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Ret plans - policy


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[Opinion] Public Pension Storm Warning
"Admittedly, public pension liabilities don't come out of nowhere the way hurricanes seem to -- we know exactly where they will strike. In many cases, we know approximately when they'll strike, too. Yet we still let our elected officials make impossible-to-fulfill promises on our behalf.... Worse, we let our government officials use predictions about future returns that are every bit as unrealistic as calling a 13-inch rain in Houston a 100-year event. And while some of us have called pension officials out, they just keep telling lies -- and probably will until we reach the breaking point." (Mauldin Economics)
Assessing Multiemployer Plans' Capacity for Self-Stabilization (PDF)
12 pages. "Three main options are available to prevent the exhaustion of the [PBGC's] guarantee fund : [1] empower plans to take stronger actions to avoid or delay insolvency; [2] reduce the level of the PBGC's benefit guarantee, and/or [3] increase the revenue flowing into the fund, either through premium increases or by securing additional revenue sources. [This paper focuses on Option One.]" (The Pension Analytics Group)
[Official Guidance] Text of PBGC Final Regs: Bylaws
"PBGC's Board of Directors (the Secretaries of Labor, the Treasury, and Commerce) voted to amend the bylaws at a meeting of the Board of Directors on September 7, 2017. This rule replaces the old bylaws with the new bylaws in PBGC's regulations." (Pension Benefit Guaranty Corporation [PBGC])
Fiduciary Rule's Opponents Seek Elusive Knockout Blow
"Fresh off a victory in securing an 18-month delay for the fiduciary rule's remaining provisions, the regulation's opponents are redoubling efforts to nix it for good.... Rescinding the rule in its entirety, however, has proven difficult in part because of the slowness of the rule-making process and the support the rule enjoys among consumer advocates as well as many within the industry." (Financial Planning)
Voluntary Pensions in Emerging Markets
"In pay-as-you-go pension systems, governments are being forced to make reductions in future retirement benefits due to declining birthrates coupled with rising life expectancy rates. Funded state pension systems ... are seeing that current contribution rates are too low to generate adequate income replacement.... [R]apid development and rapid demographic change are putting increasing pressure on alternative sources of retirement income ... Without reform, a large share of the workforce in most emerging markets will reach old age over the next few decades without adequate pensions, personal savings, or children to support them." (Principal Financial Group)
Investing for Retirement in a Low Returns Environment: Making the Right Decisions to Make the Money Last (PDF)
35 pages; a working paper. "[Y]ounger generations do face substantial challenges, but there are plausible courses of action involving increased contributions and delayed or partial retirement that can provide reasonable income replacement rates in retirement. [The authors] map out the steps that the retirement industry (government, employers, financial services providers) needs to take to support people in following these courses of action, such as providing more flexibility over Social Security." (Pension Research Council, The Wharton School of The University of Pennsylvania)
State-Sponsored Retirement Savings Plans: New Approaches to Boost Retirement Plan Coverage (PDF)
37 pages; a working paper. "This paper describes and evaluates models and features used in emerging state-sponsored retirement saving plans such as Auto IRAs, open Multiple Employer Plans and Marketplaces.... [P]lans that boost coverage most will feature two characteristics: required provision of retirement saving plans by firms and automatic enrollment of eligible workers.... [U]nder current legal and regulatory conditions, Secure Choice is the only model that enables states to require that employers provide a plan." (Pension Research Council, The Wharton School of The University of Pennsylvania)
[Opinion] Do We Need a 'Harmonized' Fiduciary Standard?
