Retirement Plans Newsletter

March 10, 2016

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Employee Benefits Jobs

Senior Pension Benefits Analyst
Willis Towers Watson
in CO, MA, MI, PA, TX

Pension Consultant
Willis Towers Watson
in CO, MA, MI, PA, TX

Senior 401(k) Plan Administrator
ERISA Services, Inc.
in TN

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Webcasts and Conferences

How a Fiduciary Standard and the 2016 Elections Could Change Your World
March 22, 2016 WEBCAST
(InvestmentNews)

Health Benefits Laws Compliance Assistance Seminar
April 19, 2016 in AZ
(Employee Benefits Security Administration [EBSA], U.S. Department of Labor)

Best Behavioral Practices in 401(k) Plan Design
April 21, 2016 in TX
(ASPPA Benefits Council [ABC] of Dallas/Fort Worth)

SALGBA 2016 National Conference
April 24, 2016 in TX
(State and Local Government Benefits Association [SALGBA])

2016 IRA BootCamp
April 25, 2016 in VA
(PenServ Plan Services, Inc.)

SPARK National Conference
June 19, 2016 in DC
(SPARK Institute)

Benefit Communication and Technology Institute
July 18, 2016 in MA
(International Foundation of Employee Benefit Plans [IFEBP])

62nd Annual Employee Benefits Conference
November 13, 2016 in FL
(International Foundation of Employee Benefit Plans [IFEBP])

View All Webcasts and Conferences


Discussions


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[Guidance Overview]

Nondiscrimination Testing Changes for Pension Plans (PDF)
"The proposed changes provide testing relief for frozen plans.... [T]he proposed changes may allow some sponsors who rely on testing their DB and DC plans together to lower DC plan contributions to non-highly compensated employees (NHCEs).... [W]hile current regulations allow providing higher benefits to HCEs if certain nondiscrimination tests are met, the proposed changes may limit this ability in some circumstances." (Ekon Benefits)  


[Advert.]

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IRS Publication 3998: Choosing a Retirement Plan for Your Small Business (PDF)
8 pages, Oct. 2015 revision date. Includes descriptions of various types of retirement plans and a fairly detailed comparison chart. (Internal Revenue Service [IRS] and Employee Benefits Security Administration [EBSA], U.S. Department of Labor [DOL])  

Automating 401(k) Investing
"A 2015 study of ... found that almost four out of 10 [plan sponsors] thought participants invested too conservatively, and only 42% said their participants were on track for a financially secure retirement. Now one of the robo-advisers that provide online portfolio management for individual investors has moved into the 401(k) space to help employees with their asset allocation decisions. It remains to be seen whether this innovation will take off in 401(k) plans." (Treasury & Risk)  

Managed Account Adoption Grows as Employees Recognize Value of Professional Help Amid Market Turmoil
"[A]lmost two-thirds (57 percent) of companies said that workplace managed accounts were 'very important' to help employees prepare for retirement, while 53 percent said the service ensures employees are investing their retirement savings appropriately.... About half (48 percent) of managed account users said that the ongoing monitoring of their investments was one of the most valuable things about the offering. Forty-four percent the said that the annual review was essential and 38 percent said that ongoing management was beneficial, as well." (Fidelity)  

Public Pension Plans Need Governance Fixes
"Better public pension plan board governance can help improve the poor condition that many of the nation's state and municipal public pension plans are in, scholars with the Manhattan Institute for Policy Research Inc. said ... Weaknesses among the boards include having the wrong composition of members and 'weak, if any, fiduciary duties,' [one author] said." (Bloomberg BNA)  


[Advert.]

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Last-Minute IRA Contributors: Ten Mistakes to Avoid
"[1] Making the wrong contribution type.... [2] Not splitting between contribution types if you're not sure.... [3] Assuming IRA choice is irrevocable.... [4] Making a traditional nondeductible IRA contribution and leaving it be.... [5] Executing a backdoor Roth with other taxable IRA assets in the picture.... [6] Not being deliberate about the backdoor conversion.... [7] Forgetting about spousal contributions.... [8] Misunderstanding the rules about IRA contributions later in life.... [9] Not using your IRA to address portfolio issues.... [10] Not taking advantage of the IRA's tax-saving features." (Morningstar)  

Did You Contribute Too Much to a Roth IRA?
"Here are your choices if you contributed to a Roth IRA and then found out later that you were ineligible for the contributions because you made too much money in the year of contribution: [1] Do nothing and pay the 6% penalty ... per year ... [2] Withdraw the money.... [3] Re-characterize the money.... [4] Avoid this hassle next year." (Financial Finesse)  

Colorado Senate Passes Bill Requiring Retirement System to Divest Companies Boycotting Israel
"HB 1284 calls for the Denver-based retirement system to identify international companies with economic prohibitions against Israel in which it has direct investments by Jan. 1, 2017, and under certain circumstances, withdraw from those investments. Companies would be given an opportunity to cease their prohibitions against Israel before funds are withdrawn." (Pensions & Investments)  

Florida Legislation Allowing Jacksonville to Impose Sales Tax to Address Pension Underfunding Goes to Governor for Signature
"Thirty-five senators voted for House Bill 1297, which allows Jacksonville residents to decide whether to create a half-cent sales tax to pay down pension debt.... Jacksonville's total pension debt for its three plans is a whopping $2.87 billion. The Police and Fire Pension Fund only has enough on hand to pay 43 percent of future pension obligations over the next 30 years, leaving it $1.8 billion in the hole. The General Employee Pension Plan is 66 percent funded with a debt of $910 million. The Corrections Officers Pension Plan is 48 percent funded with debt of $157 million." (jacksonville.com)  

[Opinion]

New York City Proposes Its Own Private-Sector Retirement Plan, Making a Bad Idea Even Worse
"Apart from the clear track record that having municipality oversight of private sector employee retirement funds opens the door for corruption and abuse, the entire structure of such a program flies directly in the face of the very reasons why [ERISA] was signed into law over 40 years ago. ERISA exists to protect workers and provide a federal preemption in order to insure uniformity in retirement plan structure across the country." (The Platinum 401k, Inc., via LinkedIn Pulse)  

[Opinion]

ICI Comments to OMB on Regulatory Impact Analysis Supporting Final DOL Fiduciary Rule (PDF)
"The Department's claims that broker-sold funds 'underperform' are not supported by the very academic studies on which it relies.... Investors' actual experience with broker-sold funds contradicts the Department's claims.... The Regulatory Impact Analysis ignores the cost of investment advice.... The Regulatory Impact Analysis fails to account for the societal harm of investors losing access to advice and guidance.... The Regulatory Impact Analysis fails to meet the minimum standards applicable to agency rulemaking." (Investment Company Institute [ICI])  

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BenefitsLink Retirement Plans Newsletter, ISSN no. 1536-9587. Copyright 2016 BenefitsLink.com, Inc. All materials contained in this newsletter are protected by United States copyright law and may not be reproduced, distributed, transmitted, displayed, published or broadcast without the prior written permission of BenefitsLink.com, Inc., or in the case of third party materials, the owner of that content. You may not alter or remove any trademark, copyright or other notice from copies of the content.

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