Evaluating 401k RFP Responses for the Right Fit
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General Items Evaluating RFP Responses for the Right Fit Summary: Focus on the important few, and ignore the trivial many. Thus advises Michael Malone, managing director of Phoenix-based independent consultant MJM401k, when explaining how to evaluate a request for proposals (RFP) response from a recordkeeper. In other words, concentrate on the key factors that could help a particular plan's participants most and avoid being swayed by the bells and whistles a vendor promotes heavily. Source: Mjm401k.com How to Reach Participants and Boost Engagement Summary: Participants are eager for guidance on saving and investing for retirement and 67% of them expect their employer to play a role in providing it. Although many sponsors offer formal advice programs, other outreach efforts can be even more powerful, particularly when they take into account both how and where participants like to receive information. Plan sponsors and others are exploring communications strategies and channels to engage participants more fully. Source: Ssga.com Annual 401k Plan Education: Five Action Items for Participants Summary: Here are five messages you and your investment adviser may wish to consider sharing with your employees in your annual employee education sessions. Source: Benefitnews.com
403(b) Plans Legacy Assets Are Headaches for 403(b) Plan Sponsors Summary: Retirement assets left with former service providers can pose major administrative and compliance problems for 403(b) plan sponsors -- one that could eventually lead to action from Federal regulators. These so-called legacy assets pose problems because the employer is still required to manage those assets, even though it has moved the entire 403(b) plan to a different provider. Source: Benefitspro.com
Fiduciary and Plan Governance Material New Trend in 401k Plans May Be Headache for Fiduciaries Summary: Target-Date Funds are one of the newest trends in 401k plans. TDFs, including target maturity funds and lifecycle funds, help participants invest more effectively. Additionally, many plan sponsors are re-enrolling participants in TDFs each year, to reduce the plan sponsors' fiduciary risk. While TDFs are established to help participant investment more effectively and protect fiduciaries, these funds might have just the opposite effect on fiduciaries. Source: Schneiderdowns.com Practical Tips for Avoiding Fiduciary Trouble Summary: With the Department of Labor enforcement actions averaging a $450,000 penalty per retirement plan, it's more important than ever to have a paper trail that details how and why a retirement plan sponsor or its fiduciary committee made any decision related to the retirement plan process. Source: Rolandcriss.com Need Help Navigating Investment Responsibilities? Summary: This paper outlines the three types of investment-related fiduciary roles and provides a self-assessment to help plan sponsors determine which approach is best for them. Source: Captrustadvisors.com
Insight: Studies, Research and White Papers Retirement Policy Issues for 2014 Summary: This article reviews key retirement benefits issues that policymakers will focus on in 2014 including: Legislation -- budget and tax battles, Retirement income, Definition of fiduciary, Litigation -- fees and fund menus, Windsor, stock-drop cases, and a variety of DB issues. Source: Octoberthree.com BrightScope Notes the Nations 30 Most Generous 401k Plans Summary: BrightScope announced its inaugural list of the 30 Most Generous Companies ranked by their 401k plans -- uncovering the U.S. companies that value setting their employees up for a strong financial future. BrightScope determined a company's generosity by examining the vesting schedule, eligibility periods and all contributions to the plan made by the company for the sole benefit of the plan's participants. Source: 401khelpcenter.com Study Reveals Major Generation Gap in How the Different Generations Are Planning for Retirement Summary: Financial Finesse has released its second annual research report on employee generational finance issues, attitudes, management styles and preferences. Source: 401khelpcenter.com Affluent Canadians Need $2.3MM to Retire Summary: High net worth Canadians say they require, on average, $2.3mm to be able to live out their ideal retirement lifestyle, according to a study by BMO Harris Private Banking. This amount is two and half times more than the $908,000 average that Canadians as a whole -- irrespective of income level -- identified as the optimal amount required for retirement Source: Benefitscanada.com
