Data May Show a Decrease in New 401k Plans
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In This Issue
Items of Special Interest to Service Providers
Data May Show a Decrease in New 401k Plans Summary: Judy Diamond Associates has completed an analysis of new 401k plans launched in 2013, the most recent year for which data is available, and discovered that substantially fewer new plans launched in 2013 than in 2012 possibly meaning fewer people are starting businesses or new businesses find 401k plans a luxury they cannot afford.
Source: 401khelpcenter.com
Why Exactly the DOL's Latest Action Is So Shocking to So Many Brokers Summary: The DOL unveiled its much anticipated conflict of interest rule for retirement invest. advice. The financial services industry has been anticipating stiff 401k rules for years. Even so, the 120-page proposed rule was a shocker, carrying an IRA bombshell and a brand new "best interest standard" for brokers.
Source: Riabiz.com
Thinking About Going Independent? Understanding Your RIA Options Summary: The Registered Investment Adviser model continues to be an increasingly attractive option for independent advisers in today's marketplace. Obviously, there is much to consider before making this type of business decision. Here are some things to think about when searching for the right business model for your practice.
Source: Investmentnews.com (registration may be required)
Creating a Written Information Security Policy for Small RIAs Summary: Both FINRA and the SEC have indicated that they expect advisors to have a written policy to address information security, particularly cybersecurity. Follow these three steps to create a policy that identifies your risks, prevents security breaches, and creates a response plan in case something does happen.
Source: Morningstar.com
403(b) Plans
Facts and Myths of Corrective Distributions Regarding 403(b) Plans Summary: One aspect of 403(b) plans that is not easily understood is the correction deadline for the actual contribution percentage non-discrimination test. This article will provide an overview of the penalty-free and statutory deadlines for corrections for failed tests.
Source: Ntsa-net.org
What Does It Take to Be a Non-ERISA 403(b) Plan? Summary: Private sector (nongovernmental) 403(b) plans established by 501(c)(3) tax-exempt organizations that meet certain requirements may be exempt from ERISA. It is important to note that these plans are not automatically non-ERISA plans.
Source: Consultrms.com
Insight: Studies, Research and White Papers
2015 Retirement Confidence Survey Released Summary: American workers and retirees are expressing higher confidence about their ability to afford retirement this year, even though there is little sign they are taking the necessary steps to achieve that goal, according to the 25th annual Retirement Confidence Survey.
Source: 401khelpcenter.com
Target-Date Funds
Custom Target-Date Options: A Higher Hurdle Summary: Given the high utilization of target-date options in defined contribution plans, target-date options are receiving ever greater scrutiny. As such, custom target-date options are becoming a more popular discussion topic. While there are many factors that could lead a plan sponsor to seriously consider custom target-date options, this nine page paper outlines a few key considerations when considering custom target-date solutions.
Source: Rocaton.com
Custom TDFs: When to Use Them and Why Summary: Custom TDFs are starting to become popular in larger DC plans. But do they make sense for plans with less than $1 billion? According to a report by consultants at Rocaton, the answer is yes, but only in certain circumstances.
Source: Napa-net.org
DOL's Fiduciary Rule Proposal
Supporters, Critics, Gear Up for Fight Over Proposed Expanded Fiduciary Definition Summary: Supporters and opponents of the Department of Labor's conflict-of-interest proposed regulation are wasting no time ramping up their campaigns soon after the Obama administration announced the rule's release.
Source: Pensionrights.org
DOL Not Budging on Fiduciary Rule Comment Period Summary: Labor Secretary Thomas Perez indicated Thursday that his department will not extend further the 75-day comment period for its redraft to amend the definition of fiduciary under the Employee Retirement Income Security Act.
Source: Thinkadvisor.com
Is DOL Education Carve Out Plan Too Murky? Summary: While last week's proposed DOL conflict of interest rule made substantial revisions to 2010's proposal, one carve out affecting providers of financial and investment education remained intact. Though the consistency suggests regulators' desire to protect participants' access to financial education, at least one of those providers thinks the relatively safe provision of the rule is in need of further definition and clarification.
Source: Benefitspro.com
Fiduciary Changes Still Hard to Grasp Summary: The DOL's proposed fiduciary rule is complex and wide-reaching, one experienced ERISA attorney tells PLANADVISER, so the financial industry needs more time to digest the potential implications.
Source: Planadviser.com
Execs See Fiduciary Proposal as Complicated, Costly Summary: Early assessments of the Department of Labor's fiduciary proposal find the new rules will be complicated to implement and costly for the industry, according to wealth management executives. Answering questions during recent earnings calls, industry CEOs and other leaders found themselves peppered with questions from analysts asking about the impact a new rule may have on the bottom line.
Source: Financial-Planning.com
Other Compliance and Regulatory Related
"Cross-Testing" in Qualified Profit Sharing Plans Summary: A quick review of what "cross-testing" is and what kind of employer makes the best candidate for using cross-testing in order to justify higher contributions for the HCEs.
Source: Consultrms.com
Watch Codes on 401k Plan Forms 5500 Summary: The Form 5500 is a lengthy and complex form that employers and plan sponsors and administrators file with the IRS and Department of Labor to provide information about their plans. "Don't sweat the small stuff" is not always good advice in the case of the 5500. Selecting an incorrect code could result in an EPCU compliance check or an examination of the plan.
Source: Asppa.org Summary: When an employee leaves a company and has an unvested portion of money in the company's DC retirement plan, the employee forfeits those funds which he is not vested in, thereby creating a "Forfeiture." These non-vested funds are collected in what's known as a forfeiture account.
Source: Tristarpension.com
Should Canadians Take Advantage of Lower RRIF Withdrawal Rates? Summary: Organizations like CARP and CPA Canada have been lobbying for years to lower the rate of, or even eliminate, mandatory RRIF (Registered Retirement Income Fund) withdrawals. Part of their efforts have paid off. The federal government announced it would lower the required RRIF withdrawal rate at age 71 to 5.28%, from 7.38%. While industry experts agree the move is a victory, it's a small one at that.
Source: Benefitscanada.com
Marketplace News Dynamic Media Launches 401k Specialist Publication MIRA and TriCore Partner on Qualified Plan Offerings Revzon Consulting Announces One-Stop 403(b) Program Fidelity Reports Small-Plan Market Success Chuck Gouge Joins ERISApedia.com as Director of Sales & Marketing Orion, Jemstep Team to Deliver Integrated Technology
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