Retirement Plans Newsletter

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Dresher PA

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Webcasts, Conferences

Millennial State & Local Government Employee Views on Their Jobs, Compensation & Retirement
February 13, 2020 WEBCAST
National Institute on Retirement Security

Step 4 of the Fiduciary Process: Monitoring the Client Engagement
February 20, 2020 WEBCAST

Breaking Down the SECURE Act's Impact on DC Retirement Plans
February 26, 2020 WEBCAST
Multnomah Group

Understanding Earned Income
March 4, 2020 WEBCAST
ASPPA [American Society of Pension Professionals & Actuaries]

What To Do When Culture Sucks
March 4, 2020 in OH
Worldwide Employee Benefits Network [WEB] - Greater Cincinnati Chapter

Annual Legal & Regulatory Update
March 12, 2020 in OH
Worldwide Employee Benefits Network [WEB] - Northeast Ohio Chapter

ERISA Plan Investments in the Financial Markets 2020: The Fundamentals
March 16, 2020 WEBCAST
Practising Law Institute

FAQs on the SECURE Act
March 18, 2020 WEBCAST
ASPPA [American Society of Pension Professionals & Actuaries]

Understanding 401(k) Plan Automatic Enrollment
April 7, 2020 WEBCAST
Lorman Education Services

Pension Plan Investments 2020: Current Perspectives
May 4, 2020 WEBCAST
Practising Law Institute

ERISA Basics National Institute
June 15, 2020 in DC
American Bar Association Joint Committee on Employee Benefits [JCEB]

►See 115 Upcoming Webcasts and Conferences

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[Official Guidance]

Text of Treasury Department Letter Approving Composition Roofers Local 42 Pension Plan Application for Reduction of Benefits (PDF)

"Treasury has determined that the Plan is eligible to reduce benefits under MPRA and that your application satisfies the requirements of ... section 432(e)(9) ... as added by MPRA. This notification is not a final authorization to implement the benefit reduction described in your application.... [N]o reduction of benefits can take effect before a vote of the participants and beneficiaries of the Plan with respect to the proposed reduction."

U.S. Department of the Treasury

Let Participants Know About Birth and Adoption Expenses Withdrawals

"The SECURE Act amends the tax code to add exception from the 10% early distribution tax: any qualified birth or adoption distribution up to $5,000.... If you have multiple plans will need to make sure that an employee is not allowed to exceed the $5,000 limit by withdrawing from more than one plan.... This distribution under this provision may be allowed regardless of whether other in-service distributions are allowed under your plan."

The Rosenbaum Law Firm, P.C.

Supreme Court Refuses to Hear Brotherston v. Putnam

"[This article reviews] the First Circuit's decision, the Solicitor General's brief to the Supreme Court arguing that the First Circuit decision should not be reviewed, defendant Putnam's arguments for review, and the significance -- for ongoing litigation -- of the Supreme Court's decision not to review.... [As] defendant Putnam argued in its briefs to the Court, ... the issue of what is a 'suitable comparator' is going to continue to be especially problematic for plan sponsors in ongoing 401(k) prudence litigation." [Brotherston v. Putnam Investments, LLC, No. 17-1711 (1st Cir. Oct. 15, 2018; cert. pet. denied Jan. 13, 2020, S. Ct. No. 18-926)]

October Three Consulting

401(k) Lawsuit Ruling Sends Principal Back to Court

"[A] three-judge panel of the Court of Appeals for the 8th Circuit wrote that the lower District Court erred when it found that Principal was not a fiduciary to an employer-sponsored plan that used the Principal Fixed Income Option. The opinion contrasts with earlier decisions in the 10th Circuit in a similar case against Great-West Life & Annuity Ins. Co., though the 8th Circuit extensively cited that case law in its order." [Rozo v. Principal Life Ins. Co., No. 18-3310 (8th Cir. Feb. 3, 2020)]

InvestmentNews; subscription may be required

Fiduciary Considerations for Defined Contribution Retirement Plans

"[This] checklist can help fiduciaries evaluate and correct some of the issues that were addressed in [recent] lawsuits. [1] Evaluate the balance of active and passive investment options.... [2] Analyze fee structure.... [3] Assess the number of investments options being offered.... [4] Simplify recordkeeping.... [5] Do regular checkups."


Lingering Shadow of 2018's Debacle Hurts Retirement Fund Growth

"Assets of the 1,000 largest U.S. retirement funds increased to $11.32 trillion in the year ended Sept. 30 at a slower pace -- 2.9% -- than in 2018 when assets grew by 6.4%, due to the lingering effect of poor market performance in the fourth quarter of 2018. Over the five years ended Sept. 30, asset growth of the combined defined benefit and defined contribution plans of the 1,000 largest retirement funds was 25%, lagging the 31.8% increase over the same time frame ended Sept. 30, 2018[.]"

