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Retirement Plans Newsletter

September 3, 2021

2 New Job Opportunities

 

[Guidance Overview]

DOL Issues FAQs on Lifetime Income Illustrations

"With respect to participant-directed individual account plans for which quarterly participant benefit statements are required ... the first 'lifetime income illustration' can be incorporated into any benefit statement up to the second quarter of 2022 (ending June 30, 2022).... For nonparticipant directed individual account plans for which participant benefit statements are required ... only once each calendar year, the first 'lifetime income illustration' should be included on the pension benefit statement for the first plan year ending on or after September 19, 2021."  MORE >>

Frost Brown Todd LLC

Third Circuit Affirms $96 Million Withdrawal Liability Award

"In a major win for the Steelworkers Pension Trust, the U.S. Court of Appeals for the Third Circuit upheld an award totaling $96 million in withdrawal liability and additional statutory penalties against the Renco Group, Inc.... The key lesson from this case is the importance of multiemployer pension plans thoroughly investigating controlled group liability." [Steelworkers Pension Trust v. The Renco Group, Inc., Nos. 19-3499, 19-3504 and 19-3507 (3d Cir. Aug. 26, 2021)]  MORE >>

Tucker Arensberg, P.C.

Exceptional Usefulness and Quality icon An Employee's 401(k) Plan Guide

"[This special report addresses] how to make the most of 401(k) plans today. [It includes] tips for how to invest in your plan and what to do if your plan is sub-optimal ... what alternatives you have for retirement saving if you don't have access to a 401(k) plan [and] ... some ideas for how to reform the retirement savings system over time[.]" [Specific reports are:  [1] 100 Must-Know Statistics About 401(k) Plans; [2] What Should I Do If I Don't Have a 401(k)? and [3] A Checklist for Lobbying [Your Employer] for a Better 401(k).]"  MORE >>

Morningstar

Investing Your Retirement Savings: 'Immunize Then Optimize'

"[T]ake your entire spending plan, everything you spend money on every month, and divide it into two pieces: fixed spending that happens no matter what and fun or aspirational spending.... To what extent will Social Security or any pensions you have ... [cover] your fixed required monthly spending? If you have coverage, then we know that your fixed spending is immunized.... [We] can [then] bias the portfolio heavily toward equities, or other risky assets, for the aspirational spending because even if there is a bad year, you can still cover your costs. You don't have to worry about liquidating at a bad time."  MORE >>

Christine Benz, via Morningstar

Teacher Retirement Systems: A Ranking of the States (PDF)

118 pages. "In [these] rankings, South Dakota ... emerges as the leading state ... Tennessee, Washington, Utah, and New York are also in the top five states. Pennsylvania, Connecticut, Kentucky, New Jersey, and Illinois make up the bottom five ... [T]hese overall scores mask variation in how each state serves different constituent groups; some states emerge with particularly strong ratings for short-term teachers, while others score much better for long-term teachers or taxpayers."  MORE >>

Bellwether Education Partners

Does Media Coverage of the Social Security Trust Fund Affect Claiming, Saving, and Benefit Expectations?

"Two treatment groups saw headlines emphasizing the trust fund's 2034 reserve depletion date -- using increasingly sensationalist language -- while a third treatment group saw a headline explaining that ongoing program revenues will cover three-quarters of scheduled benefits after 2034.... Treated respondents plan to claim around one year earlier than the control group. Treated respondents also shifted their expectations about the level of future benefits away from extreme positions and toward a more realistic assessment." [Working Paper WP#2021-10]  MORE >>

Center for Retirement Research at Boston College

Social Security Overview

"How is Social Security financed? ... Who qualifies for benefits? ... How are benefits computed? ... Who is receiving benefits? ... How much do beneficiaries receive? ... What is Social Security's status?" [In Focus no. IF10426, updated Sep. 3, 2021]  MORE >>

Congressional Research Service [CRS]

Social Security’s Funding Shortfall

"How is Social Security financed? ... What is Social Security's projected financial outlook? ... What is driving the projected funding shortfall? ... What happens to benefits if trust fund reserves are depleted? ... What can be done to restore balance? ... What is the timeframe for action?" [In Focus no. IF10522, updated Sep. 3, 2021]  MORE >>