"This legal requirement that the interests of one's principal must come before those of one's clients clashes directly with the legal requirement that the interests of one's clients must come before those of fiduciaries such as registered investment advisors subject to the Investment Advisers Act of 1940. This has always been ground zero -- the precise point where the rubber meets the road -- in the fiduciary wars of the last decade." (Morningstar Advisor)
ERISA Advisory Council to Meet September 25
"[An] open meeting of the Advisory Council on Employee Welfare and Pension Benefit Plans (also known as the ERISA Advisory Council) will be held as a teleconference on September 25, 2017.... The purpose of the open meeting is to discuss reports/recommendations for the Secretary of Labor on the issues of [1] Reducing the Burden and Increasing the Effectiveness of Mandated Disclosures with respect to Employment-Based Health Benefit Plans in the Private Sector, and [2] Mandated Disclosure for Retirement Plans -- Enhancing Effectiveness for Participants and Sponsors." (Employee Benefits Security Administration [EBSA], U.S. Department of Labor [DOL])
Commonwealth of Kentucky Pension Performance and Best Practices Analysis: Recommended Options (PDF)
113 pages. "In the aggregate, the Commonwealth of Kentucky's pension plans are among the worst funded in the nation. Without corrective action, the large and growing unfunded liabilities associated with these pension benefits not only threaten the retirement security of plan participants, but they are also eroding the fiscal stability of the state ... [This report presents] ideas and alternatives for improving the long-term security, reliability, and affordability of these benefit programs. These recommended options build on [an] analysis of factors that have led to the current conditions ... Actuarial assumptions; Benefit levels and risk exposure; Funding; Investment practices and approach." (pfm)
Oregon's State-Run Retirement Program Requires Employer Action (PDF)
"Employees of participating employers are automatically enrolled in the Roth IRA through payroll deduction, unless they elect to opt out. Employers who currently offer an employer-sponsored retirement plan to their employees are not required to participate in the OregonSaves program. However, these employers are required to file for a Certificate of Exemption. Action is required by all employers with employees based in Oregon, regardless of the employee's state of residence." (Prudential)
OregonSaves and Other State-Run Retirement Programs May Require Employer Action (PDF)
"For employers, the state- or municipality-run programs ... may raise several key issues, including: [1] application to an employer that excludes certain workers from the plan ... [2] administrative difficulties for employers that operate in multiple states... [3] coverage of an individual who may be eligible for overlapping or multiple programs ... and [4] the procedures to follow for payroll deduction [IRAs] that include an automatic enrollment or automatic contribution escalation feature, e.g., the date changes occur or become effective." (Milliman)
[Opinion] Sleeping with the Enemy: DOL's Betrayal of Plan Participants and Retirees
"While the investment industry publicly claims lack of readiness to incorporate the DOL's new fiduciary rule into their business, insiders claim that the industry's real motivation is to delay or totally eliminate the class action provisions of the DOL's rule, to deny plan participants access to the court system and full discovery rights. The fact that the DOL has suggested to a court that it will most likely consent to the investment industry's objection on this matter is very interesting given the express language in ERISA regarding its purpose[.]" (The Prudent Investment Fiduciary Rules)
Rhode Island Hospital Pension Seeks OK for 40 Percent Benefit Cuts
"St. Joseph Health Services of Rhode Island Retirement Plan on Aug. 18 asked a Rhode Island Superior Court judge for permission to enter receivership, which it says would allow for a 'long-term wind-down' of the plan. The plan -- which was 90 percent funded when the hospital was sold to California-based Prospect Medical Holdings Inc. in 2014 -- now has a deficit of more than $43 million and could become insolvent as early as 2026, according to the [123-page] receivership petition filed with the court.... The decision to seek receivership was driven in part by St. Joseph's belief that the pension plan would lose 'church plan' status on or before Dec. 31, 2018, the petition says." (Bloomberg BNA)
[Opinion] Pension Action Center Director Cautions ERISA Panel on Electronic Delivery of Pension Documents
