"Recently one federal judge found allegations of a fiduciary breach in offsetting employer contributions with forfeitures 'implausibly broad' -- now a different judge draws a different conclusion.... Judge Yvonne Gonzalez Rogers ... refused to grant the fiduciary defendants of the Clorox 401(k)'s motion to dismiss the suit alleging a fiduciary breach in the decision to offset employer contributions with forfeitures." [McManus v. The Clorox Company, No. 23-5325 (N.D. Calif. Mar. 3, 2025)]  MORE >>

"The court specifically rejected Clorox's argument that language in the plan allows for the allocation of plan forfeitures to offset employer contributions ... The court also rejected the defendants' reliance on [Dudenhoeffer], to argue that the duty of prudence claim should be dismissed ... because at the time of the decision of how to use plan forfeitures, the defendants 'had enough information to know whether their decision was prudent when making a fiduciary decision.' " [McManus v. The Clorox Company, No. 23-5325 (N.D. Calif. Mar. 3, 2025)]  MORE >>

"Although the court outlines steps a fiduciary could take to ensure compliance with ERISA's duty of loyalty, it is unclear how these actions would make a meaningful difference to Plan participants in this case.... The court's analysis ... may incentivize plaintiffs to consider other circumstances where plan fiduciaries could be influenced by a plan investment manager that holds significant debt and equity in the plan sponsor." [Spence v. Am. Airlines, Inc., No. 23-0552 (N.D. Tex. Jan. 10, 2025)]   MORE >>

"Clergy and church employees of the African Methodist Episcopal Church, Nashville, Tenn., have secured a $40 million settlement from Newport Group, the third-party administrator of church retirement plans in a complex, long-running lawsuit against multiple defendants[.]" [Carmichael v. Harris, No. 22-1127 (W.D. Tenn. proposed settlement Mar. 4, 2025)]  MORE >>

"Incorporating alternative investments into defined contribution plans has long been touted as a strategy to allow for more diversification and enhance returns for investors.... While defined benefit pension funds have historically maintained higher allocations to alternatives, it remains to be seen if DC plan sponsors will offer participants access to alternative investment options, despite concerns related to governance and litigation."  MORE >>

"[A] high-inflation environment is positive from a tax standpoint. Every year, the tax brackets expand, while the tax rates remain the same.... Because of the marginal nature of the tax code, that means that more of a taxpayer's income is taxed at the lower rates. In the context of Roth conversions, that means it may be possible for a taxpayer to convert more funds at the lower rates."  MORE >>

"When investors are drawing money from their portfolios, the order in which they experience gains and losses is often more important than the gains and losses themselves. Periodic market volatility and unforeseen events (like a pandemic or banking crisis) are compelling reminders that generating retirement income from your assets can be precarious and requires careful planning."  MORE >>

"The lessons of FIRE have led to a shift in how people approach financial independence. Instead of treating retirement as an all-or-nothing goal, today's FIRE movement embraces more flexible approaches: [1] Emphasis on purpose beyond finances ... [2] Investment portfolio growth over mere frugality ... [3] Balanced financial planning for quality of life ... [4] Stronger community and ongoing education."  MORE >>

"Policymakers should look beyond best-case scenarios when evaluating a COLA. Any economic recessions or market downturns in the coming decades could lock Florida's taxpayers into paying for this proposal for longer than planned and at much higher costs.... [M]odeling of the Florida Retirement System shows the additional cost of bringing back cost-of-living adjustments, as proposed in House Bill 945, could rise above $47 billion over 30 years."  MORE >>

"ERISA penalties have been adjusted for inflation, which means the costs of non-compliance for employers have increased. This article will explore the various penalties under ERISA, the adjustments made for inflation, and how these changes impact employers and employees alike."  MORE >>

"A 65-year-old man enrolled in a Medigap plan with average premiums will need to have saved $109,000 to have a 50 percent chance of having enough to cover premiums and median prescription drug expenditures, and a 65-year-old woman will need to have saved $133,000. To have a 90 percent chance of meeting their health care spending needs in retirement, a man will need to have saved $191,000, and a woman will need to have saved $226,000."  MORE >>