Record Increases Projected for 2023 Retirement Plan Limits
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Compliance and Regulatory Record Increases Projected for 2023 Retirement Plan Limits The announcement of the official limits is still a few months away, but early projections from Mercer suggest that nearly all qualified retirement plan limits will increase by unprecedented amounts next year. Source: Asppa.org IRS Guidance Extends Deadline for SECURE & CARES Act Amendments On August 3, 2022, in a welcome and surprising move, the IRS released Notice 2022-33, providing for an extension for qualified retirement plans to adopt amendments under the Setting Every Community Up for Retirement Enhancement Act of 2019, the Bipartisan Miners Act of 2019 (which provided defined benefit plans with an optional reduction in the minimum age for in-service distributions from age 62 to 59 1/2), and the Coronavirus Aid, Relief, and Economic Security Act. Source: Erisapracticecenter.com IRS Extends SECURE, CARES Act Amendments Deadline In a bit of good news for plan sponsors, the IRS announced in Notice 2022-33 on August 3, 2022, that it is extending upcoming plan amendment deadlines under the Setting Every Community Up for Retirement Enhancement Act of 2019, the Coronavirus Aid, Relief, and Economic Security Act and the Bipartisan Miners Act of 2019 to December 31, 2025. Source: Cohenbuckmann.com A description of the 401k safe harbor rules, updated for 2022, as well as an explanation of the advantages and disadvantages of this plan design option. Source: Consultrms.com The IRS Throws a Curveball: How to Knock the New Compliance Pilot Program Out of the Park Earlier this summer, the IRS surprised the retirement plan world when it announced a new approach for narrowing the universe of plans seemingly worthy of its investigatory and audit resources. If your organization receives a letter under this new program, what will you do? Will you be prepared to respond? What if the answer is no? Source: Qualifiedplanadvisors.com »» Click here for more Compliance and Regulatory Material Fiduciary and Plan Governance Risk Literacy and Why Your Committee Should Consider It This article offers insight into the complex topic of the various risks DC plan participants face. It also challenges traditional thinking about risk, which often oversimplifies risk as a single category and underestimates the impact various risks have on retirement outcomes. The author believes plan sponsors would do well to deploy time toward "risk literacy" and understand the various risks their participants face as they make critical plan oversight decisions. Risk literacy will help committees prioritize the way they spend time and inform key decision-making. Source: Planpilot.com »» Click here for more Fiduciary and Plan Governance Material Insight: Studies, Research, and White Papers What Mutual Fund Fee Disparities Mean for Retirement Savings When employees decide to leave their employer-sponsored retirement plan, either through retirement or a job change, many decide to roll their savings over into an individual retirement account. A recent study suggests that this can be a risky move financially, as IRA owners are more likely to face higher costs over time. According to a Pew issue brief, when an individual moves their savings over into an IRA, thousands of dollars in savings can be lost over time, simply because of differences in fees between funds or between types of shares within a fund. Source: Planadviser.com Retiring (Much) Later: Average Age Up Big Since 1991 Americans are indeed working longer and retiring later than they used to, with an average retirement age that is four years later than it was in 1991. According to Gallup's annual Economy and Personal Finance survey, conducted each April, the average reported retirement age in the U.S. today is 61, four years older than the same survey found in 1991, when on average people reported they retired at age 57. And notably, the average expected retirement age among non-retirees is now 66, up sharply from 60 in 1995. Source: 401kspecialistmag.com »» Click here for More Studies, Research, and White Papers Items of Special Interest to Service Providers SEC Warns Firms Not to Neglect Conflicts of Interest The SEC is warning broker-dealers and investment advisers that they need to take ongoing steps to identify and eliminate conflicts of interest, noting that all firms have them in some form. Source: Napa-net.org Complexity of QPAM Proposal Could Be a Concern The DOL in late July announced a proposed amendment to the Class Prohibited Transaction Exemption 84-14. An attorney calls the objectives of the proposed amendment 'sensible,' but said implications could be 'unexpected and worrying.' Source: Plansponsor.com Court and Legal The Most "Outrageous" ERISA Complaints Yet Filed? One fiduciary insurance expert who has long been tracking ERISA litigation says a spate of new complaints filed in recent weeks are the "most outrageous" the industry has ever seen. Source: Planadviser.com Booz Allen Hamilton, Others Face Passive TDF Performance Lawsuits Unlike many other ERISA lawsuits, the complaints suggest the plan fiduciaries in question should have considered more expensive target-date funds that might have performed better. The lawsuit was filed in the U.S. District Court for the Eastern District of Virginia, naming as defendants Booz Allen Hamilton Inc., the company's board of trustees, and various committees tasked with operating the management and technology consulting firm's defined contribution retirement plan. Source: Planadviser.com Lawsuit Accuses Fiduciaries of Chasing Low Fees Without Regard to Performance Microsoft Corporation is the target of a new complaint in a series of lawsuits claiming that the BlackRock LifePath Index Funds suite of 10 target-date funds was an imprudent investment choice for defined contribution plans. The lawsuits accuse the defendants of selecting and retaining "poorly-performing investments instead of offering more prudent alternative investments that were readily available at the time." Source: Planadviser.com »» Click here for more Court and Other Legal Issues Legislative and Washington DC Summary of Provisions in the Securing a Strong Retirement Act Staff on both sides of the Capitol are now working to negotiate a unified, bicameral version of retirement legislation that could potentially be included in a must-pass spending bill later this year. This chart compares the House and Senate bills and identifies differences among the bills. Source: Groom.com Keeping Up With the Securing a Strong Retirement Act Because different provisions are included in the House and Senate versions of the ambitious retirement reform legislation, a reconciliation process is likely in store. Source: Planadviser.com »» Click here for more on Legislative and Washington Actions Cyber and Plan Security Cybersecurity Invades Employee Benefit Plan Administration Cybersecurity is a tech-centric term that often makes business unit leadership's eyes roll. That response is risky because cybersecurity ranks among the most vital issues facing human resources, finance, and administration executives. Employee benefit plan leaders face a new era that requires administration and risk management behaviors that are not part of traditional fiduciary best practice thinking. Source: Rolandcriss.com »» Click here for more on Cybersecurity Issues Marketplace News Huntington National Bank, PAi partner to offer Small Biz 401k Solution HUB, Edelman Announce Latest Retirement Acquisitions Empower Renames Great-West to Bolster Brand Sustainable Index Fund Debuts for 401k plans
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