"The current system of mailing printed copies of key documents, particularly Summary Plan Descriptions and individual benefit statements, is key for retirees to understand their pensions and make sure they receive what they are owed, said [Jeanne Medeiros, director of the Pension Action Center at the Gerontology Institute, part of UMass Boston's McCormack Graduate School]. For starters, many of them don't have computers to see electronic documents." (The Gerontology Institute Blog, University of Massachusetts Boston)
[Opinion] American Benefits Council Letter to PBGC: Recommendations for Regulatory and Deregulatory Actions
"Of all of PBGC's programs, the [Early Warning Program] has perhaps the greatest potential to disrupt the normal operation of the American businesses to which it is applied. Yet the Program operates without any statutory or authorizing regulatory guidance.... [The Council is] very concerned about the recent use of the financial soundness of the plan sponsor as a factor in PBGC's exercise of its enforcement and interpretive authority.... PBGC can and should publish its reports on its financial condition based on the same assumptions that Congress has imposed on private plans." (American Benefits Council)
600,000 Connecticut Residents Could Join State-Run Retirement Savings Plan
"After a half-year-long delay in gathering enough members to get off the ground, the state's Retirement Security Authority met for the first time [August 24], with the task of setting up a new payroll deduction savings plan for as many as 600,000 residents who do not have traditional plans.... State residents could begin to register for retirement savings accounts in 2019 or 2020." (ctpost)
[Guidance Overview] The DOL Fiduciary Rule: Charting a Course, Avoiding Collisions and Potential Litigation
"Does the creation of this fiduciary duty under the DOL's exemption result in a potential cause of action at all under state law? If so, what state law or duties will be applied if and when a purchaser chooses to attempt to enforce that fiduciary duty in a state court litigation? ... What are the primary areas of concern during the transition period for litigation, particularly class action litigation, involving financial institutions and advisers under the DOL's temporary rule? ... [W]ill the financial institution (or insurer), as well as the insurance agent, face potential claims of fiduciary breach, given that it is unlikely the institution itself has established the requisite relationship of trust and dominance?" (Carlton Fields)
Mixed Messages About Retirement Tax Provisions Causing Alarm
"The House Ways and Means Committee is telling stakeholders that revenue associated with retirement savings won't be used to fund tax reform ... But individual members say they are working with leadership to develop ideas around a concept known as 'Rothification' that would tax savings upfront, rather than when they're withdrawn in retirement ... Ideas under consideration include taxing all savings upfront or allowing a certain amount to be contributed tax-free with anything over the limit being subject to a levy." (Bloomberg BNA)
DOL Again Signals Death of Fiduciary Rule's Arbitration Ban
"A legal challenge to the fiduciary rule's anti-arbitration provision will 'likely be mooted in the near future,' the [DOL] told a federal district court. The statement is the latest indication that the department may be working to undo portions of the Obama-era rule, including the anti-arbitration provision, which is aimed at making it easier for investors to bring class actions against financial advisers" [Thrivent Financial for Lutherans v. Acosta, No. 0:16-3289 (D. Minn.; letter to the court, filed Aug. 23, 2017)] (Bloomberg BNA)
[Opinion] The 'Pension Crisis' Is a Myth, Part Three
"Illinois does face real challenges with its public pension systems, challenges that will take years to resolve.... Illinois' pension problems are the direct result of years of mismanagement and deliberate underfunding by governors and legislators of both parties. Resolving these problems will take the commitment of lawmakers from both parties to fully fund the state's pension obligations every year." (National Public Pension Coalition)
[Opinion] The 'Pension Crisis' Is a Myth, Part Four
"When a pension plan is closed ... it can no longer invest on an infinite time horizon. At a certain point in time, all of the participants in the plan will be retired and will be collecting benefits and no new employees will be paying into the plan. As the number of retired members in the plan continues to increase over time, with fewer and fewer active members contributing, the plan must shift to more conservative, lower-return investments in order to maintain the assets they already have. This makes it more difficult to pay down any unfunded liability already present in the plan." (National Public Pension Coalition)
