The Future of Innovation in DC Plan Design
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PSCA's 2019 National Conference
Click here for full information. In This Issue
Insight: Studies, Research, and White Papers The Future of Innovation in DC Plan Design Abstract: If strengthening retirement security is the goal, then success can only be measured based on improving long-term outcomes. Unfortunately, as DC savings plans have taken the place of traditional DB plans, the shift has been away from outcomes to inputs. Returning to a true focus on outcomes requires moving away from a myopic focus on savings to evaluating whether retirees will have sufficient income to meet their needs once they stop working. This approach to retirement security considers an individual's retirement life cycle. Source: Georgetown.edu Abstract: Plan fiduciaries are seeing increased interest in socially responsible, or impact, investing as an option in their plan offerings. However, given the numerous and sometimes conflicting priorities that plan sponsors face, how important should the focus on socially responsible investing strategies be? This report reviews the history behind socially responsible investing and strategies for incorporating ESG investments in your plan's investment menu. Source: Strategicbenefitservices.com »» Click here for More Studies, Research, and White Papers General Items 2018 Plan Sponsor Site Enhancements Abstract: Three prominent trends embody most of the changes that retirement plan recordkeepers made to sponsor sites: the modernization of user interfaces, an increased focus on mobile capabilities and the continued development of plan health resources. In addition, multiple firms enhanced educational suites and security practices. Source: Corporateinsight.com Fiduciary and Plan Governance Emerging Trends in 401k and 403b Fund Menus Abstract: Given the shift in participant mindset and demographics, it's important for retirement plan committees to re-think the traditional approach to designing plan investment menus. Article discusses the strategic outcomes fiduciaries should be focused on when designing a fund lineup for their plan. Source: Greenspringadvisors.com Fiduciary Duty and the Choice Between Active and Passive Abstract: There is nothing passive about being a fiduciary investment adviser, even when it comes to making decisions about passive investing. The duty of care requires the adviser to proactively exercise the skill, prudence and good judgment of a professional when selecting investment strategies and specific investments to serve investors' best interests. The well-recognized merits of passive investing do not mean that all index investments are prudent or superior to active alternatives in all situations. Source: Investmentnews.com (registration may be required) »» Click here for more Fiduciary and Plan Governance Material Items of Special Interest to Service Providers What 401k Recordkeeper Consolidation Means to Retirement Plan Advisers Abstract: The recent report that Principal Financial is likely buying Wells Fargo's retirement record-keeping division could be a harbinger of massive 401k recordkeeper consolidation that puts even more assets and participants in the hands of fewer providers. What does that mean for plan advisers, and what can they do to prepare? Source: Investmentnews.com (registration may be required) Blockchain Will Upend the 401k Market Abstract: Blockchain technology is poised to completely upend the retirement market and the way 401k advisers do business. The technology, while nascent among recordkeepers of defined contribution plans, promises to boost cybersecurity, increase efficiency (thereby decreasing overall 401k plan costs), and vastly improve data sharing between advisers and recordkeepers. Source: Investmentnews.com (registration may be required) »» Click here for More 403b Material Target-Date Funds Five Areas Where Target-Date Funds Increase 401k Plan Sponsors' Fiduciary Liability Abstract: For all their convenience, for all their popularity, the increased reliance on TDFs does not necessarily shield the 401k plan sponsor. The author spoke to corporate retirement plan advisers from across the country. They identified five ways TDFs expose plan sponsors to fiduciary liability. Source: Fiduciarynews.com »» Click here for more on Target-Date Funds Court and Legal Tenth Circuit Upholds Great-West Stable Value Win in ERISA Case Abstract: The U.S. Court of Appeals for the Tenth Circuit affirms a District Court's holding that Great-West Life & Annuity Insurance Co. was not a fiduciary with respect to its stable value fund, even though it announced the fund's credited rate quarterly. Source: Hklaw.com Podcast: Attorney-Client Privilege in the Employee Benefit Plan Context Abstract: Paul Hamburger, co-chair of Proskauer's Employee Benefits & Executive Compensation Group, and associate Joe Clark discuss how the attorney-client privilege rules apply in an employee benefit plan context. The attorney-client privilege allows for the free flow of information between an attorney and a client in order to insure that the client gets the best possible representation. We discuss the various specific rules that apply in the employee benefit plan context where information is often shared between attorneys and plan fiduciaries. Source: Erisapracticecenter.com Longest Running 401k Fee Lawsuit Ends in $55 Million Settlement Abstract: Parties in the longest running 401k fee lawsuit have agreed to a $55 million settlement, bringing to near conclusion a 12-year case that's one of the best-known of its kind. The lawsuit, Tussey v. ABB, was among the initial tranche of lawsuits attorney Jerome Schlichter brought in 2006, alleging that employers had caused their employees to lose out on retirement savings due to overpaying for 401k plan services such as recordkeeping and investment management. Source: Investmentnews.com (registration may be required) »» Click here for more Court and Other Legal Issues Legislative and Washington DC "SECURE Act" May Advance Soon in House, Mirroring "RESA" Abstract: A new bill introduced in the House of Representatives, dubbed the "SECURE Act," mirrors many of the provisions of the popular Retirement Enhancement and Savings Act (RESA) that failed to pass during the last Congress. According to a statement from the Insured Retirement Institute, which has advocated for RESA as well as this follow-up legislation, the new bill was negotiated by a bipartisan team of House Ways and Means Committee members. Source: Planadviser.com »» Click here for more on Legislative and Washington Actions Cyber and Plan Security Best Steps to Avoid a Cyber Attack on Your 401k Plan Abstract: With everything from pizza deliveries to multi-million dollar deals being handled online, it should come as no surprise that hackers might target you 401k plan. However, security breaches don't stop with an unknown party simply accessing your participants' personally identifiable information. Hacks also can lead to unauthorized withdrawals of funds from 401k plans. This article provides some best practices for avoid this type of costly breach. Source: Hallbenefitslaw.com »» Click here for more on Cybersecurity Issues State-Based Retirement Programs Pacific Rim Adds to State-Sponsored Retirement Plan Earthquake Abstract: The Pacific Rim, a place where it's a bit less unusual than others for new land to explode into existence, is adding to the state-sponsored retirement plans earthquake. Add Hawaii and Washington to the states whose legislatures have or are considering legislation that would create state-sponsored retirement programs. Source: Napa-net.org Compliance and Regulatory Puerto Rico Tax Reform Act Includes Retirement Provisions Abstract: The Act focuses on promoting economic development in Puerto Rico and introduces various changes that impact individuals and corporations including changes to tax withholding rates for lump sum distributions from retirement plans, the compensation limit for Highly Compensated Employees, and distributions following a Disaster Declared by the Governor of Puerto Rico. Source: Prudential.com IRS Issues Operational Compliance List for 2019 Abstract: On March 22, 2019, the Internal Revenue Service issued the Operational Compliance List for tax-qualified retirement plans. The Operational Compliance List is mandated by IRS Rev. Proc. 2016-37 and notifies plan sponsors and service providers of changes to the tax-qualification requirements that became effective during the 2019 calendar year. Source: Westlaw.com »» Click here for more Compliance and Regulatory Material Marketplace News 2019 Signature Award Finalists Announced PSCA Announces New Plan Sponsor Credential Principal Launches Retirement Plan Investment Option Focused on Guaranteed Rates of Return »» Click here for More Marketplace News
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