' retirement savings and employers from what he called baseless, predatory class action lawsuits. He highlighted that ERISA safeguards benefits for over 155 million Americans, with plans collectively holding more than $14 trillion to ensure financial security. Source: 401kspecialistmag.com INVEST Act in House Could Finally Be Vehicle to Allow CITs in 403bs After years of delays, legislation allowing 403b retirement plans to use collective investment trusts is close to approval. The House of Representatives is expected to vote on the bipartisan INVEST Act next week. This package combines 20 previously passed bills, including the Retirement Fairness for Charities and Educational Institutions Act, which would amend securities laws to permit CITs and certain insurance accounts in 403b plans, aligning them with 401k rules. The Act was introduced on Dec. 2 by key lawmakers to reduce regulatory barriers, support small businesses, and expand investment options. Source: 401kspecialistmag.com »» Click here for more on Legislative and Washington Actions MEPs and PEPs Pooled employer plans have grown rapidly over the past four years as large employers seek lower governance, fiduciary responsibilities, and administrative costs. The SECURE 2.0 Act of 2022 expanded PEPs to include 403b plans, increasing access for nonprofits and educational institutions. It also extended startup tax credits, enabling small employers joining PEPs to receive a three-year credit to offset costs for new defined contribution plans. Source: Planadviser.com »» Click here for More MEP and PEP Material Compliance and Regulatory 2025 End-of-Year Plan Sponsor "To Do" List: Qualified Retirement Plans As year-end approaches, employers should review their administrative, operational, and compliance responsibilities for qualified retirement plans. This includes confirming adoption of required amendments, updating processes in line with the SECURE Act and SECURE 2.0, and ensuring contributions, testing, and participant communications are on track. A proactive review now helps prevent compliance issues and supports plan integrity as we head into 2026. For convenience, the "To Do" list is divided into four categories. Source: Swlaw.com How the Contribution Limits Interact When an Employer Sponsors Multiple Retirement Plans Annually, the IRS releases updated indexed limits and cost-of-living adjustments for the upcoming tax year, affecting various provisions of the Internal Revenue Code, including income tax deduction rates and retirement plan contribution limits. This article explains how the updated maximum dollar limits apply across multiple defined contribution retirement plans. Source: Icemiller.com To Deem or Not to Deem: Navigating Deemed Roth Catch-Up Elections – A Practical Guide As employers, payroll providers, recordkeepers, and plan administrators prepare for the 2026 Roth Catch-up Rule deadline, an important decision is whether to adopt the optional "deemed Roth election" provision. This provision allows employers to automatically classify catch-up contributions from high earners as Roth contributions once they reach the annual elective deferral limit. These FAQs explain the scope and application of the deemed Roth election provision, outlining its potential benefits and drawbacks for plan design. Source: Truckerhuss.com Did Your 401k Plan Meet the Discretionary Contribution Notice Requirements? Plan sponsors using pre-approved 401k documents with discretionary matching contributions must comply with a new IRS requirement introduced in the 2022 Cycle 3 Restatement. This applies in any year a discretionary match is made. Despite the flexibility of discretionary matches, plans must meet the "definitely determinable benefits" standard by including a clear formula for contribution allocation. To comply, pre-approved plan documents must include specific language and satisfy two notice requirements. Source: Brickergraydon.com From 2025 to 2028, tipped workers can deduct up to $25,000 from federal income taxes, but this may negatively impact their 401k participation. Tips reported on Form W-2 remain subject to withholding and count as compensation for 401k deferrals. While pre-tax deferrals usually offer tax benefits, for tipped employees, they may create a disadvantage by turning otherwise tax-free income into taxable income. Source: Benefitsattorney.com »» Click here for more Compliance and Regulatory Material Marketplace News Vanguard Launches Target Retirement Lifetime Income Trusts ASC and PenChecks Partner to Simplify Automatic Rollover Processes
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