[Opinion] American Retirement Association Weighs in on Nevada Fiduciary Law
"The comment letter ... concludes that courts would find that the Nevada statute is preempted by ERISA to the extent it seeks to regulate financial advisers who provide services to a retirement plan governed by ERISA, to the plan's fiduciaries and/or to the plan's participants or beneficiaries." (American Retirement Association)
A Common Sense 401(k) Plan for Small Businesses
"TSP-like 401(k) plans are a common sense retirement plan -- a safe harbor of sorts from the confusing array of services, fee structures and investments offered by 401(k) providers today. That said, these simple and effective plans are not for everybody. Sometimes, 401(k) investments and investment-related services with higher fees are a better fit for a small business and its employees. Not sure if you're one of these businesses? Compare these services against a TSP baseline to decide if they are worth the extra money." (Employee Fiduciary)
Standing and Plausibility in ERISA
"A [federal] district court in New York has held that a plaintiff cannot assert claims against a plan in which she did not participate and cannot assert claims of fiduciary breach without plausible allegations of wrongdoing.... [The court] dismissed claims that a stable value fund was depressing returns and pocketing the difference between the amount credited to the investments and the actual return on the investments." [Dezelan v. Voya Retirement Ins. & Annuity Co., No. 16-1251 (D. Conn. July 6, 2017)] (Seyfarth Shaw LLP)
District Court Rejects Union's Challenge to CalPERS Amendment Increasing Retirement Age
"The case goes back to the Golden State's budget crisis in 2013, when lawmakers passed a law that raised the retirement age to 62 for its state workers' pension plan CalPERS... The union said the change violated the Contract Clause of the U.S. Constitution by retroactively impairing the union's contract rights and sued CalPERS, Gov. Jerry Brown and other state administrators. In her ruling for summary judgment in favor of the state, U.S. District Judge Beth Labson Freeman found the change to the contract was legal." [Local 101 AFSCME v. Brown, No. 14-5640 (N.D. Cal. Aug. 16, 2017)] (SCVNews)
Survey of Financial Planners Says DOL's Fiduciary Rule Already Hurting Savers, Financial Professionals
"The Financial Services Roundtable ... polled 600 financial advisers [in July 2017]. The survey, conducted ... one month after the rule's June 9 initial compliance deadline, shows 'significant disruption' to the marketplace ... A majority of the poll's respondents, or 50 percent, report the rule is restricting them from serving their clients' best interests." (LegalNewsLine.com)
[Opinion] How I Passed My Passion for Retirement Saving on to My Children
"Many employers offer retirement savings plans. They even offer a match within the plan, and still, hundreds of thousands of participants refuse to participate in the plan.... We must educate our young people while they are in grade school and high school on the importance of saving and saving as early as possible. This is the only way to solve the retirement savings crisis. As parents and family members, as business owners and leaders, we need to make retirement savings education a priority at our jobs and in our community." (TriStar Pension Consulting)
Say Goodbye to the myRA Account
"On July 28, the Treasury Department announced that it was ending the myRA program.... The myRA thus goes the way of federal regulations encouraging state and city sponsored IRAs for those who have no access to employer sponsored retirement plans.... Current participants in the myRA program are being notified of the changes and will be provided with information on rolling over their myRA savings to another Roth IRA in the private sector." (Slott Report)
[Opinion] Public Pensions: A Good Deal for Taxpayers (PDF)
"Pension funds are resilient. Pension funds pose little burden, if any, on taxpayers. Taxpayers' contributions are fully or partially offset by the tax revenues generated by public pension investments in the community and by the local spending of retirees who receive pension checks.... [D]ismantling pensions contributes to income inequality, a sluggish economy, and economic volatility.... [If] governments continue to dismantle public pensions they will inflict $3 trillion in economic damage by 2025." (National Conference on Public Employee Retirement Systems [NCPERS])