Pensions & Investments

Fixed Income Increases as More Pension Plans Shed Risk

"Defined benefit plans shifted more of their overall portfolios into fixed income during the year ended Sept. 30 ... This likely served investors well as bond indexes were simultaneously up about 10% during that time. The DB plans of the 200 largest U.S. plan sponsors, in particular, sought to derisk and increased allocations to liability-driven investment strategies, and also targeted higher income, reporting more assets in private credit and emerging market debt[.]"

Pensions & Investments

Editor's Pick Survey Finds High Anxiety Among 'Pre-Retirees'

"Most pre-retirees consider managing retirement income more overwhelming than many other financial moments typically considered stressful ... [P]eople within five years of retirement are unfamiliar or worried when it comes to some important basics about retirement income, which may add to their stress level: [1] Annual Required Minimum Distributions (70% know nothing / not a lot about this topic); [2] Tax implications of retirement account withdrawals (70% know nothing / not a lot about this topic); [3] Fees (48% are worried about paying too much for advice on managing retirement income)."

Charles Schwab

Global Pension Assets Study 2020

"Assets in the 22 largest pensions markets (P22) increased by 15% over the year, with Mexico, Canada and the US leading the way in terms of growth (22.2%, 18.9% and 17.8% respectively) ... Last year, total Defined Contribution (DC) assets across the aggregate of the six largest pension markets in the world exceeded Defined Benefit (DB) assets for the first time.... In 2019 there was a noticeable pick-up in the decade's trends in organisational design towards a stronger 'people model' (the combination of people employed by the fund's board and internal team, with reference to talent, roles, and delegations).... 2020 signals the start of a decade where the pursuit of purpose has become more widely entrenched and influential."

Willis Towers Watson

Pensions Love Alternative Investments More Than Ever

"For all the expense and complexity that it takes to build their holdings, global pensions are losing out to a portfolio that they could implement in a day. But pension funds remain committed to increasing their exposure to private equity, real estate, and other alternatives, according to a new report from Willis Towers Watson's Thinking Ahead Institute."

Institutional Investor

January's Discount Rate Hits 20-Year Record Low, Dropping Corporate Pension Funding Significantly

"January’s poor funding performance is the result of a 35-basis-point drop in the monthly discount rate, from 3.20% in December to 2.85%, setting the record for the lowest rate ever recorded in the 20-year history of the PFI, and only the second time the PFI’s monthly discount rate has dropped below 3.00%. Pension liabilities increased by $87 billion in January as a result, with the losses only partially offset by strong investment gains of $14 billion."

Milliman Retirement Town Hall

How Do Children Affect the Need to Save for Retirement?

"For households who had children, expenditures from ages 65 through 69 are 3 percent lower than from ages 45 to 49, while for childless households expenditures rise 33 percent from ages 45 to 49 through ages 65-69. Similarly, parental household expenditures at age 65-69 are equal to about 80 percent of earnings from ages 45-49, versus 94 percent for nonparental households. These life cycle expenditure patterns appear sufficiently distinct that both households planning for retirement and analysts evaluating the adequacy of household retirement saving should consider the presence of children in the household as a factor affecting the wealth necessary for retirees to maintain their pre-retirement standard of living in retirement."

Andrew G. Biggs, via SSRN

Debt vs. Retirement: How to Choose Where to Put Your Money

"Ideally, with enough money coming in, you should try to continue paying down the debts and contributing to your retirement account.... [T]he answer ... depends on a lot of things: your age, the amount of debt, how expensive it is to carry the debt and if your employer is offering a match for your retirement contributions."

The Washington Post; subscription may be required


Rescue of Miners' Pensions Gives Hope to Musicians, Truck Drivers and Other Retirees

"The [Bipartisan American Miners Act of 2019], which marked the culmination of more than nine years of intense lobbying by members of the United Mine Workers of America ... demonstrates that Congress can find bipartisan solutions to protect multiemployer pension plans and their members. A December 2019 study ... showed that up to 116 other multiemployer plans are facing insolvency, putting more than one million plan members at risk of losing most or all of their benefits."

Pension Rights Center

Selected Discussions
on the BenefitsLink Message Boards

RMD in Year of 401(k) Plan Termination

"I have a client that has had a 401(k) Plan and has been taking RMD for several years. He terminated the plan in early 2019 and rolled his account into an IRA. In the year of termination, was he required to take an RMD from both the terminating plan and his IRA? In other words, must he take two RMDs in 2019?"

BenefitsLink Message Boards

Trigger Audit Risk When Going from Small to Large Plan?

"Client is moving from the short Form 5500 to the long form due to the number of participants. Does that switch increase the possibility of triggering an audit? (There are some other issues that require some expensive clean up.)"

BenefitsLink Message Boards

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Press Releases

401(k) Champion Award Seeks Applications
Jackson, Grant Investment Advisers, Inc.

Most Popular Items in the Previous Issue, Inc.
1298 Minnesota Avenue, Suite H
Winter Park, Florida 32789
(407) 644-4146

Lois Baker, J.D., President
David Rhett Baker, J.D., Editor and Publisher
Holly Horton, Business Manager

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BenefitsLink Retirement Plans Newsletter, ISSN no. 1536-9587. Copyright 2020, 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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