DOL Sends Message to Plan Fiduciaries
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In This Issue
Fiduciary and Plan Governance Material DOL Sends Message to Plan Fiduciaries: Know What You Are Paying For Summary: As most retirement plan sponsors are keenly aware, DOL final regulations require service providers to deliver specific fee information to responsible plan fiduciary clients. Those 2012 rules reserved a paragraph for future guidance on a guide to help plan sponsors understand the potentially voluminous disclosures. Well, that proposed guidance has arrived, so this article explains what DOL is proposing and how plan sponsors can provide more input before the guidance is finalized. Source: Erisadiagnostics.com Meeting the DOL's Expectations Summary: According to Jennifer Del Nero, assistant regional director for the DOL's Employee Benefits Security Administration in Atlanta, there are four main fiduciary duties the Department of Labor expects from plan sponsors. Source: Plansponsor.com Alternative Investment Checklist: A Guide for Fiduciaries Summary: The investment adviser's duties of conducting routine due diligence on alternatives should include a quarterly checklist to aid board members and key employees at the organization in carrying out their fiduciary duties. Here's a roadmap of some key areas that should be reviewed periodically by both the investment adviser and a key employee at the company sponsoring the retirement plan. Source: Benefitnews.com Summary: An investment strategy acts in the best interest of the plan's participants if it allows them to become "retirement ready." Retirement readiness means that an individual is financially prepared for retirement, and, specifically, is on-target to meet his or her retirement-income goals and maintain the same standard of living after retirement. Update your investment strategy with a few simple steps. Source: Rolandcriss.com
403(b) Plans A 403(b) Plan Annual Checklist Summary: It is important to review the requirements for operating your 403(b) retirement plan annually. This checklist is a "quick tool" to help you keep your plan in compliance with many important tax rules. Source: Irs.gov Summary: Every year it is important to review the requirements for operating your 403(b) retirement plan. Use this "Fix-It Guide" to help you keep your plan in compliance with many of the important rules. Source: Irs.gov
Insight: Studies, Research and White Papers Big Retirement Savings Gains for Small Businesses Summary: As another sign of growing economic health for small businesses, Fidelity's latest Small Business Retirement Savings Analysis reveals increases in average balances and contributions for the third consecutive year. According to the analysis, which looks at more than 200,000 small business accounts, the average balance in these plans increased 4 percent -- and average contributions increased 18 percent. Source: 401khelpcenter.com More Employers Adding Roth Features to Expand Savings Options Summary: As lawmakers debate legislative proposals that would expand the use of Roth features in 401k and other savings plans, an analysis from Aon Hewitt shows companies and workers are increasingly receptive to these features as a retirement savings vehicle. The analysis reveals more U.S. employers are adding Roth 401k features than ever before and participation is also on the rise. Source: 401khelpcenter.com Workplace Retirement Plans Key to Successful Retirement Summary: Guardian released the results of a comprehensive national survey showing wide-spread satisfaction among sponsors who offer qualified retirement plans in the small-plan market, particularly if they work with a financial professional. The survey also shows that opportunities for financial professionals abound in this sector because they are viewed as key to the successful selection, implementation and management of group retirement plans. Source: 401khelpcenter.com One in Five Participants Increase Their 401k Savings Rate Summary: Fidelity announced its average 401k balance is $88,600 at the end of the first quarter 2014, up more than 9 percent from $80,900 one year earlier. The balance is up 92 percent over the 5 years since the first quarter of 2009 -- the market low of the economic downturn -- when it was $46,200. For pre-retirees age 55 and older, the average balance is $165,000. Source: 401khelpcenter.com