The Blended Retirement System for the Armed Services: Retention Effects and Continuation Pay Cost Estimates
"Costs are initially higher under the BRS because of service expenditures for [continuous pay (CP)] and Thrift Savings Plan matching contributions, but costs will eventually lower because of the decrease in defined-benefit retirement costs.... The baseline enlisted force is achievable when the CP multiplier is set at or near the floor mandated by Congress. For officers, the floor-level CP multipliers do not maintain baseline retention for any service; CP multipliers close to one year of basic pay for active component personnel are required." (RAND Corporation)
Taxpayers' Preferences Between Front-Loaded and Back-Loaded Retirement Savings Plans: The Relative Effects of Economic and Non-Economic Factors
"While archival data show that retirement savers utilize front-loaded plans [e.g., traditional 401(k) plans] to a much greater extent than back-loaded Roth plans (70.6 percent vs. 23.1 percent of defined contribution retirement accounts), the fact that we find a strong preference for back-loaded plans across several experiments and conditions suggests that the greater use of front-loaded plans is an artifact of artificial barriers to participation in back-loaded plans (e.g., income limitations, employer plan offerings, etc.)." (Center for Retirement Research at Boston College)
Fifth Circuit Oral Arguments May Provide New Hope for Fiduciary Rule Opponents (PDF)
"In questioning consistently skeptical of the DOL's arguments, [Judge Edith Jones] asked whether the DOL has the authority to redefine the term 'fiduciary' in a manner that is inconsistent with its common law meaning.... One of the Chamber of Commerce's challenges is that [BICE] conflicts with Supreme Court precedent stating that agencies cannot create causes of action. Judge Jones ... rejected a defense put forward by the DOL's attorney stating, 'You are deliberately creating fiduciary duties.' " [Chamber of Commerce v. Acosta, No. 17-10238 (5th Cir. oral argument July 31, 2017)] (Groom Law Group)
Plan Sponsors See Struggles If Moving to Roth-Only Retirement Savings
"Forty percent of CIEBA members said it would be very or extremely difficult to explain the Rothification of 401(k) plans to participants." (PLANSPONSOR)
Seventh Circuit: Plan's Forum-Selection Clause Is Not Precluded by ERISA (PDF)
"With support from the Secretary of Labor, Mathias argues that forum-selection clauses in plan documents are categorically invalid because they deprive plan participants and beneficiaries of the right to select from the menu of venue options offered by Section 1132(e)(2).... [F]orum-selection clauses promote uniformity in plan administration and reduce administrative costs and in that sense are consistent with the broader statutory goals of ERISA.... The forum-selection clause in the Caterpillar plan chooses from among the venue options listed in Section 1132(e)(2), and nothing in the statute makes that choice invalid. Accordingly, we hold that the plan's forum-selection clause is enforceable." [In re Mathias, No. 16-3808 (7th Cir. Aug. 10, 2017)] (U.S. Court of Appeals for the Seventh Circuit)
[Opinion] An Open Letter to the OMB: No Further Delays in the DOL Rule and Bice
"[A]ny arguments by the investment industry that the fiduciary duties imposed on broker-dealers and stockbrokers under the Rule and BICE are onerous and/or unfair are meritless, as those same duties have already been recognized by their own SRO, FINRA and its predecessor, the NASD.... The significant and irreversible damage that has already been done, and will continue to be done, by further delaying full implementation of the Rule and BICE has been documented by several independent research organizations." (The Prudent Investment Adviser Rules)
The Financial Impact of Student Debt on Working and Retired Americans (PDF)
47 pages. "This study includes an analysis of ... the significance of accumulated education debt for retirement security.... [An] increase in indebtedness during a person's working life can be expected to reduce the wealth he will have accumulated by the time he retires.... The report makes illustrative calculations to determine the impact on annual personal expenditure under a range of assumptions about the debt burden, interest rates, and salary growth." (Society of Actuaries)
These Five Retirement Issues Brought Out the Lobbyists
"[D]espite the intense U.S. political debates occurring around retirement, lobbyists overall spent 15 percent less this quarter than last, the lobbying data indicate. The fiduciary rule, multiemployer reform, retirement issues relevant to tax reform, repeal of state retirement plans, and Pension Benefit Guaranty Corporation premiums were the top topics, in terms of number of lobbyists weighing in on them in the second quarter." (Bloomberg BNA)
