Retirement Plans Newsletter

January 29, 2019 logo logo
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Webcasts, Conferences

Getting It Right - Know Your Fiduciary Responsibilities Seminar
March 5, 2019 in CA
Employee Benefits Security Administration [EBSA], U.S. Department of Labor

2019 NIPA Annual Forum & Expo (2019NAFE)
April 28, 2019 in CA
NIPA [National Institute of Pension Administrators]

►See 166 Upcoming Webcasts and Conferences

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The Digital Fiduciary: Overseeing Retirement Plans in the Digital Age (PDF)

17 pages. "In the 20th century, overseeing an employee retirement plan meant having a deep knowledge and expertise of investing and plan design. In the 21st century, it is essential for plan sponsors to add effective digital design to their skill set.... [E]ven minor changes to the online experience of participants -- such as increasing the number of lines on a website, or changing the frequency of account feedback -- can have a large and lasting impact on their financial success."


ASC CE Webcast: New Hardship Distribution Rules for 401(k) Plans

Sponsored by ASC

Review the new IRS recently proposed regulations which have a major impact on 401(k) plan compliance and operation. Topics include new hardship distribution events, elimination of the 6-month suspension and loan requirements, and more. Register Now!

The Secret to Winning a Fiduciary Lawsuit

"Traditional risk management programs for ERISA rely heavily on operating levers with vendors for compliance assurance.... The Court's ruling in the American Century case demonstrates how critical a 'prudent process' can be in fending off breach of fiduciary duty lawsuits. Employers will find it difficult to operate safely in today's rough and tumble litigation era without assessing their ERISA plan oversight programs."

The Importance of Fiduciary Training

"[T]he DOL views fiduciary training as a critical element of prudent oversight and is increasingly looking for evidence that fiduciary training has been provided during plan audits. Unfortunately ... [a 2017 survey of plan sponsors] found that nearly 70% had not received any formal fiduciary training.... So, what topics should be covered?"
Greenspring Advisors

Second Circuit Opens Potential ERISA Avenue for Plaintiffs in 'Stock Drop' Lawsuits

"[T]he United States Court of Appeals for the Second Circuit issued a rare procedural victory to 'stock drop' plaintiffs by reversing and remanding a district court's dismissal of a lawsuit against IBM. The court held that the plaintiffs sufficiently pleaded a prudence claim that relied upon corrective disclosure as a viable alternative course of action for the fiduciaries." [Jander v. Ret. Plans Comm. of IBM, No. 17-3518 (2d Cir. Dec. 10, 2018)]
Groom Law Group

4th Quarter Fallout: Mistakes 401(k) Participants Might Make After Reading Their Latest Statement

"The 4th quarter devastated the markets.... When employees see their losses, they may decide to 'fix' the 'problem.' This could be the worst mistake they can make regarding their retirement.... 'Going ostrich' worked following the 2008/2009 market debacle. It turned out the people who decided not to open their statements recovered faster than the people who did do better and decided to switch to 'safe investments.' "
Fiduciary News


Managing your 401(k) Plan: A Day in the Life of a Healthy 401(k)

Sponsored by Lorman and BenefitsLink

Feb. 7 webinar. Ensure all parties are fulfilling their obligations under ERISA and that your organization's 401(k) program is running smoothly. BenefitsLink discount.

Market Volatility for Retirement Plan Participants

"[T]he average person with a retirement account ... should be thinking more about their overall asset allocation than the individual funds they hold.... It's a common psychological pitfall to feel that you are protecting yourself by exiting a market as it goes down, but ... when people take money out of the market, the timing is unlikely to be favorable, causing them to miss out on the upswing as the market corrects."
Bronfman Rothschild

Target Date Fund Performance in 2018 (PDF)

"The average TDF, as measured by the S&P TDF indexes, lost 3% for current retirees, 6% for those who are retiring in 2030 and 8% for those who are retiring 31 years from now in 2050. The median fund lost a little more than the average fund."
Target Date Solutions

The SEC's Best Interest Proposal for Advice Given by Broker-Dealers (PDF)

"The SEC's new 'best interest' proposal would require a broker-dealer 'to act in the best interest of a retail customer when making a recommendation of any securities transaction or investment strategy involving securities to a retail customer.' ... This [article] provides background on the proposed rule and describes the policy debate surrounding the rule. SEC Chairman Jay Clayton has announced that completing the rule will be a key priority for the SEC during 2019."
Congressional Research Service [CRS]

Metlife to Pay $189 Million to Policyholders for Pension Failures

"MetLife Insurance Company ... will pay a penalty of $19.75 million for failing to properly locate and pay benefits to thousands of New York insureds and beneficiaries.... MetLife will also pay retroactive benefits to policyholders in New York State and elsewhere totaling more than $189 million. The insurer has already paid $123 million of the approximately $189 million to consumers whose group annuity benefits had been lost or delayed[.]"

Pension Lump Sums Less Expensive in 2019

"The lump sum mortality basis changed substantially in 2018, but there's only a minor update in 2019.... It's unclear which direction interest rates will move during 2019.... In addition to lump sum payout programs, plan sponsors should consider annuity purchases and additional plan funding as ways to reduce long-term plan costs/risks."
Van Iwaarden Associates

SOA's New Mortality Tables May Not Affect Large Public Retirement Systems

"The new mortality tables may have a bigger impact on small public retirement systems which do not have much credible experience which actuaries can use to adjust the mortality tables. Nonetheless, the actual impact of these new tables on liabilities and on contributions will vary depending on the extent to which each system has already adjusted the mortality assumptions from the previous tables."

GAO Report on Retirement Security: Alternate Price Indexes for Cost-of-Living Adjustments Present Tradeoffs

"This report provides information on the benefits and disadvantages of alternate price indexes for measuring the cost of living for older Americans.... Using an alternate index would likely result in changes to benefits and program costs that accumulate over time.... Changing to an alternate index would have the largest relative effect on those who receive benefits the longest and those with lower incomes ... Implementing an alternate index could pose issues regarding timeliness of data and cost." [GAO-19-218R, Jan. 28, 2019]
U.S. Government Accountability Office [GAO]

Selected Discussions
on the BenefitsLink Message Boards

Required Changes in Assumptions for 2018 Beginning of Year Valuations?

Did the IRS issue some sort of guidance or notice in 2017 effective for 2018 that restricted what assumptions could be used in a beginning of year valuation? Specifically did they state that for a participant you must assume 2018 expected compensation and expected hours must be the actual 2017 compensation and hours?
BenefitsLink Message Boards

Correction of 415 Violations by Making In-Service Distributions

We have several active DB plan participants (who are NOT highly-paid) who are over 70-1/2, continuing to work full-time, and whose accrued benefits have exceeded section 415 limits. We've been advised by our attorneys that the appropriate way to handle this is to begin periodic payments, even though the participants continue to work. Could someone provide a little history on this and direct me to the appropriate regs?
BenefitsLink Message Boards

Catch Up Contributions Mistakenly Not Made

Participant enrolled and deferrals withheld and timely deposited. In September the employee reached $18,500. Payroll stopped his deferral. The participant was over 50. Due to a payroll glitch, the catch up contributions were not withheld. In January the employer realized the error. They have corrected the payroll issue. Any action required by the employer for these "missed" deferrals? The employer does not make a match contribution.
BenefitsLink Message Boards

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BenefitsLink Retirement Plans Newsletter, ISSN no. 1536-9587. Copyright 2019, 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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