What the DOL Could Look Like Under Biden
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Click Here for Our Resource Page on Retirement Plans and the Coronavirus PandemicNewsletter Sponsor 401k Averages Book 20th Edition Infographic With the release of the 401k Averages Book 20th Edition, we have updated our infographic "Are all $5,000,000 401k Plans Created Equal?" …and the findings might surprise you. The infographic compares the average costs of two $5,000,000 401k plan benchmarks. Click here to receive a copy of the infographic and see what we found out. In This Issue
Legislative and Washington DC What the DOL Could Look Like Under Biden Joe Biden's presidential election win could have a big impact on the DOL and the coming months will determine how quickly the agency moves forward with new rule proposals. Reversing the invest. advice rule "will be priority No. 1" for the DOL under a new administration, according to Jason Roberts, CEO of the Pension Resource Institute. "Get ready for a true fiduciary rule 3.0," he said. The new administration is also likely to revisit the advisory opinion on the use of private equity in DC plans, Mike Hadley, partner at David & Harmon, said. Source: Investmentnews.com (registration may be required) »» Click here for more on Legislative and Washington Actions General Items What to Consider When Selecting a QDIA When selecting a QDIA, there are many variables to consider. This paper is the third in a series of papers and presents the perspectives of managed accounts providers and target-date fund providers as well as investment consultants and ERISA counsel where relevant. The paper poses several questions that a typical committee might ask when evaluating a QDIA, whether the QDIA is a professionally managed account program or one composed of target-date funds. Source: Ymaws.com Experts Discuss Participant Interest in In-Plan Annuities Industry experts reviewed what companies are doing to engage participants with in-plan annuity options during a webinar hosted by the SPARK Institute. The industry authorities explained how they are drawing participants to in-plan annuity options. Source: Planadviser.com Pandemic Impacts Canadians' Retirement Plans A recent CIBC survey finds that the pandemic has impacted Canadians' savings and their anticipated lifestyle in retirement. Four out of 10 (40 percent) respondents worry about the effect of COVID-19 on their savings and retirement plans, with almost a quarter (23 percent) unable to contribute to their retirement nest egg since the pandemic began. Source: Pensionpulse.blogspot.com Fiduciary and Plan Governance The Power of an Evolving Fiduciary Governance Approach It's an often-overlooked aspect of qualified retirement plan operations, the need for a prudent and comprehensive governance process and identifying the person responsible for creating and "quarterbacking" these efforts. With proper fiduciary governance as a premier regulatory and litigation issue in the defined contribution plan space, the topic could not be timelier. Source: 401kspecialistmag.com The DOL has issued a final rule to revise its existing rule regarding financial factors in selecting plan investments. This article provides a roadmap for fiduciaries on the final rule along with a general discussion of the core concepts under the final rule and some of the key departures from the proposed rule. Source: Bradley.com Should You Establish a Retirement Plan Governance Committee? Retirement plan governance is the system through which key decisions are made about strategy and operations, including plan design, administration, and investment choices. Typically, at the core of plan governance is an official plan governance committee. Although the DOL and IRS do not require a plan to have a plan governance committee, it is considered a best practice to have one. Source: Orba.com »» Click here for more Fiduciary and Plan Governance Material Items of Special Interest to Service Providers For three years, there was relative peace in the land of Department of Labor guidance. DOL investigations continued apace and memories of the 2015-2017 battles over the DOL fiduciary rule began to fade. Then came the summer of 2020. Starting in early June and running at a breakneck pace through August, the DOL struck back in what may be one of its most productive guidance periods ever. Source: Napa-net.org 2021 Challenges for 401k Plan Providers 2020 seems like a bad disaster movie, but a bad one that doesn't seem like it will end. So, it's important to look at some of the 2021 challenges out there for 401k plan providers. Source: Jdsupra.com 403b Plans IRS Simplifies Certain 403b Plan Terminations The IRS has issued guidance for employers and employees related to terminating 403b plans that fund benefits through 403(b)(7) custodial accounts. This SECURE Act-based guidance from the IRS will allow for distributions of custodial accounts under rules similar to those that have been available for annuity contracts under a 403b plan. Source: Planadviser.com »» Click here for More 403b Material Court and Legal Another Self-Dealing ERISA Fiduciary Breach Lawsuit Filed Northern Trust is the latest financial services company to face an ERISA legal challenge, this one filed in the U.S. District Court for the Northern District of Illinois, Eastern Division. The lead plaintiff in the suit says Northern Trust has inappropriately prioritized its investments within a profit-sharing retirement plan offered to employees. Source: Planadviser.com Lawsuit Claims Underperforming TDFs Caused $65M Loss to 401k A former participant in the Allstate 401k plan accuses plan fiduciaries of keeping poorly performing target-date funds on the investment menu and as the plan's default investment. Source: Planadviser.com »» Click here for more Court and Other Legal Issues Compliance and Regulatory Are You Counting LTPTEs for Your 401k Plan? The SECURE Act made changes in the qualified plan rules for eligibility and vesting for so-called "long-term part-time" employees. The changes are designed to allow LTPTEs to make elective deferrals to a 401k plan and, if the employer chooses to provide matching or nonelective contributions to LTPTEs, to permit vesting service based on 500 Hours of Service rather than 1000 Hours of Service. While the first LTPTEs will be eligible to elect deferrals in 2024, employers with 401k plans need to start now to identify and prepare for LTPTEs. Source: Nelsonmullins.com Time to Issue Annual Retirement Plan Notices It is again time for plan sponsors to finalize and issue their annual notices to participants. We have experienced many legislative and economic changes since this time last year, so plan sponsors might have more to consider and update in this year's annual notice outside of the normal changes to plan COLAs and investment expense ratios. Source: Graydon.law ACP Testing for Safe Harbor Plan That Suspended Match Contributions For safe harbor plans that suspend their safe harbor matching contributions, the IRS does NOT permit prior-year testing, only current-year testing. If your plan was NOT a safe harbor plan, it could use prior-year testing if that method was stipulated in the plan document. Recent IRS guidance regarding contribution suspensions in safe harbor plans affirmed this position. Source: Plansponsor.com IRS Proffers Proposed Regulations for Qualified Plan Loan Offsets The IRS has issued proposed regulations for determining whether an offset for an outstanding retirement plan loan receives the extended rollover period for qualified plan loan offsets provided for by the Tax Cuts and Jobs Act of 2017. Source: Hallbenefitslaw.com »» Click here for more Compliance and Regulatory Material Marketplace News Magnifi Integrates Fi360 Fiduciary Score Application Period Opens for QKA Scholarship Program Newport Acquires Plan Administrators, Inc. (PAi) Announcing the 2020 NAPA Top Women Advisors
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