[Opinion] Investors Will Win If SEC Swiftly Adopts -- and DOL Recognizes -- Best-Interest Standard for Brokers
"ICI advocates that the SEC take the lead by adopting a new, clearly defined best-interest standard of conduct for SEC-registered brokers that enhances the current 'suitability' standard and other obligations that apply to brokers under federal securities laws and FINRA rules.... The new SEC standard that ICI recommends ... enhances the suitability standard to provide an explicit duty of care and duty of loyalty[.]" (Investment Company Institute [ICI])
[Opinion] IRI Comment Letter to DOL on Fiduciary Rule and PT Exemptions (PDF)
43 pages. "[IRI appreciates] the opportunity to provide these comments to the [DOL] in response to [its recent] request for information ... 71 percent of advisers are planning to stop providing advice to at least some of their current small accounts due to the risk and increased costs of the Rule; 35 percent will stop serving accounts under $25,000, and 25 percent will raise their minimum account thresholds.... [D]istributor members reported that approximately 155,000 of their clients have already been 'orphaned,' with far more accounts expected to be impacted as implementation of the Rule proceeds.... More than 60 percent of the participating distribution firms have, are planning to, or are considering exiting or deemphasizing target markets such as small IRA holders and small retirement plan sponsors." (Insured Retirement Institute [IRI])
How America Dug a $375 Billion Pension Hole
"The vast majority of S&P 500 companies don't have enough money set aside to meet all their obligations to current and future retirees. There's a total gap of at least $375 billion for the 200 largest plans. This is how they got here." (Bloomberg)
West Wing Revolving Door and Retirement Plan Ideas Floating in D.C.
"The White House's legislative affairs director, Marc Short, just announced the timeline for tax reform ... the House is to pass the bill in October and the Senate is to pass it in November so it will be ready for the President's signature.... [Y]ou can bet that there will be thoughts about retirement plans because those rules have been adjusted by Congress over the years to adjust tax revenues as well as for retirement plan policy." (Winstead PC)
[Opinion] Regulatory Burdens Threaten Retirement Plans
"ERIC's comments to the Dept. of Treasury focused on four areas: Withdrawing proposed rules on minimum present value requirements for defined benefit plan distributions; Advocating for further delay on implementation of rules regarding nondiscrimination testing relief for closed defined benefit pension plans and requesting additional changes to such rules before being finalized; Calling for additional review and economic analysis of proposed regulations to update mortality tables used for determining the present value of accounts under defined benefit pension plans; and Review of foreign bank and financial report rules that apply to retirement plans in an effort to reduce costs and burdens on the retirement plan community and corporate treasury staffs." (The ERISA Industry Committee [ERIC])
Building a Strong Retirement Program: One for the 'AGES' (PDF)
"The Forward Thinking Task Force of the American Academy of Actuaries developed the Retirement for the AGES framework to provide a straightforward and unbiased way to assess and compare different retirement security proposals.... The AGES assessments [on these principles: Alignment, Governance, Efficiency, and Sustainability,] reveal how difficult it is to design an ideal retirement program that would balance many competing needs and objectives. They also show that it is possible to improve on the current system" (Benefits Quarterly, published by the International Society of Certified Employee Benefit Specialists [ISCEBS])
ERISA Advisory Council to Meet August 22-24
"[T]the 187th open meeting of the Advisory Council on Employee Welfare and Pension Benefit Plans (also known as the ERISA Advisory Council) will be held on August 22-24, 2017.... The Advisory Council will study the following topics: [1] Reducing the burden and increasing the effectiveness of mandated disclosures with respect to employment-based health benefit plans in the private sector, and [2] Mandated disclosure for retirement plans -- enhancing effectiveness for participants and sponsors." (Employee Benefits Security Administration [EBSA], U.S. Department of Labor [DOL])
Legal or Not, States Forge Ahead with 401(k)-for-Everyone Plans
