Retirement Plans Newsletter

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Webcasts and Conferences

How Financial Advisors Can Ensure Compliance with the DOLís Fiduciary Rule
August 1, 2017 WEBCAST
Bloomberg BNA

Intermediate IRA Training Part 1
August 15, 2017 WEBCAST
Wolters Kluwer

Fundamentals Series 02: Vesting [2017]
September 19, 2017 WEBCAST
FIS Relius Education

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Interesting Angles on the DOL's Fiduciary Rule, Part 56
"The benefits of increased contributions are so obvious, and the potential conflict is so small, that the easiest, and most direct, solution would be for the DOL to conclude that a recommendation to make or increase contributions is not fiduciary advice. However, if the DOL doesn't do that, it should follow through with ... a streamlined exemption for contribution recommendations."


SALGBA National Conference for public sector benefit professionals

Sponsored by SALGBA [State and Local Government Benefits Association]

The SALGBA National Conference will be held April 29 Ė May 2, 2018 in Jacksonville, FL. More information please visit

PBGC to Look at New Arbitration Rules (PDF)
"The Trump administration has set on its regulatory agenda a new proposed [PBGC] rule that will make changes to the arbitration procedures for employers that withdraw from multiemployer pension plans.... The Trump administration's regulatory agenda, released July 20, also indicates that the PBGC will propose a rule that will make changes to the reporting, disclosure, and valuation for certain terminated or insolvent multiemployer plans."
Bloomberg Law Pension & Benefits Daily, via Keightley & Ashner LLP

Penalties Hit ERISA Plans in Spite of CPA Audits
"While the number of filing deficiencies are frequent among smaller plans (i.e., plans with fewer than 100 participants), which aren't required to have an annual CPA's independent financial audit, the DOL is concerned about the increasing number of deficiencies it sees for plans that receive a CPA's annual financial audit.... [D]eficiencies ... include: [1] Incorrect payroll calculations; [2] Failure to properly synchronize changes in participants' deferral rates with the recordkeeper; and [3] Recordkeepers' vesting errors on distributions."

Fifth Circuit Hears Latest Round of Fiduciary Rule Arguments
"At least one judge on the three-judge panel that has been assigned to the case seemed to have little sympathy for the basic strokes of the DOL's arguments.... Judge [Edith] Jones asked a number of questions about prohibited transaction exemptions that already existed prior to the ongoing fiduciary standard expansion -- about how these exemptions speak of the difference between sales interactions and investment advice."

Target Date Fund Landscape Shifts as Plan Sponsors Choose Non-Proprietary Solutions
"Recordkeepers' proprietary target-date fund share has declined by 16% since 2009, as the use of non-proprietary solutions from other asset managers has increased by 16%. Use of collective investment trusts (CITs) has gained in DC plans as providers look to reduce fees. Large DC plans are leading the shift to non-proprietary target-date funds."
AllianceBernstein and BrightScope


Reforms, Regulations & Retirement Realities

Sponsored by ASPPA

This October the nation's retirement industry elite will converge at ASPPA Annual, in our nation's capital, with insights from industry insiders, regulators, pundits and the nation's leading voices. Join us!

Leading Advisers and 401(k) Plan Sponsors Use Goal-Oriented Targets to Replace Outdated Modern Portfolio Theory Risk Tools
"The [goal-oriented target (GOT)] is a number, but it's a number based not on investment returns, investment risk, or any other of the myriad of MPT-based statistics. It doesn't rely on complex 'Monte Carlo'-type analyses best confined to think tank computers, not the smart phones used by everyday folk. All the numbers required for input represent real numbers specific to each retirement saver. They're easily accessible and just as easy to understand."
Fiduciary News

Why Investors Need a Retirement Policy Statement
"The idea is to establish a set of guidelines so you'll know if you're on course or veering off the road. You suddenly hanker for a 40-foot motor home? Well, it shouldn't be an impulse buy -- get it only if it fits your spending rules. And decide whether you'll handle things on your own or get professional help for spotting opportunities and pitfalls"
U.S. News & World Report

Older Americans Aren't as Poor as We Thought
"Millions of American workers are frozen out of their companies' pension plans. Maybe you get a 401(k), if you're lucky. But the traditional pension is dead. Unless, perhaps, you're already retired. It still lives for millions of older Americans who worked and qualified for their pensions in another era. Today's retirees are living pretty well, new research finds -- much better than previously thought."

