Retirement Plans Newsletter

November 24, 2015

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Employee Benefits Jobs

Compliance Consultant
Corporate Synergies Group, LLC
in NJ

Sr. Account Specialist
Corporate Synergies Group, LLC
in MD

Relius Software Specialist
SunGard Relius
in FL

IRT Relationship Manager 3
Wells Fargo
in VA

401(k) Plan Administrator
Retirement Systems of Arizona, Inc.
in AZ

Experienced Pension Administrator
KB Pension Services, Inc.
in FL

Client Services Representative - Retirement Services
MassMutual Financial Group
in MA

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Webcasts and Conferences

Staying Ahead of the Curve: Interview with Dr. Shlomo Benartzi, Part I - Save More Tomorrow Insights and Accumulation
RECORDED
(Cammack Retirement Group)

Staying Ahead of the Curve: Interview with Dr. Shlomo Benartzi, Part II - The Decumulation Challenge
RECORDED
(Cammack Retirement Group)

Institute for Apprenticeship, Training and Education Programs
January 18, 2016 in CA
(International Foundation of Employee Benefit Plans [IFEBP])

Worksite Wellness Certification Programs
January 19, 2016 in FL
(National Wellness Institute)

Health Benefits Conference & Expo (HBCE)
January 25, 2016 in FL
(International Foundation of Employee Benefit Plans [IFEBP])

View All Webcasts and Conferences


Discussions


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[Guidance Overview]

DOL 'Clearing the Way' for State-Based Retirement Plans
"The Department's described reasoning for finding that these three approaches will not be swept up by ERISA's preemptive principles is that these approaches, and the involved state activity, do not 'undermine' ERISA's exclusive federal regulation of covered employee benefit plans. These approaches do not mandate employers to adopt or participate in ERISA plans, nor do they mandate any particular benefit structure. The key for the Department is that these programs will remain fully subject to ERISA's regulations, obligations, and remedies." (Benefits Bryan Cave)  


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[Guidance Overview]

DOL Provides Guidance on ERISA Coverage of State-Run Retirement Programs for Private Sector Employees
"The guidance admittedly is not determinative about whether any specific state program would be preempted by ERISA, particularly if the program, when combined with state sovereign immunity laws, would leave state-run plan participants without a remedy.... [By] participating in such programs, an employer would be establishing an employee benefit plan subject to ERISA. Conditions limiting the extent of the employer's involvement in the program, similar to the condition in the current payroll-deduction IRA safe harbor, also must be followed." (Sutherland Asbill & Brennan LLP)  

State-Run Open MEPs Ready to Bloom, But with Challenges
"Challenges to state-backed open MEPs may come from two angles: industry opposition and the need for implementation guidance.... [O]pen MEPs can also be formed across state borders depending on whether the individual states have the extraterritorial authority to do so.... The open MEP approach is 'much more valuable in importance than' the payroll-deduction IRAs because MEPs have the advantages that ERISA brings.... In addition to addressing cross-border authority, guidance is also needed for instances in which a group of states try to bring in employees from nonparticipating states[.]" (Bloomberg BNA)  

DOL's Audit Quality Outreach Continues
"[T]he DOL's recent outreach letter highlights that substandard audit work jeopardizes plan assets and can result in significant civil penalties. It also explains that a quality audit can help to protect plan assets and make sure that the plan is compliant with applicable law.... While it does not appear that the recent letters from the DOL are targeting specific plans for investigation or enforcement, the letters serve as an important reminder to plan fiduciaries to exercise appropriate care in the selection and retention of a plan's auditors." (Morgan Lewis)  

Defined Contribution Plan Participants' Activities, First Half 2015 (PDF)
12 pages. "The vast majority of DC plan participants continued contributing to their plans in 2015:H1. In 2015:H1, 1.8 percent of DC plan participants stopped contributing, compared with 2.1 percent in 2014:H1.... Most DC plan participants stayed the course with their asset allocations as stock values only edged up a bit during the first six months of the year.... DC plan participants' loan activity was essentially flat at the end of June 2015, despite a seasonal pattern observed over the past several years." (Investment Company Institute [ICI])  

2015 IRA Distribution Being Rolled Over in 2016? Facts You Must Know
"Nothing prevents you from taking an IRA distribution in December of 2015 and rolling it over in January of 2016 as long as you follow the rollover rules that always apply. You will want to be especially careful of the 60-day rule for rollovers during this busy time of year.... Report the rollover for 2015.... Apply the one rollover-per-year rule correctly.... Add in the rollover when calculating your 2016 RMD." (Slott Report)  

What Men Can Learn From Women About Saving for Retirement
"Women were 14 percent more likely to participate in 401(k)s and other defined contribution plans than men. Women were also less likely to trade frequently, a practice that can erode returns. And despite having a reputation for being risk averse, women were just as likely as men to own equities[.]" (NBC News)  

Massachusetts Considers Retirement Plan for Workers in Private Sector
"Under [a plan proposed by Secretary of State William F. Galvin], private investment firms would bid to manage the money of participants. That's different from a competing proposal suggesting the assets should go into the state pension fund, as is being considered in California. Galvin's plan would apply to companies with 25 workers or more. As currently envisioned, it would require those employers who do not offer a 401(k) plan to make the state plan available to employees. They would not be required to offer matching funds." (The Boston Globe)  

[Opinion]

Is myRA myRedundant?
"Given the stated reasons for creating myRAs, they do seem to offer some apparent advantages.... The problem is that you can't build wealth for retirement by investing in assets that simply keep pace with inflation.... The inappropriateness of the single investment option calls into question whether myRA is violating a fiduciary duty to the target investors.... Proponents of myRA claim it offers a savings vehicle not currently being offered in the free market. But is that true? ... This calls into question the sustainability of the myRA." (Fiduciary News)  

[Opinion]

DOL Guidance Provides a Big Step Forward for State-Based Initiatives
"Since DOL has created a safe harbor to allow these plans to avoid preemption by the federal private pension law, ERISA, it is critical that the states themselves create strong protections equivalent to those in ERISA.... [The Pension Rights Center] will soon be proposing specific legislative language that states should adopt on disclosures, dispute resolution, spousal protections, and critical fiduciary protections to ensure that the money is invested solely in the interests of participant and to ensure that employee contributions are forwarded to the state program." (Pension Rights Center)  

Benefits in General; Executive Compensation

A Flurry of Important Information from ISS
"ISS announced or released four items important to public companies for the upcoming proxy season: [1] Executive Summary of 2016 Proxy Voting Guidelines Updates; [2] Updated FAQs for application of the Equity Plan Scorecard (EPSC); [3] Opening of the window for companies to update their executive compensation benchmarking peers; and [4] Opening an Equity Plan Data Verification portal for U.S. companies receiving a proxy recommendation." (Winston & Strawn LLP)  

2014 Annual Statistical Report on the Social Security Disability Insurance Program (PDF)
194 pages. "Disability benefits were paid to just over 10.2 million people. Awards to disabled workers (778,796) accounted for 90 percent of awards to all disabled beneficiaries (869,371). In December, payments to disabled beneficiaries totaled more than $11.4 billion. Benefits were terminated for 779,229 disabled workers.... Workers accounted for the largest share of disabled beneficiaries (87.2 percent). Average age was 53. Men represented less than 52 percent." [Data tables are online in Microsoft Excel format.] (U.S. Social Security Administration [SSA])  

Press Releases

International Foundation Announces 2016 Executive Committee
International Foundation of Employee Benefit Plans [IFEBP]

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