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Retirement Plans Newsletter

August 16, 2021

3 New Job Opportunities


How America Saves, 2021: Insights to Action (PDF)

13 pages. "Incorporate automatic retirement plan features beyond automatic enrollment ... Consider an advice solution to help participants find retirement saving and spending success -- regardless of market conditions ... Make your retirement plan one that can shield participants from the pitfalls of going it alone and can give them a better chance of success in retirement.... Review your plan's loan and withdrawal options, taking care to understand the trade-offs inherent with access to retirement savings."  MORE >>


Proper Documentation of Mergers: There's More to Mergers Than Just the Assets (PDF)

"In the past few years ... many entities have been instructing plan sponsors to merely sign a letter of directive and maybe a form to coordinate the merger of plans and their assets when a company merger/acquisition has occurred. There are several documents that need to be prepared and steps that need to be taken prior to the merger of the assets ... In fact, there are even attorneys who have written entire books on the subject of mergers and acquisitions in employee benefit plans. So, clearly, there is more to the merger process than just the joining of the assets."  MORE >>

Ferenczy Benefit Law Center, via Journal of Pension Benefits

District Court Partially Dismisses ERISA 401(k) Fee and Performance Claims for Lack of Standing

"[T]he court rejected the notion that plaintiffs suing derivatively on behalf of a plan under ERISA Section 502(a)(2) automatically have standing. The court explained that a plaintiff must assert both a cause of action under ERISA and a constitutionally cognizable injury-in-fact." [In re Omnicom ERISA Litigation, No. 20-4141 (S.D.N.Y. Aug. 2, 2021)]  MORE >>


District Court Denies Dismissal of Amway ERISA Lawsuit

"Among other allegations, the complaint says defendants continued to offer certain investment options despite the availability of identical or similar investment options with lower costs and/or better performance." [Garcia v. Alticor, Inc., No. 20-1078 (W.D. Mich. Aug. 9, 2021)]  MORE >>


District Court Dismisses 401(k) Plan Recordkeeper Fee Complaint

"The district court addressed the level of detail plaintiffs must provide to move an ERISA breach of fiduciary duty recordkeeping fee allegation from possible to plausible under Federal Rule of Civil Procedure 12(b)(6).... As to the claim of a breach of the duty of loyalty, the district court held that Plaintiffs had to offer more facts than their purported breach of prudence claims, recast as a loyalty claim ... explaining that a valid claim must allege 'something more' than a purported potential conflict of interest." [Johnson v. The PNC Financial Services Group, Inc., No. 20-1493 (W.D. Pa. Aug. 3, 2021)]  MORE >>

Jackson Lewis P.C.

First Multiemployer Plan Requests ARPA Special Financial Assistance

"According to an email blast the Road Carriers Local 707 Pension Fund [on August 13] became the first to seek bailout money under the PBGC Special Financial Assistance program for troubled multiemployer plans."  MORE >>


Over 20 Years, Better Outcomes Through Retirement Plan Design

"Extreme asset allocations have declined significantly over the last 20 years ... The shift is partly a result of PPA. As restrictions have eased, company stock use and concentrations have decreased. It's also a result of the rise in professionally managed allocations and the widespread use of target-date funds (TDFs) ... [An] automatic increase feature -- coupled with automatic enrollment at least at the employer-match level -- is a very powerful way to help participants reach their target."  MORE >>


Impact of Making Personalized Digital Information Available Through a Pension App

"[The availability of a personalized pension app] increases individual tax-favored contributions. Men and higher-income earners are more likely to access the digital environment and respond to its introduction. These findings suggest that providing access to a pension app reduces information and transaction costs and facilitates the take-up of financial incentives for retirement saving."  MORE >>

Claudio Daminato, Massimo Filippini, Fabio Haufler, via SSRN

Would You Rather Buy an Annuity or a Guaranteed Income for Life?