Congressional Research Service [CRS]

[Opinion]

Beware of Unintended Effects of Retirement Savings Public Policies

"[A] dramatic expansion in both workplace retirement plans and participation levels would also give rise to equally dramatic increases in: Cashout leakage ... Missing participants ... Lost or 'stranded' accounts ... Uncashed distribution checks ... [C]ombining restrictive withdrawal policies with expanding access could ultimately be self-defeating, as erecting barriers to exit would have a chilling effect on participation and deferral rates."  MORE >>

401(k) Specialist

[Opinion]

Statement of U.S. Chamber of Commerce to ERISA Advisory Council on Gaps in Retirement Savings Based on Race, Ethnicity and Gender (PDF)

"EBSA should create a taskforce to review all current reporting and disclosure requirements not only to update them for their general effectiveness, but also to include information and delivery requirements that are relevant to race and gender.... EBSA also should review its current worker publications to see if they address issues related to the retirement gap based on gender and race.... EBSA is not able to do this, they can provide interactive models, calculators and worksheets that are accessible electronically and allow workers to see what happens if they do not contribute to their retirement plan.... EBSA should make it easier for small businesses to understand and provide retirement plans."  MORE >>

U.S. Chamber of Commerce

[Opinion]

CIEBA Testifies at ERISA Advisory Council Hearing on 401(k) Brokerage Windows

"[W]hile 54% of CIEBA Members offered some form of a brokerage window, only 2.8% of plan assets are invested through the window.... [W]hile utilization may be low, CIEBA Members still view windows as an important feature to retain participation for savers looking for options outside a 401(k) plan designated menu.... [W]hile windows help participation, undue monitoring obligations would lead plans to potentially eliminate the option in their plans."  MORE >>

Committee on Investment of Employee Benefit Assets Inc. [CIEBA]

Benefits in General

Employee Benefit Plan Audits Set for Major Changes, More Transparency

"Communications with management and those charged with governance will be more substantial and robust. The auditor's report will be more comprehensive and clearer. And practitioners will no longer issue a disclaimer when management elects to have an audit performed pursuant to ERISA Section 103(a)(3)(C)."  MORE >>

Journal of Accountancy

Employee Benefits Jobs

View job as Director of Compliance
for YMCA Retirement Fund Director of Compliance

YMCA Retirement Fund

New York NY / NJ

View job as Program Analyst (Project Manager)
for Centers for Medicare & Medicaid Services [CMS] Program Analyst (Project Manager)

Centers for Medicare & Medicaid Services [CMS]

Remote / Woodlawn MD / Boston MA

Selected New Discussions

11(g) Amendment for 414(s) Failure?

"Can a plan adopt an 11(g) amendment to fix a discriminatory definition of compensation? The plan excluded bonuses, and it does not contain a fail safe provision to automatically include bonuses when necessary to pass testing."

BenefitsLink Message Boards

Sole Proprietor Can Have Both a Solo 401(k) and a Cash Balance Plan?

"Can a sole prop (Schedule C) have a solo-k AND a cash balance plan?"

BenefitsLink Message Boards

Terminating Plan, But No Amendment for U.S. v. Windsor

"A terminating plan doesn't have an amendment regarding U.S. v. Windsor. Is an amendment required?"

BenefitsLink Message Boards

Press Releases

DOL Obtains Judgment After Investigation Finds Appleton Company Failed to Forward Employee Contributions to Retirement Plan

U.S. Department of Labor [DOL]

Webcasts and Conferences
(Retirement Plans / Executive Compensation)

Are Brokerage Windows Right for Your Retirement Plan?

RECORDED

Williams Mullen

Mitigating Fiduciary Risk

September 28, 2021 WEBCAST

Trucker Huss

Last Issue's Most Popular Items

IRS Updates Tools for Reviewing Retirement Plan Document Compliance

Thomson Reuters / EBIA

DOL's Lifetime Income Disclosure Illustration Requirement

October Three Consulting

Less Jargon, More Clarity: Improving Retirement Plan Communications with Simple Language Can Promote Action (PDF)

Empower Institute

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

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