Target-Date Strategies Will Capture 65% of 401k Contributions by 2018
|
Newsletter Sponsor Is Employee Financial Stress Impacting Your Bottom Line? Ignoring employee financial stress drains time, resources and negatively impacts the bottom line. Learn how to get a scholarship of up $25,000 in free financial education training by participating in the Financial Fitness Challenge -- an effective, unbiased online financial wellness program proven to increase 401k participation, reduce healthcare costs, boost employee productivity, and enhance your bottom line. Click here to find out more.
Insight: Studies, Research and White Papers Target-Date Strategies Will Capture 65% of 401k Contributions by 2018 Summary: Plan sponsors, consultants, and advisors have increased focus on target-date decisions as plan assets allocated to target-date funds have increased. New research from global analytics firm Cerulli Associates, predicts that target-date strategies will capture 63.4% of 401k contributions in 2018. Source: 401khelpcenter.com Are Small Businesses Paying Too Much in 401k Fees? Summary: Despite the industry's efforts to make 401k plans more transparent, accessible and low cost, a recent national survey by ShareBuilder 401k found that on average, small business owners who read fee disclosure statements still consider three percent a reasonable price to pay. Source: 401khelpcenter.com Retirement Assets Total $23.0 Trillion - ICI Summary: Total U.S. retirement assets were $23.0 trillion as of December 31, 2013, up 5.0 percent from $21.9 trillion on September 30, 2013, and up 15.6 percent from year-end 2012. Retirement savings accounted for 34 percent of all household financial assets in the United States at the end of the fourth quarter of 2013. Source: Ici.org The Paternalization of Participant-Directed Plans Summary: Studies of 401k plan participant investment behavior indicate that much of the problem lies with the participants themselves. This paper examines the research covering participant investment behavior and how the industry and plan sponsors can address the issue so that the answer to the question, "Is the defined contribution system successful?" becomes an unqualified, resounding yes. Source: Am-a.com
403(b) Plans IRS Revenue Procedure 2014-28 Eases Requirements for Pre-approved 403(b) Plans Program Summary: The Internal Revenue Service (IRS) issued Revenue Procedure 2014-28, which eases the requirements for prototype and volume submitter plans to participate in its Internal Revenue Code (IRC) Section 403(b) pre-approved plans program. Source: Practicallaw.com IRS Extends Deadline for 403(b) Plan Documents Summary: The IRS issued Rev. Proc. 2014-28, extending the deadline for plan document providers to submit applications to the IRS for pre-approval of prototype and volume submitter plan documents from April 30, 2014 to April 30, 2015. While this 1-year extension may not seem like much at first read, author suggests "it is monumental." Source: Erisafile.com
Fiduciary and Plan Governance Material How Do Your Investment Committee Meetings Measure Up? Summary: Investment committees play a key role in the deployment of the $18 trillion or so of institutional assets in the U.S. More often than not, it is an investment committee that establishes strategy, oversees critical asset allocation decisions and selects the people who take day-to-day responsibility for running the money. But how effective are investment committee meetings? Source: Russell.com Do You Monitor Your Service Providers Prudently? Summary: Prudent retirement plan management under ERISA is defined as a plan sponsor acting in the best interest of its plan's participants. With whispers of yet another ERISA rule about conflicts of interest to come out later this year, here are tips to master three key responsibilities before additional regulations are imposed. Source: Rolandcriss.com
Items of Special Interest to Service Providers Avoiding the Pitfalls of the Fiduciary Standard Summary: It's one of the most-anticipated (and most-delayed) regulatory wrinkles in retirement industry history -- the DOL's fiduciary standard. At this week's NAPA 401k Summit in New Orleans, NAPA leadership reiterated that the much-discussed regulations are still scheduled to debut later this year, bringing with them some immediate headaches for advisers and sponsors alike. Source: Benefitnews.com Proposed Regulation to Expand 408(b)(2) Requirements Summary: What will the new regulation require? Quite simply, it is a guide to where certain important information is located within the disclosure documents. Plan sponsors will be directed to a page or section where required information can be found to make it easier to determine if the disclosure requirements are being met. Source: Captrustadvisors.com A Proposed Code of Conduct for 3(16) Plan Administrators Summary: Service providers know a lot more about their products and services than sponsors and they often use this knowledge to their advantage. This is no less true for vendors of 3(16) plan administrator services. Author proposes that no plan sponsor should hire a service provider unless the vendor subscribes to the code of conduct outlined. Source: Fiduciaryplangovernance.com