An Actuarial Perspective on the 2017 Social Security Trustees Report (PDF)
11 pages. "The combined Social Security trust fund reserves are projected to become depleted during 2034, the same year as projected in last year's report. If changes are not implemented by that date, only about 77 percent of scheduled benefits would be payable after 2034, declining to 73 percent in 2091.... To bring Social Security into actuarial balance for the next 75 years ... changes equivalent to either an immediate increase of 2.76 percentage points in the payroll tax rate, or an immediate decrease of about 17 percent of benefits for all current and future beneficiaries, or some combination thereof, is required."
American Academy of Actuaries

Public Pension Plan Investment Returns Are In for FY 2017
"The S&P 500 was up 15%, the Dow was up 19%, and NASDAQ was up 26%. Those 'expectations-breaking' public pensions returns don't look all that amazing now, do they?"

FAS87 ASC715 Discount Rates and Moody's Rates
Includes an unofficial monthly report as of July 31, 2017 of Moody's Daily Long-term Corporate Bond Yield Averages and Moody's Daily Treasury Yield Averages, used as benchmarks by some corporate pension plans.
David Rigby via BenefitsLink Message Boards

Pension Finance Update, July 2017
"Strong stock markets have buoyed pension sponsors this year, overcoming lower interest rates to produce improvements in pension funded status, and July saw a continuation of this trend. Both model plans ... enjoyed modest (less than 1%) improvement last month and remain in the black for the year so far. Traditional Plan A is now up more than 2% this year, while the more conservative Plan B is ahead 1% through the first seven months of 2017."
October Three Consulting

State and Local Pension Plan Funding Sputters in FY 2016 (PDF)
15 pages. "The aggregate funded status of state and local pension plans declined in fiscal year (FY) 2016, because liabilities continued to grow steadily while poor stock market performance led to slow asset growth. Thus, the ratio of assets to liabilities fell whether measured by the old Governmental Accounting Standards Board standard (GASB 25), which uses a smoothed value of assets, or by the new standard (GASB 67), which values assets at market. While the new standard has been in effect since 2014, most plans also still report numbers under the traditional rules.... [T]his brief provides a multi-year comparison of the two approaches."
Center for Retirement Research at Boston College


American Benefits Council Comments to DOL on Unwarranted and Harmful ERISA Breach of Fiduciary Duty Litigation (PDF)
10 pages. "In order to help reduce the negative impacts of unwarranted class-action litigation against employers that sponsor a retirement plan, and the service providers that assist them, we are asking the Solicitor of Labor to direct agency resources in a manner that would slow the proliferation of unwarranted and harmful litigation.... [T]he Office of the Solicitor of Labor could make a significant difference in reducing unwarranted litigation against retirement plan sponsors and service providers by filing amicus briefs where appropriate, including ... in opposition to class-action plaintiffs that do not satisfy the pleading standards necessary to survive a motion to dismiss for failure to state a claim under Federal Rule of Civil Procedure 12(b)(6)."
American Benefits Council

Discussions on
the BenefitsLink Message Boards

Using Integrated Formula Instead of Cross Testing
"I have a safe harbor new comparability plan. They are unable to pass average benefits test due to one of the owner's 90% deferral rate. Therefore new comparability isn't working. Can we shift to an integrated format and bypass the average benefits test? We pass coverage, etc."
BenefitsLink Message Boards

Hardship Distribution for Home Purchase, Then Deal Falls Through
"Participant legitimately requested a hardship withdrawal, had all proper paperwork, etc. -- the check was issued, cashed and deposited, and now the deal has fallen through at the closing. Participant wants to know if the funds can be contributed back into the plan."
BenefitsLink Message Boards

Lost Earnings on 401(k) for Late Pay?
"HR noticed they missed paying an employee a few vacation days in a paycheck issued a few months ago. When the employee is issued a payment for the vacation days, would the 401(k) elective deferrals that otherwise would have been withheld from the vacation pay be considered 'late,' such that correction of this situation requires the plan sponsor to contribute the lost earnings on the missed elective deferrals? The amount of the missed elective deferrals will be withheld and deposited when the employee is issued a payment for the vacation days."
BenefitsLink Message Boards

Press Releases

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BenefitsLink Retirement Plans Newsletter, ISSN no. 1536-9587. Copyright 2017, 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, Inc., or in the case of third party materials, the owner of those materials. You may not alter or remove any trademark, copyright or other notices from copies of the content.

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