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Retirement Plans Newsletter

June 11, 2024

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[Official Guidance]

Text of DOL Proposed Exemption for Certain Prohibited Transaction Restrictions Involving UBS AG (UBS) Located in Zurich, Switzerland

"This proposed exemption would allow current and future asset managers under the UBS corporate umbrella to continue to rely on PTE 84-14 from June 12, 2024, to June 11, 2029 if certain conditions were met, notwithstanding the five judgments of conviction involving entities within the UBS and CSAG corporate umbrellas[.]"  MORE >>

Employee Benefits Security Administration [EBSA], U.S. Department of Labor [DOL]


Empower Your Business With The Right Technology Roadmap

Empower your business with the right technology roadmap. Our professional consultants have the expertise and experience to seamlessly integrate with your team, managing data, systems, and platforms to overcome any IT challenge. Learn More!

Sponsored by Enterprise Iron

[Guidance Overview]

New SEC Risk Alert Sheds Light on Broker-Dealer Exam Process

"To help broker-dealers prepare for an examination and assist in their compliance efforts, the [SEC] issued a new Risk Alert ... [which] outlines the areas of focus the staff may consider for an examination of a BD, as well as the types of information, including documents, the staff may initially request."  MORE >>

American Retirement Association [ARA]

[Guidance Overview]

CRS Report: Contributions to Defined Contribution Retirement Plans

34 pages. "This report provides an overview of DC plans, contributions to these plans, tax treatment of contributions, plan sponsor choices regarding contribution-related features, relevant IRC requirements, and related policy issues." [R48091 Jun. 11, 2024]  MORE >>

Congressional Research Service [CRS]

Judge Confirms Trial Date for American Airlines ESG Lawsuit

"A Texas federal judge has scheduled a trial date ... [in a] class action ... brought by a former pilot in June 2023. The plaintiff alleged the airline's 401(k) plan sacrificed performance for environmental, social and governance factors." [Spence v. American Airlines, Inc., No. 23-0552 (N.D. Tex. February 21, 2024; order setting trial date filed Jun. 5, 2024)]  MORE >>

PLANSPONSOR; free registration may be required

Target Date Funds: A Primer

"2024 is the 30th anniversary of target-date funds (TDFs), with the first TDF created in 1994.... This post provides a primer on TDFs including their logistics, advantages and disadvantages, selection criteria, and expenses. It also describes TDFs available from [some highly-rated vendors] and concludes with a summary of research about TDFs, three 'need to know' facts, and six take-away action steps."  MORE >>


Corporate Pension Funded Status Rose During May in Fifth Straight Month of Improvement

"[T]he Milliman 100 PFI funded ratio rose from 103.1% at the end of April to 103.4% as of May 31, driven by investment returns of 2.29%, the best-performing month of 2024. These gains lifted the net market value of PFI plan assets by $22 billion for the month, to $1.296 trillion. They helped offset the decline in discount rates, which fell in May by 15 basis points, to 5.53%, and caused plan liabilities to rise $18 billion to $1.253 trillion as of May 31."  MORE >>


Two States with Closed DB Plans Face Challenges Retaining Workers

"Alaska has experienced higher turnover and severe challenges to recruit and retain public sector workers since it closed the pension plan for new hires.... In Rhode Island, public sector worker turnover rose for almost every group after the hybrid plan was implemented, the 2024 NIRS experience study found."  MORE >>

PLANSPONSOR; free registration may be required

City Demands Thousands of Chicago Police Officers Pay Off Pension Error

"[A]pproximately 3,000 [Chicago police officers ] are required to cut a check to their pension fund, plus interest.... As part of the new contract for Chicago police officers approved by the City Council in late 2023, union members received a 2.5% base salary increase that applied retroactively to the start of 2022. 'The city did not withhold the correct 9% of members' salary and duty availability pay for the required payment,' according to a post on the fund's website.'  MORE >>

Chicago Tribune; subscription may be required

Why Fixing Social Security Sooner is Crucial: Munnell

"[A recent brief by Center for Retirement Research Director Alicia H. Munnelll] pointed out some potential solutions that would head off 'draconian benefit cuts' in 2033.... [T]he option of investing the Social Security OASI trust fund reserves in equities ... seems to have considerable support. But the window of opportunity to make this work is closing fast.... [If] payroll taxes were raised immediately by 3.50 percentage points (1.75% each for the employee and employer) the government could pay scheduled benefits through 2098, with a one-year reserve at the end."  MORE >>

401(k) Specialist


Is Your Company's 401(k) Match 'Unfair'?