"While the vast majority of small-business owners support the idea of offering auto-IRAs to their employees, most oppose the plans being sponsored and administered by the state or the federal government ... Seemingly, the negative news regarding many governments' growing public pension liabilities has cast a cloud over states getting involved in any kind of new retirement plan -- even one where the state has no liability.... But many feel this perception problem can be fixed." (Governing)
Treasury to Cut Obama-Backed Retirement Savings Program
"This is the third Obama administration retirement-related initiative that the Trump administration has tried to ax or soften, along with the state- and city-run retirement savings program regulations and the DOL's fiduciary rule.... At the end of 2016, just 20,000 myRA accounts had been opened, with assets of about $17 million." (Bloomberg BNA)
Legal Fight to Stop DOL Rule Returns to Court
"Arguments will be heard by a three-judge panel [in the Fifth Circuit Court of Appeals on Monday, July 31].... The industry plaintiffs are consolidated from three lawsuits that were filed last summer in U.S. District Court for the Northern District of Texas. While the plaintiffs lost the federal court decisions, the Dallas court was chosen specifically because appeals would go to the Fifth Circuit. The Fifth Circuit is generally considered the most conservative in the country, with decisions that frequently define the government's role narrowly." (InsuranceNewsNet.com)
[Official Guidance] Treasury Announces Steps to Wind Down myRA Program
"The U.S. Department of the Treasury today announced that it will begin to wind down the myRA program after a thorough review by Treasury that found it not to be cost effective. This review was undertaken as part of the Administration's effort to assess existing programs and promote a more effective government. Demand for and investment in the myRA program has been extremely low. American taxpayers have paid nearly $70 million to manage the program since 2014.... Participants in the myRA program are being notified of the upcoming changes, including information on moving their myRA savings to another Roth IRA." (U.S. Department of the Treasury)
[Opinion] Secure Choice 2.0: States Blazing a Path to Retirement Security for All (PDF)
36 pages. "Secure Choice is a direct outgrowth of persistent and converging trends that are reshaping the retirement landscape -- trends that include the diminution of traditional defined-benefit pension plans and the failed promise, for many Americans, of the much-vaunted 401(k) plan. This paper revisits these and other forces that have given rise to a wave of state initiatives to help Americans retire with dignity. It examines what has happened since the earlier white paper was issued, takes stock of developments at the state level, and looks at the challenges ahead." (National Conference on Public Employee Retirement Systems [NCPERS])
Father of the 401(k) Designs Cheaper Retirement Plan
"Employees covered by small-business retirement plans typically pay between 1.5 percent and 2.75 percent annually in fees -- many of which are hidden and hard to understand.... [Ted Benna] has drawn up three new retirement-savings models that he contends offer the same benefits as a traditional 401(k). One is best suited for married employees with less than $100,000 of adjusted gross income and single employees with less than $62,000 of adjusted gross income. Another avoids the payroll taxes applicable to employer contributions. The third model allows employees to sock away pretax contributions of up to $12,500 under age 50 and $15,500 over age 50, compared with only $5,500 and $6,500 for some other models." (The Gazette)
[Opinion] Public Pensions Are Under Attack in Iowa
"Each year IPERS pumps $1.8 billion into the Iowa economy through modest benefits that average $16,000 annually. This is economic activity that should not be underestimated in a small, mostly rural state like Iowa. As Iowa's population continues to shift from rural areas to larger cities, those small towns will find that they rely on the spending of pension benefits by retirees to stimulate local economies. Republican political leaders in Iowa appear to be laying the groundwork to attack and possibly eliminate IPERS." (National Public Pension Coalition)
[Official Guidance] Text of Treasury Department Letter Approving United Furniture Workers 'Pension Fund A' Application to Reduce Benefits (PDF)
On July 20, 2017, the Board of Trustees of the United Furniture Workers Pension Fund A (Fund) was notified that its second application to reduce pension benefits under MPRA was approved by Treasury. As a result, the proposed benefit reductions will now be subject to a vote of participants and beneficiaries of the Fund. Ballots will be mailed to participants and beneficiaries on or around August 1, 2017. (U.S. Department of the Treasury)
