Embracing Social Media and Mobile Technology in 401k Communications
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In This Issue
General Items
Embracing Social Media and Mobile Technology in 401k Communications Summary: The participation in social media and the use of mobile technology among 401k plan participants has increased exponentially. Although traditional benefits communication vehicles have not yet become obsolete, plan sponsors need to take a multichannel approach to benefit communications by factoring in social media and mobile technologies. Article provides some insight.
Source: 401khelpcenter.com
New Companies Try Filling 401k Fee Disclosure Gap, Fall Short Summary: Want proof that the DOL's fee disclosure regulations have not met expectations? There are a growing number of websites that claim to use technology to help sponsors or participants understand or uncover 401k fees. A classic case of the private sector correcting something government got wrong.
Source: Employeefiduciary.com
How to Improve Your Employees' Retirement Security at Minimal Cost Summary: To help retirees meet their financial needs prior to starting social security benefits, employers can educate their employees about the advantages of different spending and social security claiming patterns. Employers could also take this one step further by providing installment-payment features in their 401k plans. Such a feature might pay monthly or quarterly installments of fixed amounts for a set period to enable a retiree to replace the social security income he or she is deferring to optimize the benefit.
Source: Mercer.com
403(b) Plans
Who Is in Charge Here? Will the Real 403(b) Plan Fiduciary Please Stand Up? Summary: Distinguishing who the fiduciary is within a 403(b) plan or other qualified plan is an important determination. It is a highly confused, misinterpreted and somewhat gray area in the world of retirement plan compliance. Many plan sponsors wish to forgo all responsibility and risk related to their fiduciary roles in order to avoid liability and pitfalls and would gladly delegate the role to another third-party. If and how that can be done and some common application of the role of the fiduciary is the essence of this article.
Source: Ntsa-net.org
Insight: Studies, Research and White Papers
Do-it-Yourself Investor Behaviors and the Role of Plan Design Summary: There are many things that can be done in plan design to address both saving and investing to help employees overcome potential obstacles they may be encountering, particularly those who take a "do-it-myself" approach to choosing their investments.
Source: Fidelity.com
Data Show Americans' Continued Commitment to Saving Summary: ICI's latest study of retirement plan savers' actions, based on defined contribution plan recordkeeper data covering nearly 24 million employer-based DC plan participant accounts, shows Americans' continuing commitment to putting away money for retirement.
Source: Ici.org
Employee Benefits: The Road Ahead Summary: With major changes sweeping both health and retirement plans in the private sector, are employment-based benefits facing a "crisis" or merely an uncertain future? A recent industry-wide forum sponsored by the nonpartisan Employee Benefit Research Institute brought together a variety of experts to focus on the issue and the challenges ahead.
Source: Ebri.org
Fiduciary and Plan Governance Material
The Reckless Fiduciary: When Are Imprudent Fiduciaries Liable for Plan Losses? Summary: A recent Fourth Circuit Court of Appeals case has established its own gloss on the ERISA rules to determine when fiduciaries who follow imprudent procedures will have to make up plan losses. The Fourth Circuit rule is based on what a hypothetical prudent fiduciary, who I will call the "prudent shadow," would have done in the same situation.
Source: Pensionsbenefitslaw.com
Avoid Litigation by Helping Plan Sponsors Become Better Fiduciaries Summary: While 401k plans continue to grow in popularity, so has the immense scope of complexity surrounding compliance. Lately there's more attention and scrutiny from regulators and lawyers, making it imperative for plan sponsors to understand their fiduciary roles, the overall process, and how to safeguard themselves before an examination.
Source: Thefiresystem.com
The Small Things that Create the Biggest Problems for 401k Plan Sponsors Summary: When it comes to being a retirement plan sponsor, the greatest threats in breaching fiduciary duty resulting in liability usually comes from the smallest mistakes. This article is to let you know which small mistakes to avoid.
Source: Jdsupra.com
Items of Special Interest to Service Providers
Survey Reveals High Level of Uncertainty Among Plan Administrators Summary: Strategic Benefit Services' "2014 Retirement Plan Survey" uncovers significant uncertainty among employers about retirement plan administration. The survey, which sought to identify significant trends in retirement plan services, found: Nearly 80% of respondents said they were unsure if their plan advisor was acting in a fiduciary capacity; 17% percent of respondents were unsure how their advisors were compensated; and one quarter said they were unsure how often their plan went out to bid, with 22% indicating their plan had never been put out to bid.
