Best Practices for Scaling a Retirement Advisory Firm
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Items of Special Interest to Service Providers Best Practices for Scaling a Retirement Advisory Firm The retirement plan adviser landscape needs newcomers who can both support and eventually replace the old guard, according to industry participants. But how can advisers best build their practices amid a tight labor market across many sectors in an industry that is both specialized and heavily regulated? Here are some best practices for growing a retirement advisory team in the right way. Source: Planadviser.com Why Digital Recordkeepers are Poised to Disrupt the Retirement Plan Market Digital recordkeepers are poised to disrupt the retirement plan market as 401k plan sponsors face more cost pressures and have a lower threshold for underperformance, finds a new Cogent Syndicated report from Escalent. These plan sponsor concerns present an opportunity for digital recordkeepers to solve a need and unexpectedly disrupt the market, the report concludes. Source: 401kspecialistmag.com Comparing Seven Defined Contribution Plan Designs - 2023 Here is an example showing the results of comparing seven plans for a small business. The owner was willing to spend on staff an amount equal to 5.0% of their total combined payroll. The results show the differences that can be obtained from various plan designs. The best design for any given situation will vary depending on employee ages and salaries, as well as company objectives. Source: Consultrms.com General Items Boosting Participant Engagement By implementing automatic features, using targeted communications, and speaking to participants on a personal level, plan sponsors will be more successful in driving engagement, according to experts. Source: Plansponsor.com Fiduciary and Plan Governance What is a 401k Fiduciary: Key Responsibilities and Duties This guide explains everything you need to know about being a 401k fiduciary. This includes understanding your legal responsibilities and finding ways to reduce your liability and make compliance easier for your plan. Source: Forusall.com The Clash Over ESG in Retirement Plans At this time, the 2022 ESG Rule remains in effect, which means ERISA plan fiduciaries may continue to consider any relevant factors (including ESG factors) in evaluating and selecting an investment. While it is unlikely that H.R. 4237 will advance out of committee, when considered along with the two lawsuits against the DOL that are still ongoing, it is clear that the 2022 ESG Rule will likely continue to be subject of strong opposition for the foreseeable future. Source: Ropesgray.com »» Click here for more Fiduciary and Plan Governance Material Insight: Studies, Research, and White Papers Stepping Into the Future: Employers, Workers, and the Multigenerational Workforce This 120-page report, a collaboration between the nonprofit Transamerica Institute and Transamerica Center for Retirement Studies, examines employers' workforce management-related concerns and how they are enhancing their business practices and benefit offerings to adapt to new post-pandemic realities. Underscoring employers' vital societal role, the report includes detailed findings about their flexible work arrangements, health and welfare benefits, workplace wellness programs, retirement benefits, and best practices for the multigenerational workforce. The report offers recommendations for employers and workers. Source: Transamericainstitute.org Gen X, the First 401k Generation, Is Least Prepared for Retirement Gen Xers entered the workforce as pensions were fading and 401k plans were "primitive." Now they are closest to retirement but feel least ready for it, according to Transamerica research. Source: Planadviser.com »» Click here for More Studies, Research, and White Papers Court and Legal Three Key Issues in the Yale 403b Jury Trial Verdict The authors of this article suggest that "Yale should never have been sued in the first place, because the plan fiduciaries were at the forefront in pushing TIAA and other investment providers for lower fees to benefit plan participants." The article is an analysis of three key issues on the Yale 403b plan defense verdict. Source: Euclidspecialty.com 401k Lawsuit Over ESG Is a Sign of the Times The first lawsuit over ESG in a 401k has officially been filed. A plaintiff alleges that ESG led to lower returns, but the case brought against American Airlines' defined-contribution plan might be more political than substantive. Source: Investmentnews.com Judge Rejects Proposed Class Certification in Remanded TIAA Retirement Plan Case U.S. District Judge J. Paul Oetken denied a class certification claim by plaintiffs seeking to represent about 8,000 participants in Washington University in St. Louis retirement plans managed by recordkeeper TIAA in a June 27 opinion in U.S. District Court for the Southern District of New York. The district court found no "single policy" affecting all putative class participants from Washington University in St. Louis. Source: Planadviser.com »» Click here for more Court and Other Legal Issues Cyber and Plan Security DOL Provides Cybersecurity Tips For Plan Sponsors, Participants If it wasn't already clear to plan sponsors and retirement plan advisers, Employee Benefits and Security Administration head Lisa Gomez reiterated this week the importance of cybersecurity and increased protection for participants in a new post providing eight areas for guidance. In her blog post on the Department of Labor website, Gomez laid out various tips plan sponsors and advisers can convey to participants for keeping their information safe. Source: Plansponsor.com »» Click here for more on Cybersecurity Issues Compliance and Regulatory SECURE 2.0 Act and the Future of the Employee Plans Compliance Resolution System This article discusses the history behind the creation of EPCRS, outlines some of its key features, and highlights how the growth and expansion of this program -- including, most recently, under the SECURE 2.0 Act -- continues to improve IRS enforcement of tax-qualified plan rules by encouraging plan sponsors to establish practices and procedures designed to ensure compliance, thereby avoiding the harsh tax penalties of plan disqualification. Source: Mwe.com As a plan sponsor or financial advisor, it is paramount that you maintain an open line of communication with your TPA or recordkeeper responsible for preparing the 5500 filing to avoid potential penalties and fines from both the IRS and the DOL. To avoid delays in the preparation and filing of the form, here are some things you can do as the plan sponsor to assist your service provider. Source: Legacyrsllc.com What Are Long-term Part-time Employees? One of the ways 401k plans have grown to be the go-to retirement program even over the "free" alternatives like SEPs and SIMPLE IRAs has been the one-year wait, 1,000-hour service requirement for eligibility. Even though that works out to only about 20 hours a week on average throughout the year, it disenfranchised many workers from access to their employer-sponsored retirement plan. Then along came the SECURE Act. Source: Benefit-resources.com The 401k "House-Cleaning" to Come The increase in the automatic rollover threshold from $5,000 to $7,000, as provided for in section 304 of the SECURE 2.0 legislation, will become effective for mandatory distributions made after December 31, 2023. The impact of these provisions could be the "house-cleaning" of small-balance 401k accountholders. Source: 401kspecialistmag.com »» Click here for more Compliance and Regulatory Material Marketplace News CBIZ Acquires American Pension Advisors
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