Updated June 17, 2022, to include one new Q&A: "How will PBGC assess the reasonableness of a proposed change in the assumption regarding the inclusion of benefits for older terminated vested participants in the cash flow projection used to determine the amount of Special Financial Assistance (SFA)?"  MORE >>

"A group of ... employees sued the government, arguing they were entitled to damages because the 35-day government shutdown in 2018 and early 2019 meant, along with their pay, contributions to the TSP were delayed. Because the lapse in appropriations occurred while 'the most popular [TSP] funds increased over 10%,' they missed out on those gains.... [The Third Circuit] found that while the 1986 Federal Employees' Retirement System Act allows federal employees to sue in instances when agencies do not make TSP contributions within 12 days of the end of a pay period, that does not extend to the potential gains those contributions might have produced." [John Doe v. U.S., No. 21-2140 (3d Cir. Jun. 13, 2022)]  MORE >>

"As a result of court rulings and the challenges of creating arbitration clauses that don't run afoul of ERISA or states' laws or legal precedent, the theoretical allure of arbitration to avoid an expensive ERISA court battle may be tempered by unclear reality.... [Plan sponsors] are cautious not only because of conflicting legal rulings but also because their cost-benefit analyses indicate arbitration might not be worth the time and expense."  MORE >>

189 pages. Also see 15-page section-by-section summary of the Act. The EARN Act is scheduled for hearing by the Senate Committee on Finance on June 22, 2022.  MORE >>

"The Senate Finance Committee on June 17 released the Enhancing American Retirement Now (EARN) Act, its counterpart to the House-passed SECURE 2.0 -- a massive piece of legislation that includes a number of key provisions[.]"  MORE >>

"In response to pension retrenchments implemented immediately, people close to retirement stay in the work force longer. News about future pension retrenchments with implementation lags, however, is likely to lead this group to exit the labor market. This decline in the labor force participation rate is particularly strong for reforms with long lags, ones that introduce fundamental policy changes, and where citizens have lower trust in the government."  MORE >>

"[F]inancial advisors generally prefer to promote probability-based approaches involving significant investment in equities. Actuaries and economists, however, prefer to match non-risky assets with essential spending liabilities utilizing a safety-first approach (also known as liability driven investing). This doesn't mean that retired households that utilize a safety-first approach shouldn't invest in equities (they should), but in order to avoid taking on too much investment risk, they need to focus first on funding their Floor Portfolio and second on funding their Upside Portfolio."  MORE >>

"Six months after the Supreme Court decision in Northwestern, we have one highly respected appellate judge saying that the Supreme Court was 'perfectly clear' that all excessive cases must be allowed to proceed to discovery, and that the only way for plan fiduciaries to justify their behavior is on a motion for summary judgment. But another respected appellate judge takes the opposite position that the Northwestern decision was limited to just one issue and that the Court ruled that plaintiffs must allege sufficient facts about an imprudent process in order to proceed beyond the motion to dismiss stage."  MORE >>

"Many participants do not look at their quarterly statements, preferring the immediate feedback of checking online information with current account balances and asset allocations, Those who do look at their quarterly statements often stop at the first page if the account balance meets their expectations, remaining unaware of information on fees, projected income, etc.... Only a handful will understand the retirement income estimates, what is in, what is left out, and why the estimates change."  MORE >>

"The due date may be extended if Form 5558 is properly filed with the IRS by the due date.... The information entered onto a Form 5558 should match the Form 5500 and the plan ... [R]ecognize it is your filing made under penalty of perjury; not that of a service provider who may have populated the form ... An auditor might sample some compliance issues and/or instances of late deposits; however, the process is not a comprehensive analysis of a plan's legal compliance."  MORE >>

"The [SEC] reopened the comment period for the proposed clawback rules initially proposed in July 2015, signaling that final rules will follow the end of this third comment period on the proposal.... After the SEC's final rules are issued, any issuer that has already adopted compensation recovery policies should examine its existing policies against the final rules to identify areas of likely change, including the applicable events that trigger clawback, the number of executives to whom the policy applies, the length of the applicable lookback window and any fault/misconduct requirements."  MORE >>