"Under the final regulation, separate prescribed interest rates apply to the plan's existing assets and the SFA.... The final regulation ... significantly expands the ability of plans to invest SFA in securities other than investment-grade corporate bonds, allowing up to 33% of SFA to be invested in 'return-seeking assets' (RSAs).... [T]he final rule conditions receipt of SFA on a plan phasing-in the recognition of the SFA over time for purposes of calculating withdrawal liability."  MORE >>

"[T]he changes will result in higher amounts of financial assistance for many plans and should make it more likely that plans receiving assistance will stay solvent through at least 2051 as ARPA intended.... [1] Amount of assistance ... [2] Investment return assumption ... [3] MPRA conundrum ... [4] Permissible investments ... [5] Withdrawal liability."  MORE >>

"While aspects of the rule were already in effect, now advisors must also provide the mandated written explanation to rollover clients of the specific reasons as to why the investment professional and/or financial institution believe that the rollover is in the client's best interest, or else face substantial potential liability. This exposure is likely to trigger coverage under professional liability (E&O) policies, as opposed to fiduciary liability policies which protect plan sponsors."  MORE >>

"Gov. David Ige (D) signed legislation creating the program into law on July 12. It went into effect immediately. The program has two unique features.... In order to participate in the program, employees will have to opt in. And unlike any other state so far, one of the members of the board that will administer the program will be a retiree living in Hawaii, to represent retirees."  MORE >>

"Effective January 1, 2022, financial institutions operating in Minnesota are required to begin withholding Minnesota Personal Income Tax on annuity and pension payments made to any of its customers that reside in Minnesota.... If a financial institution has nexus in Minnesota but has not withheld Tax on pension and annuity distributions after January 1, 2022, it could be liable for up to the full amount of the Tax that should have been withheld, together with a penalty for failure to timely withhold and remit Tax."  MORE >>

"Even though the law and the plan terms may permit the exclusion of an acquired company's employees during the transition period, the plan must meet all the coverage and nondiscrimination rules after that period ends. Changing plans and their design isn't necessarily an easy thing, so preplanning is required."  MORE >>

"[1] Loan policy ... [2] QDRO procedures ... [3] Cybersecurity policy and procedures ... [4] Missing participant and uncashed check procedures ... [5] Investment policy."  MORE >>

"[It's] common for business owners to wait too long to notify their 401(k) provider that a common law employee has met their solo plan's age and service eligibility requirements.... This delay can lead to steep consequences[.]"  MORE >>

"47% of advisors surveyed cited networking as the most effective prospecting method. This was followed by social meetings or luncheons at 38%. Third was CPA relationships at 35%. Then educational seminars or speaking engagements -- that got 32% of the vote."  MORE >>

"[A recent study] finds total unfunded liabilities for state-run pension systems across the country would rise to $1.3 trillion assuming a -6% rate of return for the fiscal year.... Even with a rate of return of -6% and -12%, Washington's public pension system would still be funded at a rate of 107% and 101%, respectively[.]"  MORE >>

"Equable estimates the aggregate 2022 funded ratio will decline to 77.9% and aggregate unfunded liabilities will increase to $1.4 trillion -- the largest single-year decline in funded ratio since the Great Recession. The good news is that the net trend between 2019 and 2022 is still positive, with improved funded status. The bad news is that the state of pensions in America is still fragile."  MORE >>

13 pages; rev. Jul. 2022. "Hybrid plans have been in place in public sector retirement systems for decades, and they have received increased attention in recent years ... While most states have chosen to retain their defined benefit (DB) plan by modifying required employer and employee contributions, restructuring benefits, or both, some states have looked to hybrid plans as retirement benefit policy solutions."  MORE >>