Newsletter for January 8, 2018
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Are All $5,000,000 401(k) Plans Created Equal?
The 401k Averages Book has released a new Special Report taking a closer look at two 401(k) Fee Benchmarks. The report compares two plans with the same assets with different average account balances. Click here for your copy of the report.
In This Issue
Retirement Plan Trends to Watch in 2018
Abstract: Plan sponsors are ramping up benefits education efforts and increasingly empowering employees to take charge of their healthcare and retirement savings. They're doing this in a variety of ways outlined here.
Why Auto Portability Makes Everything Better
Abstract: In the realm of retirement savings, auto portability is the public policy equivalent of bacon, great by itself, but even better when mixed with other retirement initiatives. In fact, for many public policy plans to be palatable, auto portability is an essential ingredient.
Fiduciary and Plan Governance Material
Liquidity Fees and the Fiduciary Duty of Best Execution
Abstract: Retirement plan fiduciaries must understand the expenses their participants pay to make trades and access investments, but their duty to monitor and ensure reasonableness is not limited to the issue of pricing alone.
How Can Fiduciaries Use New Tax Cuts to Nudge 401k and IRA Retirement Savers?
Abstract: There's a chance for savers to increase the odds they'll retire in comfort thanks to the 2017 tax law. Here's how, but the window of opportunity will close fast.
»» Click here for more Fiduciary and Plan Governance Material
Insight: Studies, Research, and White Papers
Retirement Readiness -- How Do We Compare?
Abstract: This article compares the retirement system of Australia, the United Kingdom, and the United States. The objective is to discover different areas where each country excelled and from which the other two could learn.
»» Click here for More Studies, Research, and White Papers
Major Problem Reported With 401k Auto Enrollment
Abstract: The benefits of automatic enrollment in 401ks are all but a given, and a major reason Richard Thaler, a behavioral economist at the University of Chicago, won last year's Nobel Prize in economics. But now new research has arrived that could wreck it all.
»» Click here for more on Automatic 401k Plan Features
Legislative and Washington DC
Details From the Retirement Plan Simplification and Enhancement Act
Abstract: Alongside numerous proposed changes, employees who work for three consecutive years with at least 500 hours of service each year would have to be made eligible to participate in an employer's plan, but would be excluded from top-heavy and nondiscrimination testing.
Lesser-Known Tax Reform Provisions That May Affect Retirement Plan Sponsors
Abstract: President Trump signed into law the Tax Cuts and Jobs Act. While there are few provisions that directly affect retirement plans, there are a few lesser-known provisions of the new law that may indirectly affect retirement plan sponsors.
Nationwide Spurred by Tax Law to Give Bonuses, Bump 401k Match
Abstract: Nationwide Mutual Insurance Co. will pay $1,000 bonuses to about 29,000 employees and increase matching 401k contributions for all its associates. The move is a response to the new tax law enacted by Congress and signed by President Donald Trump in December, a Nationwide spokesman told Bloomberg Law.
Source: Bna.com (registration may be required)
Tax Law's Pass-Through Provision Could Harm 401k Plans
Abstract: The new tax law's provision on pass-through businesses is proving to be one of the most challenging to dissect, and it's one that some retirement pundits are eyeing with concern. Some industry groups say the pass-through rules could become the most impactful part of the law for 401k plans.
Source: Investmentnews.com (registration may be required)
»» Click here for more on Legislative Actions
How Wall Street Hopes to Thwart 401k Hackers
Abstract: The industry-led project, called Sheltered Harbor, already is known to back up data for savings and checking accounts. But quietly, it's wrapping in data on retail brokerage accounts at some of the nation's largest firms, according to participants. And ultimately, the goal is to expand it to an even heftier pool of 401k accounts and pension funds, whose breach could upend global markets.
»» Click here for more on Cybersecurity Issues
Compliance and Regulatory
Annual IRS Revenue Procedure Includes Surprising Change to User Fees
Abstract: This year's update includes a significant fee change surprise for the VCP program; and while changes in past years typically went into effect about a month after they were announced, this year's changes are effective immediately.
Voluntary Correction Program User Fees Changes
Abstract: The IRS has simplified the user fees charged for most submissions made under the Voluntary Correction Program. The total amount of net plan assets determines the applicable user fee. Most alternative or reduced fees that were part of previous revenue procedures no longer apply.
PBGC Issues Final Regulations for Terminating Defined Contribution Plans
Abstract: The Pension Protection Act of 2006 added ERISA Section 4050(d) which authorized the PBGC to establish a program similar to its existing Missing Participants Program for defined contribution retirement plans and professional service organizations with fewer than 25 active participants. On December 22, 2017, the PBGC issued final regulations making the program available to defined contribution plans and small professional service plans terminating on or after January 1, 2018.
DOL Extends QPAM Relief to Five Financial Institutions
Abstract: The DOL has recently extended the relief previously granted to five financial institutions which allow these banks to continue to rely on the QPAM exemption (Prohibited Transaction Exemption 84-14). The QPAM exemption permits ERISA plans and comingled funds to engage in transactions with "parties in interest" to those ERISA clients without running afoul of ERISA's prohibited transaction rules.
»» Click here for more Compliance and Regulatory Material
Wagner Law Group Expands St. Louis Office
Envestnet Completes Acquisition of FolioDynamix
Joe Mrozek Joins Lincoln Financial
»» Click here for More Marketplace News
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