"[The authors] wondered whether some of the barriers to purchasing annuities are psychological.... The Major Discoveries: [1] People are more willing to use some of their 401(k) to purchase a guaranteed income stream for life than for an annuity.... [2] Thinking about running out of money during retirement increases preferences for deferred over immediate annuities."  MORE >>


Congress Considers Provisions That Would Limit When Retirement Plans Can Recover Overpayments

"[The proposed legislation would prohibit] 'plans from seeking recoupment if the first overpayment occurred more than three years before the participant (or beneficiary) is notified in writing about the error,' ... The legislation would also prevent plans from charging fees or interest on the overpayments, and it would also limit the amount that retirement plans can reduce a benefit, so that the amount 'being paid back yearly could not exceed 10% of the amount the person was overpaid.' "  MORE >>

Pension Rights Center


You Don't Need to Think Like a Nobel Laureate to Make (or Help Your Clients Make) Informed Retirement-Related Financial Decisions

"Data points to facilitate many retirement-related financial decisions can be obtained by answering the following two questions ... [1] Does the household have sufficient non-risky assets to fund the present value of their future Essential Expenses (their self-selected 'needs') using assumptions consistent with purchase of these liabilities from an insurance company? ... [2] Does the household have sufficient risky assets to fund the present value of their future Discretionary Expenses (their 'wants') using reasonable assumptions?"  MORE >>

Ken Steiner, FSA Retired


Claims That Illinois Pension Reform Would Fail at Federal Level Just Aren't True: The Case of Arizona

"Arizona has virtually the same pension protection clause as Illinois. Arizona amended its constitution not just once, but twice in 2016 and 2017, to reform benefits. Reforms included reductions to cost-of-living benefits for both existing workers and new workers. ... To this day, dissenters could, individually or as a group, attempt a lawsuit challenging the reforms under federal law, yet none have tried."  MORE >>



Mega-IRAs: Boon or Bane?

"The IRS should have the resources to challenge the tax exemption of any Mega-IRAs appearing to violate the current law.... There should also be statutory changes to direct tax incentives not at Mega-IRAs and their owners, but at improving the retirement readiness of American working families. This was why traditional and Roth IRAs were introduced and why they are called individual retirement accounts. [Specific] changes would help achieve this goal[.]"  MORE >>

Law Offices of Albert Feuer, via SSRN

Employee Benefits Jobs

View job as Retirement Plan Document Conversion and On-Boarding Supervisor/Manager
for My Benefits, LLC Retirement Plan Document Conversion and On-Boarding Supervisor/Manager

My Benefits, LLC

Remote / AL / FL / SC / TX

View job as Retirement Plan Document Conversion and On-Boarding Supervisor/Manager
for My Benefits, LLC

View job as Pension Administrator
for KB Pension Services Pension Administrator

KB Pension Services

Remote / Bradenton FL

View job as Benefits Advisor
for Employee Benefits Security Administration [EBSA] Benefits Advisor

Employee Benefits Security Administration [EBSA]

Remote / Kansas City MO

Selected New Discussions

Distribution Timing Differs for Retirees

"This plan is a non-standardized profit sharing plan. I'm working on the restatement and the client would like distributions to be delayed until a 1 year break in service following a participant's termination of employment, unless the termination is due to retirement (in which case the delay would be only 30 days). Would this be allowable? I'd have to add it under 'other' in the adoption agreement."

BenefitsLink Message Boards

Deferral/SH Match Limits for Plan Becoming Effective October 1

"If a client plan starts 10/1, are they able to defer the maximum of $19,500 if they have adequate compensation? Is the safe harbor basic match the full 4%, or is it reduced pro rata?"

BenefitsLink Message Boards

Payroll Department's 'Compensation' Didn't Line Up with Plan Document's Definition

"Plan set up beginning of last year with a certain definition of compensation. On payroll, a different definition of compensation was used. To what extent can plan be amended retroactively to match what has been done in practice (i.e., a self-correction)?"

BenefitsLink Message Boards

Press Releases

Jackson Introduces New Retirement Investment Annuity

Jackson National Life Insurance Company

Willis Towers Watson selects Carl Hess as President and Future CEO

Willis Towers Watson

NFP Acquires Fallon Benefits Group, Inc., an Atlanta-Based Employee Benefits Brokerage and Consulting Firm

NFP Corp.

Webcasts and Conferences
(Retirement Plans / Executive Compensation)

Hot Issues in Executive Compensation 2021

October 14, 2021 WEBCAST

PLI [Practising Law Institute]

Last Issue's Most Popular Items

DOL Is 'Encouraging' Retirement Plan Fiduciaries to Recoup Uncashed Participant Checks from Prior Recordkeepers

Morgan Lewis

Changing DC Plan Recordkeepers Can Be Complex: Steps for a Smooth and Successful Transition (PDF)


San Francisco Will Tax Employers Based on CEO Pay Ratio

Jackson Lewis P.C.

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

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