Newsletter for May 21, 2018
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The Fiduciary Rule and Fee Disclosure Keep 401k Fees a Hot Topic
With the Department of Labor's Fiduciary Rule and 408(b)(2) requirements creating a focus on fees, the new 401k Averages Book is a must have resource guide. Now you can choose from $10,000, $50,000, and $100,000 Average Account Balances to benchmark your clients and prospects. This easy to use to book provides benchmark fee information on investment, revenue sharing, recordkeeping and total plan costs. The 401k Averages Book is the most recognized source for comparative non-biased 401k information. Click here for more information.
In This Issue
Insight: Studies, Research, and White Papers
The Top 25 401k Plans
Abstract: Listed here in descending order, Employee Benefit News, in partnership with business intelligence data analytics firm miEdge, presents the top 25 401k plans in the United States based on plan-year-end net assets as of April 9, 2018.
Source: Benefitnews.com
Research Shows Gig Economy May Replace Retirement
Abstract: For many survey respondents, the gig economy is replacing how they plan to earn income in retirement: 16 percent plan on having gig economy jobs to supplement their retirement; 12 percent of side-hustlers will keep a side-gig job as their main source of income after retiring from their traditional career; and, one in five full-time giggers say they'll continue to pick up incremental work in the gig economy as their main source of income following "retirement."
Source: Betterment.com
Plan Fees Have Fallen, But So Have Deferral Rates
Abstract: Data from BMO GAM shows DC retirement plan fees have fallen for all sizes of plan sponsors except those with between $10 million and $50 million in assets.
Source: Plansponsor.com
Redefining Retirement
Abstract: Employees are working longer, whether because of increasing life expectancies or lowered confidence about their ability to retire. Longer work lives are tied to less engagement and more stress, among other negative impacts. For employers, this may mean taking time to consider shifting benefits or programming to better meet changing needs both to help employees retire when they want and stay healthier if they continue working.
Source: Ubabenefits.com
»» Click here for More Studies, Research, and White Papers
Fiduciary and Plan Governance
Why Plan Sponsors Should Regularly Benchmark Retirement Plan
Abstract: A vital plan fiduciary responsibility is regular benchmarking of plan performance and fees against industry averages. This kind of cross-referencing is the responsibility of plan sponsors and can come with significant risks and opportunities. This article looks at the factors that make sound benchmarking practices so crucial.
Source: Planpilot.com
»» Click here for more Fiduciary and Plan Governance Material
Items of Special Interest to Service Providers
Private Equity Firms Seeing a Lot to Like With DC Provider Investments
Abstract: This article highlights the appeal of retirement services companies to private equity firms. The industry is experiencing active M&A activity as private equity investors pursue stable cash flows, reliable revenue, and guaranteed growth.
Source: Ascensus.com
Wells Fargo Struggles to Attract 401k Business in Wake of Banking Scandals
Abstract: Wells Fargo's retirement plan business has suffered following a string of negative stories related to operations within some units of the broader company, according to 401k advisers who use Wells Fargo products and who have had conversations with Wells retirement executives.
Source: Investmentnews.com (registration may be required)
Court and Legal
Stable Value Snub Draws Excessive Fee Suit
Abstract: The law firm of Schlichter, Bogard & Denton has targeted another 401k plan for breach of its fiduciary duties and their claims include that the lack of a stable value fund cost plan participants $41 million.
Source: Asppa.org
University of Rochester Called Out for Excessive Fees Paid to TIAA
Abstract: A participant in the University of Rochester Retirement Program has filed a lawsuit alleging that plan participants have paid an estimated $72 million in in recordkeeping, distribution, and mortality risk fees to provider TIAA.
Source: Planadviser.com
Plan Sponsor Challenged in a Lawsuit for Using Untested Hewitt Funds
Abstract: The plaintiffs say that since these experimental funds were added to the plan in 2013, they have consistently underperformed their benchmarks, and have underperformed the funds they replaced by tens of millions of dollars.
Source: Planadviser.com
»» Click here for more Court and Other Legal Issues
Legislative and Washington DC
Bill Would Create Commission to Advise Congress on Retirement Issues
Abstract: The bill's purpose is to create a commission that would study Americans' retirement security, including private retirement programs, and make recommendations to Congress on how to improve it. The Commission would be expected to complete a review and report to Congress not later than two years after the Commission is established.
Source: Ascensus.com
House Subcommittee Seeks ERISA Changes
Abstract: House Subcommittee seeks bipartisan proposals to update ERISA including encouraging defined contribution plans to provide annuities, eliminating the "common nexus" requirement for private multiple employer plans and other changes.
Source: Benefitsforward.com
»» Click here for more on Legislative Actions
State-Based Retirement Programs
Oregon Auto-IRA Success Shows National Program Would 'Work Well,' Advocate Says
Abstract: Oregon launched a pilot phase of its automatic-enrollment, payroll-deduction individual retirement account program, called OregonSaves, in July 2017. Its early success demonstrates a similar framework could work at the national level, a proponent said at a congressional hearing Wednesday.
Source: Investmentnews.com (registration may be required)
Compliance and Regulatory
Qualified Retirement Plan Audits -- What Your TPA Needs to Know
Abstract: When done correctly, retirement plan audits can be a painless part of the annual administration process for large plan sponsors. However, forgetting to include your compliance consultant in the planning process can cause major headaches for everyone involved.
Source: Tristarpension.com
401k Notice Distribution: Hard Copy vs. Electronic Delivery
Abstract: It seems like 401k plans require a lot of different notices and disclosures be provided to participants each year. We have safe harbor and default investment notices at the end of the year, fee disclosure notices and participant statements each quarter, and the summary annual report when we file our Form 5500. Are we allowed to distribute all of these 401k notices to our participants electronically?
Source: Dwc401k.com
Top 10 Issues Found in 401k Plans
Abstract: Compiled from lists published by the IRS and plan auditors, here are 10 items to check and review to make sure your 401k plan is operating in line with IRS expectations.
Source: Qbillc.com
»» Click here for more Compliance and Regulatory Material
Marketplace News
P-Solve to Rebrand as River and Mercantile Solutions
BPAS Joins LPL Financial Retirement Partner Program
TIAA Launches Mobile App for Plan Sponsors
OneAmerica Unveils Innovative Profit-Sharing Retirement Plan Design
»» Click here for More Marketplace News
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