Issue of Lifetime Income Lifetime Income: Participant Needs, Retiree Risks and Retirement Solutions Summary: Plan sponsors have done a reasonably good job of focusing on participant needs in saving for retirement, but haven't been as aware of the importance of addressing their needs after retirement. There is no fiduciary requirement to provide post-retirement help in a 401k or 403(b) plan; but when plan sponsors decide to do so, they face a perceived impediment -- fiduciary responsibility. Source: Drinkerbiddle.com Benefit Adequacy Hottest Retirement Benefits Issue Summary: The hottest issue for those in the retirement benefits industry right now is benefit adequacy. Fred Reish noted the focus in the industry has traditionally been savings accumulation, but now the industry is asking, will workers have enough, and how will they withdraw their money so as not to exhaust accounts before they die? Source: Planadviser.com
Plan Automation Auto Enrollment: Two Sides to Every Coin Summary: On the shiny side of the automatic enrollment coin are the positive effects. It can be a great solution for increasing participation rates and it can improve discrimination testing results because of the increased participation. But, as with all shiny coins, there is a flip side to auto enrollment that is often overlooked. Failure to perfectly administer auto enrollment provisions can be costly for a plan sponsor. Source: Milliman.com Automatic Enrollment, Escalation Features Feed 401k Success Summary: More and more, companies which have integrated auto-enrollment and auto-escalation features into the retirement plan design are producing impressive participation and savings rates, more in line with the targets that will result in the kinds of 401k balances participants will need in retirement. Source: Benefitnews.com
Court, Legal, Legislative and Washington DC DOL Obtains Court Order Freezing 401k Fiduciary's Account Summary: The U.S. Department of Labor has obtained a court order from the U.S. District Court for the Western District of Washington that temporarily freezes the account balance of Brenda Lukas-Jones, former president of Lukas Machine Inc., in the company's 401k profit sharing plan and trust. Source: 401khelpcenter.com Supreme Court Considering Fiduciary Responsibility for 401k Plan Company Stock Funds Summary: The Supreme Court of the United States is poised to enter the debate over the standards of prudence and loyalty that an ERISA plan fiduciary must satisfy when a defined contribution plan offers participants a fund dedicated to company stock as one of the plan's investment options. This is a summary and overview of the issue and what's at stake for fiduciaries. Source: Ajg.com
Compliance and Regulatory Related Updated Overview on Blackout Notices Summary: A blackout period is defined as a period of more than three-business days during which a participant has been "temporarily suspended, limited or restricted" from any one of the three reasons. Here is an overview of the rule. Source: Mhco.com Administering Retirement Plan Account Forfeitures Summary: When a participant terminates employment is not the only time defined contribution retirement plan account balances may be forfeited, and there are several ways to deal with forfeited assets. Source: Plansponsor.com More Retirement Plan Problems - Testing & Depositing Contributions Summary: Article deals with how to fix these two problems: 1) The testing for a Plan failed, but was not corrected by the end of the following plan year. 2) For whatever reason, elective deferrals and/or loan payments were not remitted to the Plan's investment custodian within the 7-business day window. Source: Benefit-Resources.com
General Items Canada's Proposed Hybrid Pension Plans Getting Mixed Reviews Summary: The Canadian government's proposal for its new hybrid pension plan is receiving mixed reviews, with some pension experts in favor and labor groups opposed. Kevin Sorensen, the federal minister of state for finance, unveiled the Target Benefit Plans during a keynote address to the Economic Club of Canada. "Target Benefit Plans are a new, innovative proposal that will help support affordable and sustainable pensions for Canadians," he said. Source: Benefitspro.com
Marketplace News Arthur J. Gallagher & Co. Acquires Shilling Limited JP Morgan Upgrades 'Target Date Compass' Program Cambridge Collaborates With the 401k Study Group Arnerich Massena Hires Business Development Officer SEC Charges Utah-Based Retirement Plan Administrator With Defrauding Investors Hawley Troxell Adds New ERISA Group Attorney Employee Benefits Expert Kristi Cook Teams With Trust Builders Aspire Introduces TPA Playbook for Success Baden Retirement Plan Services Rebrands as Ascensus Consulting TSA Consulting Acquires 403(b) Plan Solutions Program Duren Named Head of UBS' Retirement Operations VALIC Integrates LPL Advice Solutions Platform
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