BPP401k.com Newsletter December 30

New Report Reveals That Advisors Who Sell DC Plans are 40% More Successful Advisors who cultivate relationships with retirement plan sponsors benefit from significantly larger books of business than their peers. Source: 401khelpcenter.com

Who’s reinstating the 401(k) match — and who will soon? The latest sign employers are optimistic about the year ahead: the return of the 401(k) match. According to a recent Fidelity Investments survey, 27% of companies that suspended their 401(k) matches during the worst of the recession have reinstated the match — or plan to by the end of 2010. Source: CFO Daily News

Fidelity Expands 401(k) Investment Offering Fidelity Investments has expanded the investment options on its Advisors 401(k) platform, in an effort to help its advisors boost their share of the advisor-sold market. Source: Financial Planning

Principal Faces a Excessive Fee Suit The attorneys at Seattle-based Keller Rohrback unveiled a lawsuit (filed October 28) over the Principal SAM Balanced Portfolio, claiming that Principal "improperly charged shareholders excessive investment management and distribution fees." Source: ;Mutualfundwire.com

Cell Phone Tracking: How to Locate Your Kids With GPS Various cell phone carriers (including Sprint, Verizon Wireless, Alltel Wireless, Kajeet and others) allow parents to locate their kids with GPS. Source: About.com

Evaluating Retirement Plan Advisors -- Part A This is the first installment of a guide produced by the Center for Due Diligence to help plan sponsors fulfill their fiduciary duty and avoid liability. Source: Center for Due Diligence

The Regulatory Systems for Employee Benefits Employee Benefits Law is complex and often misunderstood. This article explains the regulatory systems developed by Congress over nearly a century and how all of the pieces fit together. Source: Social Science Electronic Publishing

As Fund Menus Tighten, Interest in Self-Directed Accounts Grow When the market takes a nose dive participants grow grumpy and start complaining about investment performance and the options available on their retirement plan menus. That is why now might be a good time for plan sponsors to at least consider the idea of offering their employees a self-directed brokerage account window. Source: Plansponsor.com

New Research Zeros in on Target-Date Funds Despite being fairly new to the 401k plan menu, target-date funds continue to move the needle on saving for retirement, but some investors need to get a better grasp on how the funds work. Source: Employee Benefit News

The Side Effects of 401k Auto-Enroll While automatically enrolling employees into 401k plans increases participation, it also may have some unintended side effects. Source: Wall Street Journal Blog

The Duty to Remove Investments It is commonly accepted that fiduciaries of participant-directed plans have a duty to select, monitor, and remove investments prudently. The threshold question is whether a fiduciary’s duty to remove investments applies to individual investments or whether the decisions are judged on the basis of the investments in the aggregate. Source: ;Plansponsor.com

Addressing Fiduciary Concerns in the Purchase of 401k Distributed Annuities -- Part 1 In this article the author focuses on the fiduciary risk of "irrevocably" (the 30 year risk) or how one gets comfortable with the inherent risk of an insurance company failing over an annuitant's lifetime. Source: Business of Benefits Blog

Addressing Fiduciary Concerns in the Purchase of 401k Distributed Annuities -- Part 2 Inflexibility and Inaccessibility are closely related, as they really point out the nature of annuity products purchased from plan assets which make them plan investments. As plan assets, the inclusion of an annuity in a DC plan becomes a fiduciary decision, not a settlor function. Source: Business of Benefits Blog

;Wal-Mart Decision Reinvigorates 401k Plan Fee Challenges A recent decision by the Court of Appeals for the Eighth Circuit has overturned the dismissal of challenges to fees paid by th Waal-Mart 401k Plan, one of the largest in the U.S. Coming after a recent agreement by Caterpillar Inc. to settle similar claims against it, th Waal-Mart decision is sending shock waves through the U.S. investment and fiduciary communities. Source: Pensions & Benefits Law Blog

401k Fee Litigation December 2009 Update Over the past several years, more than two dozen lawsuits have been filed relating to 401k plan fees and, more specifically, "revenue sharing" arrangements with plan service providers. In addition to the lawsuits against plan sponsors, lawsuits have been brought against 401k plan service providers. These cases typically are based on allegations that the service providers are "functional fiduciaries" under ERISA. Source: Groom Law Group