"It should come as no surprise that the match dollars in your average 401(k) plan are more likely to wind up in the accounts of those who contribute more. Nor should it be a surprise that those who have higher salaries tend to contribute more. But the research from Vanguard not only noted (and quantified) some of those disparities, it provided some interesting ideas around various concepts behind matching contribution strategies and consequences."  MORE >>

American Retirement Association [ARA]

Executive Compensation and Nonqualified Plans

Supreme Court Decision Shakes Up Valuation Issues

"Business owners with insurance funded buy-back agreements should immediately consult their tax advisors to reevaluate such arrangements. The ruling changes the way that life insurance proceeds earmarked for the redemption of a deceased owner's stock are counted toward the company's valuation for federal estate tax purposes." [Connelly v. IRS, No. 23-146 (S. Ct. Jun. 6, 2024)]  MORE >>

Nixon Peabody LLP

Employee Benefits Jobs

View job as Internal Sales Consultant for The Finway Group, LLC

Internal Sales Consultant

The Finway Group, LLC

Remote / West Des Moines IA

View job as Internal Sales Consultant for The Finway Group, LLC

Selected New Discussions

Can Payment of a 'Benefit' Be Rescinded/Revoked/Voided If a Beneficiary Makes a Material Misrepresentation to Plan Admin?

"Can a primary beneficiary, or for that matter ANY beneficiary have their right to a 'benefit' voided/rescinded/revoked/etc. if said beneficiary makes a material misrepresentation (signed written statement/assertion under penalty of perjury) to the Plan Administrator AFTER the original Plan Participant has passed (died) and before a 'payout' has been made by the Plan/Plan's Administrator under the terms of said (ERISA-covered) Defined Benefit Plan? Any thoughts and especially legal case citation would be IMMENSELY appreciated!"

BenefitsLink Message Boards

403(b) Plan Irrevocable Election

"As a resident physician of a NYS hospital, making only 75k per and loaded with 500k of debt, my son-in-law made a one-time only, irrevocable election on the 403(b) plan of just 5% during the first day of orientation, without realizing what the future consequences could be. Now 5 years later, after finishing a one year fellowship in Vanderbilt Univ Hospital in TN, the same NYS Hospital has offered him a lucrative contract as a board certified physician. However, he didn't even recall signing the original irrevocable 403(b) form on his first day 5 years before, nor did anyone explain what the loss consequence could be if he later took a full position after residency. (He was obviously very poor, struggling and loaded with debt at the time he signed.) Is there any way, or is there any precedent in altering this one-time only election."

BenefitsLink Message Boards

Should Disabled But Working Employee Enroll in the 401(k)?

"Long term permanently disabled since childhood, on SSI, full time worker for client company. We just installed a new 401k plan at the company. Should the disabled employee participate? Our fear is that participation could end up costing the employee on his SSI benefits. That would be a bad deal for the employee, even with a very generous match. But I can't find anything saying that for sure. Anyone ever deal with this before?"

BenefitsLink Message Boards

Press Releases

Cetera Appoints Jerry Patterson Head of Advanced Wealth Solutions


Secrets For Wealth Introduces the Role of Certified Retirement Planners in Securing Financial Futures

Secrets for Wealth

Littler Continues Toronto Growth with the Addition of Shana French as Partner


Cooley Expands Compensation and Benefits Practice With Key Additions in DC and San Diego

Cooley LLP

Webcasts and Conferences
(Retirement Plans / Executive Compensation)

Refining the DC Investment Menu: An Outcomes Orientation

June 26, 2024 WEBINAR

Pensions & Investments

AI and the Actuarial Profession

July 10, 2024 WEBINAR

Conference of Consulting Actuaries

Last Issue's Most Popular Items

TIAA Retirement Suit Foreshadows Future 401(k) Litigation (PDF)

The Wagner Law Group

$1 Million Will Only Last 12 Years in Retirement in California

Motley Fool

AT&T Files Motion to Dismiss Lawsuits Related to Athene Deal


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

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