The Rise of Multiple Employer Plans (MEPs)
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General Items The Rise of Multiple Employer Plans (MEPs) Abstract: Smaller to mid-sized firms, trade and professional associations, financial advisors and legislators are fueling increased interest in Multiple Employer Plans (MEPs). The concern about the low retirement savings rate for millions of Americans, particularly those who do not work for large organizations, sparked demand in MEPs as a solution for small to mid-sized institutions to provide quality retirement plan benefits to their employees. Source: Planpilot.com Myths and Realities About Spending in Retirement Abstract: Some people are running out of money in retirement, but many are refusing to spend and are living below their means. Are they doing so out of fear, or do they just not need as much? Source: Planadviser.com Fiduciary and Plan Governance The Fiduciary State of Confusion: The Saga Continues Abstract: Sophistication gaps always cause vulnerabilities because one can potentially take advantage of another and cause harm. There is an ethical element to this that seems to be absent in many dialogues with regards to this subject that is inevitably inescapable but is rather hard to grasp because its obligation was not created by a contract. Source: 401khelpcenter.com Fiduciary Implications of Flexible Retirement Income Solutions Abstract: As DC plans continue to evolve, better plans will likely move beyond the current menu of accumulation options and automation-related innovations to address retirement income challenges faced by their participants in a thoughtful and integrated manner. Moreover, careful fiduciaries will ensure that the processes used to evaluate retirement income solutions are defensible and well documented. Source: Wagnerlawgroup.com Understanding the Unique Value of TPAs Abstract: TPAs offer a unique and independent voice helping retirement plan sponsors find solutions to every day and sometimes challenging problems. Yet because most of the time they are referred by recordkeepers and advisors, their value can be muted. Source: 401ktv.com »» Click here for more Fiduciary and Plan Governance Material Insight: Studies, Research, and White Papers How Does Divorce Affect Retirement Security? Abstract: Divorce is disruptive, pervasive, and expensive. The financial costs can be high: a divorcing couple pays legal fees, may need to sell illiquid assets, and must cover the costs of two -- rather than one -- residence. Not surprisingly, the analysis finds that households with a past divorce are much more likely to be at risk for maintaining their standard of living in retirement. Source: Bc.edu Considering Customized Investment Options in a DC Plan Abstract: As DC plans represent a growing share of workers' retirement nest eggs, plan sponsors and consultants may be considering customized investment options for their DC plan investment menus. This 12-page paper discusses the potential benefits and drawbacks of including nonstandard investment options, particularly white-label funds, in a 401k plan. Source: Vanguard.com »» Click here for More Studies, Research, and White Papers Items of Special Interest to Service Providers Should 401k Advisers Limit Their Roster of Recordkeepers? Abstract: There are clear advantages to having a short roster of "preferred" or "approved" recordkeeper partners, such as ease, efficiency and leverage, advisers said. But there are also drawbacks, such as greater difficulty winning new business and client risk. Source: Investmentnews.com (registration may be required) How Advisers Can Navigate ESG Investing in 401k Plans Abstract: Can ERISA fiduciaries safely apply ESG factors in their investment decision-making? Absolutely. Guidance provided by the DOL under both the Obama and Trump administrations make it clear that any factors, ESG included, that qualify as legitimate economic considerations "should be considered by a prudent fiduciary along with other relevant economic factors to evaluate the risk and return profiles of alternative investments." Source: Investmentnews.com (registration may be required) BlackRock, Wells Fargo Are Betting on Ethical Investing Funds for 401ks Abstract: BlackRock and Wells Fargo are developing their first-ever ESG funds for retirement savings plans, seeking to tap into growing demand for ethical investing. Both firms plan to create a series of target-date funds with this focus, according to people familiar with the matter, with BlackRock aiming to debut some later this year. Source: Bloomberg.com 403b Plans Top 10 Issues Found in 403b Plans Abstract: Compiled from lists published by the IRS, DOL and auditors, here are 10 items to check and review to make sure your 403b plan is operating in line with IRS and DOL expectations. Source: Qbillc.com »» Click here for More 403b Material Court and Legal 401k Excessive Fee Suit Alleges Issues With ETFs, TDFs, and Menu Size Abstract: Another provider has been sued by an employee-participant in its own 401k plan, not just for its inclusion of proprietary funds, but the type and number of options on its menu and its target-date strategy. Source: Asppa.org »» Click here for more Court and Other Legal Issues Cybersecurity Cybersecurity and Employee Benefit Plans Abstract: Benefit plans are uniquely susceptible to cyber-risks because they store large amounts of sensitive employee information and share it with multiple third parties. This 5-minute podcast discusses cybersecurity issues impacting employee benefit plans. It reviews the developing legal framework in cybersecurity and outline practical tips that plan sponsors and recordkeepers may use to secure plan data. Source: Erisapracticecenter.com »» Click here for more on Cybersecurity Issues State-Based Retirement Programs CalSavers Lawsuit Raises Tricky ERISA Questions Abstract: A lawsuit asking a federal court to stop California from implementing CalSavers, a state-administered automatic IRA savings program intended to fill the access gap to employer-sponsored retirement plans, hinges on whether the program will be considered an employee benefits plan under federal law, according to two attorneys. Source: Benefitspro.com OregonSaves Implementing, Refining Interactive Procedures Abstract: The Oregon Retirement Savings Board, the body that runs OregonSaves -- the nation's first state-sponsored savings program for employees whose employers do not offer retirement benefits -- has provided an update on recent activities, implementation and future steps. Source: Asppa.org Compliance and Regulatory The IRS Employee Plans Work Plan for 2018 -- Part One: A "Compliance Checklist" for Plan Sponsors Abstract: With the knowledge the annual IRS Work Plan provides, plan sponsors and their service providers can work to ward off potential problems likely to draw the attention of the IRS. As such, I view the Work Plan as a kind of plan sponsor checklist. Source: Fiduciaryplangovernance.com Reflections on a Dramatic Year for Retirement Plan Regulation Abstract: From the unexpected derailment of the DOL fiduciary rule to the expanding debate about so-called "open MEPs," your plan sponsor clients face a tremendous amount of uncertainty in 2018. Source: Planadviser.com TCJA's Defaulted Loan Extended Rollover Rules have a Serious Technical and Fiduciary Glitch Abstract: Effective January 1 of this year was the right of participants to an extended period to rollover their defaulted loan amount, if the default arose following unemployment or the termination of a plan. The statue has a fundamental flaw: it confuses the rules related to the taxation of the loan with the distribution rules related to defaulted loans. The practical effect of this confusion is that it is virtually impossible to effectively use. Making it work requires the acceleration of the reduction of the plan's retirement benefit, which runs counter to the fiduciary obligations under a loan program. Source: Businessofbenefits.com »» Click here for more Compliance and Regulatory Material
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