House Democrats Introduce Bill Amending Qualified Plan Nondiscrimination Rules Representative Lloy Doggettt (D-TX) recently introduced H.R. 4126, the "Retirement Fairness Act of 2009," which would significantly strengthen the qualified plan nondiscrimination rules and potentially jeopardize the qualified status of many plans. Source: JP Morgan

Court Moves Forward Kraft Foods Excessive Fee Suit A federal judge has moved forward claims by Kraft Foods Global employees that retirement plan fiduciaries breached their duties by offering investment options that under performed and charged excessive fees. Source Planadviseer.com

The Trouble With 403(b) Cash; the 403(b) SAR; and Other 403(b) Stocking;Stufferrs 403(b) devotees often speak of the continuing and significant number of technical differences between 403(b) and 401k plans. This article lists a few of the differences not given a lot of attention. Source: Business of Benefits Blog
401k and Profit Sharing Plan Eligibility Survey 2009 This is the 2tth year that PSCA has collected defined contribution plan eligibility data. The changes over time have been significant. In 1998, only 24 percent of plans allowed employees to begin contributing to their 401k plans immediately upon employment. This percentage has more than doubled since. Source: Profit Sharing/401k Council of America

Retirement Plan Participation: Race/Ethnicity Differences How do race and ethnicity affect the likelihood of participating in a retirement plan? How do the size of employers and the birthplace of workers affect these levels? Here are some of the key findings concerning race/ethnicity differences in employment-based retirement plan participation. Source: Employee Benefit Research Institute

Participating in a Retirement Plan: Gender Differences How does gender affect the likelihood of participating in a retirement plan? Here are some of the key findings on gender in employment-based retirement plan participation. Source: Employee Benefit Research Institute

Emerging Retirement Model Study: A Survey of Plan Sponsor MetLiffe conducted this survey of 240 plan sponsors at companies with at least 1,000 employees to examine employer attitudes and behaviors towards the aging workforce in the midst of a deep economic crisis, and recent regulation addressing the retirement security provided by pension and retirement plans. Source MetLiffe

Defined Benefit vs. 401k Investment Returns Watson Wyatt has been comparing investment rates of return in defined benefit and defined contribution plans for more than 10 years, and DB plans have been the long-term victor. This analysis updates our prior studies with investment returns for 2006 and 2007 for a large set of plans, as well as a snapshot of year-end returns for 2008 based on a small set of plan sponsors. Source: Watson Wyatt

NAPFA Applauds SEC Effort to Rethink 12b-1 Fees;Advisorrs who cultivate relationships with retirement plan sponsors benefit from significantly larger books of business than their peers. Source: 41khelpcenteer.com

DOL Issues Ruling on Target-Date an Lifecyclle Mutual Funds Although the DOL affirmed the current state of the law in its recent advisory opinion, regulatory and legislative initiatives affecting target-date funds and their use in retirement plans remain under discussion, and have been the subject of additional Congressional hearings. In addition, guidance for benefit plan fiduciaries on the selection and use of target-date funds is expected to be published by the DOL. Source Decherrt LLP

DOL Approves Use of Summary Prospectus to Satisfy ERISA 404(c) In September 2009, the DOL issued Field Assistance Bulletin 2009-03, permitting the use of summary prospectuses to satisfy the prospectus requirement of ERISA Section 404(c). Source: Prudential

Coming Soon: Broader Definition of Fiduciary Under ERISA The Labor Department is planning to expand its definition of fiduciary under ERISA — a move that would have implications for all financial advisers that work on retirement plans. Source Investmentnewws.com

Marketplace News
·  Fidelity Expands 401k Investment Offerings
·  BNA Books Releases 2009 Cumulative Supplement to 'Employee Benefits Law'
·  Vanguard Announces Plans for New Actively Managed Equity Fund
· eRolloveer Appoints Tim Harrington Chairman and CEO
·  Towers;Perriin/Watson Wyatt Announce Shareholder Approval of Merger
·  U.S. Retirement Announces Alliance With Financial Independence Group
·  Department of Labor Sues to Protect Participants of 401k Plan
·  DOL Obtains Appointment Independent Fiduciary for Abandoned New York 401k

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BPP401k.com Newsletter December 23

New Report Reveals That Advisors Who Sell DC Plans are 40% More Successful Advisors who cultivate relationships with retirement plan sponsors benefit from significantly larger books of business than their peers. Source: 401khelpcenter.com