Items of Special Interest to Advisors Broker-Dealer Responsibilities for IRA Rollover Recommendations Summary: FINRA Notice 13-45 reminds broker-dealer firms and their registered representatives of their responsibilities under several key FINRA rules, including rules addressing suitability, communications with the public, and supervisory control when recommending a rollover of assets from a tax-qualified retirement plan to an individual retirement account or marketing IRAs and associated services. FINRA intends to make firm practices in this area an examination priority in 2014. Source: Groom.com Revisiting Collective Investment Funds Summary: Retirement plan advisers are seeing continued growth and acceptance of an investment structure from the past: the collective investment fund (CIF). This appears to be due to improved operational tracking arising from technological advances, along with competitive fee and expense characteristics that are highly valued in the current era of financial transparency and disclosure. This article addresses the structural aspects of a CIF and the ERISA implications of offering these funds to qualified plans. Source: Planadviser.com Business Best Practices: Not Your Ordinary TPA Summary: To stay relevant in the rapidly changing retirement services industry, we must always question the status quo and seek new ways to improve our products and services. This article reviews the products and services your firm should be considering and how to innovate with technology. Source: Scs-consultants.com
Court, Legal, Legislative and Washington DC Comparing a QPAM Agreement to a Traditional IMA Summary: A guide for counsel to employee benefit plans governed by ERISA to determine whether they should use a traditional investment management agreement for a particular plan investment or an IMA tailored specifically for a qualified professional asset manager (QPAM) under prohibited transaction class exemption 84-14 issued by the Department of Labor. Source: Practicallaw.com Reliance On Counsel's Advice Was Reasonable, DC Circuit Rules Summary: In affirming the district court's decision, the court pointed out that the defendants -- the retirement plan fiduciaries -- had relied on the advice of counsel when determining the amount payable to Clark from the plan. The district court found that since the fiduciaries rightly relied on counsel's advice, there was no breach of ERISA fiduciary duties. Source: Erisalawyerblog.com
Compliance and Regulatory Related California Company Restores Nearly $2MM to 401k Summary: An investigation by the U.S. Department of Labor's Wage and Hour Division resulted in the restoration of $1,979,779 in 401k pension benefits to 515 drivers working on U.S. Postal Service contracts for Lange Trucking Inc. because of violations of the McNamara-O'Hara Service Contract Act. Source: 401khelpcenter.com Summary: Every year it is important that you review the requirements for operating your Simplified Employee Pension (SEP) plan. Use this checklist to help you keep your plan in compliance with many of the important rules. Source: Irs.gov IRS Announces Establishment of Uniform System for Employee Plans Voluntary Compliance Summary: The IRS has announced the establishment of a uniform system for resolving employee plans closing agreement requests that could not be addressed under the Employee Plans Compliance Resolution System (EPCRS). Plan sponsors may now request a closing agreement to resolve certain income or excise tax issues involving tax-deferred retirement plans established under Code Secs. 401(a), 403(a), 403(b), 408(k) or 408(p). Source: Wolterskluwerlb.com Does Your Form 5500 Make the Grade? DOL Is Checking Summary: The Department of Labor (DOL) has launched an audit quality control initiative for large employee benefit plans subject to a plan audit requirement. It seems they're doing this because of apparent substandard audit reports submitted with some Form 5500 filings. They've assembled a team of analysts who will be reviewing about 400 plan audits for large pension plans and funded welfare benefit plans. Source: Buckconsultants.com
Marketplace News Mutual of America Unveils Enhanced Website Securian Expands Marketing Footprint in Southern California Principal Announces 'Enrollment by Text Message' Tool NTSAA Adopts New Name, Maintains Focus Morgan Stanley Adds $5.5 Billion Retirement Plan Team Principal Teams With NBS to Solve 403(b) Asset Issue National Director Named at Pentegra Retirement Services Plan Sponsor Advisors Launches QDRO Service ING Rebranding as Voya Financial Speakers Announced for 2014 IRI Marketing Summit T. Rowe Price Joins SPARK's Governing Board
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