Source: Strategicbenefitservices.com
The 401k Retirement Complex: Retooling Americans' Nest Egg Summary: American workers need their employers to provide 401k plans that can help meet their retirement goals. They need their employers to help educate them to make good investment choices. Service providers also are vital to a well-functioning system. But Jerry Schlichter suggests that the 401k retirement complex also needs to retool itself so that it works primarily in the best interests of American savers. According to Schlichter, that is the real retirement crisis we face.
Source: Investmentnews.com (free registration may be required)
Can Dabblers Exist in the DC Market? Summary: Can dabblers survive in today's complicated DC world? While many experts think that advisors must specialize to do well in the 401k and related retirement plan markets, there's a lot of evidence that many advisors with plans under management do not specialize, nor do they intend to.
Source: Napa-net.org
Issues Around Lifetime Income
In-Plan Retirement Income Solutions: Landscape Overview and Obstacles to Adoption Summary: Paper discuss the dilemmas participants face as they prepare for retirement, especially in light of the void left by the diminished role of defined benefit plans. Then lays out the benefits, to both participants and plan sponsors, of an in-plan retirement income solution and discusses the significant barriers plan sponsors face in implementing such solutions, including an analysis of the most significant barrier -- the lack of clear regulatory guidance.
Source: Porteval.com
Court, Legal, Legislative and Washington DC
Fidelity Settles Lawsuit With Own Employees Over 401k ERISA Allegations Summary: Fidelity has settled two lawsuits filed last year by its own employees over allegations that they violated ERISA in the administration of their own 401k plan by charging excessive fees and committing prohibited transactions. Settlement agreement provides for $12 million to be paid to the class and for certain other affirmative relief to be taken.
Source: Fraplantools.com
How Exactly Fidelity Investments Extracted Itself From a Legal and HR Quagmire Summary: Fidelity Investments has quickly and quietly put the ugliest kind of lawsuit to rest -- one in which, technically, Fidelity's 50,000 employees past and present were suing Fidelity as a corporation over conflicts of interest in its $10-billion 401k plan. In drawing a line under the lawsuit that used ERISA as a legal hammer, the Boston-based firm with its $4 trillion in assets under administration was able to pay a $12-million pittance and admit no wrongdoing.
Source: Riabiz.com
Compliance and Regulatory Related
Field Assistance Bulletin No. 2014-01: Missing Participants Summary: A plan fiduciary make reasonable to find missing participants and distribute benefits on their behalf. They must also be able to demonstrate compliance with ERISA's fiduciary standards for all decisions made and demonstrate compliance using paper or electronic records. This FAB reviews how fiduciaries can fulfill their obligations under ERISA to locate missing participants and properly distribute the participants' account balances.
Source: Dol.gov
Be Diligent When Your Employer Terminates Your Company's Retirement Plan Summary: A recent IRS private letter ruling showcased what can happen when a company retirement plan is terminated, and a common mistake that can occur when paying out those funds to employees or ex-employees.
Source: Theslottreport.com
Retention of Plan Documents: A Primer Summary: As a plan sponsor, you have a duty to maintain sufficient records for a period of time. But what does this statement really mean? How long is this "period of time"? What are "sufficient records"? What are the consequences of not retaining such records or of losing them? This article addresses these questions.
Source: Pension-Consultants.com
Avoiding the Hardship of Correcting Hardship Distribution Violations Summary: Administering hardship distributions correctly is important to prevent the hardship of completing a correction of an error in administration. Article reviews a few of the rules regarding: hardship definition, amount of the distribution, eligibility for a distribution, and backup needed and who is responsible for obtaining it. Also suggests a few actions to ensure that hardship distributions are processed accurately.
Source: Belfint.com
Marketplace News Guide Financial Launches New Release of Advisor Software Paper Released on Evaluating TDF Performance Benefits Firm President Pays Nearly $400,000 in Federal Settlement LPL Expanse CRM Offering Through New Relationship With Redtail Technology LPL Unveils ClientWorks Platform for Advisors Retirement Revolution Partners With AdviceIQ
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. 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, but publishers do move or delete articles. Therefore, we can't guarantee that the links provided will remain operational. 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. THIS NEWSLETTER IS PROVIDED FOR INFORMATIONAL PURPOSES ONLY AND DOES NOT CONSTITUTE INVESTMENT, TAX, ACCOUNTING OR LEGAL ADVICE. 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. 401khelpcenter.com, LLC
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