Court, Legal, Legislative and Washington DC Supreme Court Requests DOL Opinion in Tibble v. Edison Petition Summary: The Supreme Court announced the results of their Friday conference where the plaintiffs' cert petition from the Tibble v. Edison International case was considered. In a surprise move, the Supreme Court has asked the Solicitor General of the United States, working in conjunction with the Secretary of the Department of Labor, to file a brief offering their view on the issues. Source: Fraplantools.com Eighth Circuit Gives Plan Sponsors a Lot to Like in Tussey Decision Summary: Despite the fact the Eighth Circuit upheld the $13.4 million judgment against the Plan fiduciaries for failure to control recordkeeping costs, many aspects of the Circuit Court's ruling are favorable for plan sponsors -- the appellate court recognized that the determinations of plan administrators are owed deference by courts, the $21.8 million judgment against the Plan fiduciaries was vacated, and the judgment against the Plan fiduciaries which was undisturbed was based on facts specific to the case. Source: Benefitsnotes.com Experts Split Over Retirement System Summary: In testimony before a Senate panel earlier this month, two prominent retirement public policy experts delivered a blistering rebuke of the defined contribution retirement system, even taking financial advisors to task for charging high fees and in some cases dispensing bad advice. Source: Insurancenewsnet.com
Compliance and Regulatory Related Brokerage Account Windows Shutting in 401k Plans Summary: Recently the Department of Labor indicated they intend to provide additional guidance on the use of brokerage account windows. Experts believe it is likely to be unfavorable for brokerage window proponents. Source: Lawtonrpc.com Rehired Employees: When Do They Enter the Plan? Summary: Practitioners find the eligibility rules difficult to understand while the employers find them completely counterintuitive. The rehired employee rules are even more challenging for practitioners and employers. This is a review of the rules with examples. Source: Relius.net DOL Makes Push for Compliance in 401k Plans Summary: According to the DOL, 401k plans are not complying with the vast standards imposed by ERISA and other laws. 75% of plans audited last year resulted in fines, penalties or the plan sponsor being forced to make reimbursements for administrative errors. The DOL is looking at anything and everything when they audit 401k plans. This article lists some items they are looking at. Source: Nhhicks.com New Two-Year Period to Adopt Restated Pre-Approved DC Plans Summary: The IRS expects to issue most opinion and advisory letters for the latest round of pre-approved defined contribution plans on March 31, 2014. Employers using pre-approved defined contribution plan documents must adopt plan documents restated for the 2010 Cumulative List by April 30, 2016 (Announcement 2014-16). Source: Irs.gov What the DOL Will Ask for in a 401k Plan Audit: Documentation You Need Summary: It is not just the shock of being audited that impacts plan sponsors, but the amount of information they need to provide. Sometimes, the requested documentation may not be available, which creates its own set of issues. Source: Foxrothschild.com
General Items The Status Quo Is Not Acceptable Summary: "It's not just about a decision to save, it's about saving more." NAPA Executive Director/CEO Brian Graff captured the heart of the discussion over retirement readiness at a March 25 session of the NAPA 401k Summit in New Orleans. Graff debated Teresa Ghilarducci, Chair of Economic Policy Analysis and Director of the Schwartz Center for Economic Analysis at the New School -- and well-known critic of the 401k system. Source: Napa-net.org Tax Credit for Small Employer Start-Up Plans Summary: Many employers are unaware that they may be eligible for a valuable tax credit in connection with their establishment of a retirement plan. Although this particular tax credit has been available for over a decade, it is still surprising to see the general lack of awareness that most plan sponsors have regarding this tax savings opportunity. This article is intended to familiarize readers with this tax credit. Source: Legacyrsllc.com
Marketplace News Mutual of Omaha Unveils 401k Health Assessment Tool SunGard Launches Tool to Help Advisors Grow 401k Business Lincoln Financial Adds Two Regional Sales Directors NAPA Taps Dimitriou as NAPA President for 2014-2015
This eNewsletter is a digest of information published by a variety of web-based sources on 401k and related issues and is published as a service to our users. 401khelpcenter.com, LLC is not the author of the material unless specifically noted. We review each article to ensure that it is related to the interests of our subscribers, but 401khelpcenter.com, LLC does not endorse and disclaims any and all responsibility or liability for the accuracy, content, completeness, legality, or reliability of the material. Reliance on this material should only be undertaken after an independent review of its accuracy, completeness, efficacy, and timeliness. All articles are copyrighted to their publishers. If you believe that your work has been copied in a way that constitutes copyright infringement, please contact the source site immediately. All links were tested before this eNewsletter was e-mailed to you to ensure that they are still functional.
Copyright © 2014 by 401khelpcenter.com, LLC. All rights reserved. No reproductions without prior authorization, but you are free to email this copy (in its entirety) along to colleagues or clients. This newsletter may not be posted to any website.
THIS NEWSLETTER IS PROVIDED FOR INFORMATIONAL PURPOSES ONLY AND DOES NOT CONSTITUTE INVESTMENT, TAX, ACCOUNTING OR LEGAL ADVICE.
401khelpcenter.com, LLC
|