Workplace Retirement Savings and State Plan Mandates: Employer and Employee Perspectives (2017)
"In theory, many workers support the notion of government-mandated retirement savings, but their confidence in the ability of governmental entities to administer such programs is lower than in any other listed entity. Many employers say that they would be very likely to discontinue their Defined Contribution plan in favor of a government solution, but just as many say that they would not be very likely to do so.... Workers value many aspects of DC plans that will likely not be part of state-mandated solutions." (LIMRA)
Newborns Would Save $2.2 Million for Retirement with This Idea
"Any adult would be permitted to make tax-deductible contributions to any child's account, whether family, friend or stranger. Each minor would be able to receive a maximum $1,000 yearly, but contributors could spread a greater amount across multiple accounts. [The] idea also calls for the Child IRA converting to a traditional one at age 19, subject to current law. This means that additional contributions -- 2017's limit is $5,500 for people under age 50 -- would lead to even higher account balances in retirement." (CNBC)
Committee Approves Legislation to Repeal Fiduciary Rule, Strengthen Protections for Retirement Savers
"[T]he House Committee on Education and the Workforce ... approved the Affordable Retirement Advice for Savers Act (H.R. 2823).... [T]he legislation protects access to affordable retirement advice by overturning the Obama administration's fiduciary rule while requiring retirement advisors to serve the best interests of their clients." Also available: [1] fact sheet, [2] bill summary, and [3] more information on the markup. (Committee on Education and the Workforce, U.S. House of Representatives)
[Opinion] American Benefits Council Letter to Senate Finance Committee: Successful Employer-Sponsored Benefits System Depends on Smart, Forward-Thinking Tax Policy
"[T]he tax incentives for health and retirement plans are typically scored as the largest income tax expenditures in the federal budget ... [T]he tax 'expenditure' for employer-provided health plans -- attributable to the exclusion of employer contributions from individuals' income and payroll tax -- is a relative bargain compared to the enormous federal expenditures on the Medicare and Medicaid programs, even though employer plans offer far superior coverage.... Second, the tax 'expenditure' for employer-provided retirement plans is not actually an expenditure at all -- it is a tax deferral." (American Benefits Council)
The Small Business Retirement Savings Challenge (PDF)
"91% of small employers without a plan would be at least somewhat more likely to start a plan if the cap on the current tax credit for starting a plan were increased to $5,000 ... and adjusted to cover all initial costs.... 86% of small employers with a plan would be at least somewhat more likely to offer automatic enrollment if they were eligible for a $500 credit for doing so[.]" (LPL Financial)
[Opinion] ARA Comment Letter to DOL on Fiduciary Rule and Related Exemptions (PDF)
12 pages. "The ARA recommends a delay of the January 1, 2018, applicability date for certain provisions of the Best Interest Contract Exemption, the Principal Transaction Exemption, and amendments to PTE 84-24 ... [An] extension would reduce unnecessary burdens on financial service providers and pose minimal risk to the interests of retirement investors.... The ARA recommends an alternative streamlined exemption (the 'Levelized Fee Exemption') that would remain protective of the Interests of Retirement Investors while greatly reducing the regulatory burden imposed on Financial Institutions and Retirement Investors. The Levelized Fee Exemption would more broadly encompass the wide range of 'levelization' processes in use across the retirement marketplace and further continuing innovation is this area." (American Retirement Association [ARA])
[Opinion] The 'Pension Crisis' Is a Myth, Part Two
"[This article addresses] the question of unfunded liabilities in public pension plans and why pension critics typically misrepresent the truth about unfunded liabilities to promote their false pension crisis narrative. Pension critics also ignore the shocking unpreparedness of most Americans for retirement, which could be improved if more people were covered by pensions." (National Public Pension Coalition)

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