BofA Merrill Introduces Retirement Plan Adviser Designation Bank of America Merrill Lynch is rolling out internal designation programs for financial advisers specializing in the sales and servicing of corporate defined contribution plans. Source: Plan Adviser

Senate OKs Health Bill Amendment, Limits Debate On Full Bill Members of the Senate today voted 60-39 both to approve a major manager's amendment to H.R. 3590, the Senate health bill, and to protect the bill from a filibuster. Source: National Underwriter

Will 2010 bring 401k reform? More than a year after the stock market meltdown, a big rally has soothed the pain and slowed the push to overhaul the retirement system. So what's next for our nest eggs? Source: MSN.Money

End-of-Year Financial 'To Do' List Between the bustle of the holidays and a rapidly approaching finale to 2009, little time remains to act on some very important financial matters, actions that can help us hang on to more of our hard-earned money, but only if addressed prior to year's end. Source: ABC News Chicago

IRS Audit Project Finds Low Bonding Coverage Problem When the Internal Revenue Service (IRS) put about 50 Form 5500 filings to the test recently, the plans filing the annual reports flunked on one major issue – buying enough fiduciary bond coverage for their fiduciaries and administrators. Source: PlanSponsor

Brokers As Fiduciaries: The Reality and the Issues This article describes a possible -- and perhaps likely -- outcome of the current initiative concerning fiduciary status for broker-dealers and financial advisers who provide advice to investors. Those changes will materially affect current practices of broker-dealers. Because of the likelihood that this, or similar, legislation will be adopted, broker-dealers are well advised to begin examining the consequences. Source: Reish & Reicher

More Employers Considering Annuities in 401k Plans The number of employers planning to offer annuities to participants in their 401k plans is expected to grow as companies look for ways to provide workers with a steady distribution of benefits during retirement, according to a survey by Watson Wyatt. Source: 401khelpcenter.com

Retirement Plan Participation Showed Small Decline in 2008 Participation in employment-based retirement plans decreased by small amounts for most categories of workers in 2008, but those with the strongest connection to the work force experienced the smallest decline, according to a study released by the Employee Benefit Research Institute. Source: CCH

Look Before Rolling Over a Business Startup Promoters have been marketing on the Internet the use of 401k funds to purchase franchises or startup businesses, which normally require up-front material sums of monies to launch. However, those seriously contemplating pursuing such a financing maneuver to fund a new business should tread carefully. Source: webCPA.com

The Independent Fiduciary Experience Sponsors who want to do right by their employees, reduce their own legal exposure, and simplify their daily lives should consider hiring an independent fiduciary. Source: The Float Blog

Conventional Wisdom, Fiduciary Duty and 401ks 401k fiduciaries are in uncharted territory and pay heed to the advice of Robert Khuzami, director of the Securities and Exchange Commission's Division of Enforcement, that "it's better to be in the prevention business than the cleanup business." This article discusses steps fiduciaries should take to minimize the likelihood of successful lawsuits against them. Source: Investment Horizons

Towers Perrin Retirement Legislative Tracking Chart Thousands of bills are introduced in Congress but only a select few are summarized on this chart. This selection represents Towers Perrin's best judgment on the likelihood of enactment and the relevance of the issue for employers. Source: Towers Perrin

Senator Kohl Announces Intent to Strengthen Fiduciary Oversight of Target Date Funds U.S. Senator Herb Kohl, chairman of the Senate Special Committee on Aging, announced his intent to introduce legislation that will require target date fund managers to take on a fiduciary responsibility in order for such funds to be eligible for the designation of QDIA. Source: 401khelpcenter.com

Advisor Releases White Paper on 403(b) Retirement Plan ERISA Compliance Diversified Investment Advisors has released a white paper on 403(b) plan compliance with ERISA statutes. Diversified partnered with Groom Law Group to prepare the paper in light of the urgency surrounding compliance with the final 403(b) regulations and the pressing concern regarding the application of proper fiduciary practices. Source: 401khelpcenter.com

IRS Offers Initial Remedial Amendment Period Guidance for 403(b) Plans Signaling what will be coming down the pike soon for 403(b) plans, the IRS has issued Announcement 2009-89 to provide some information in advance of the anticipated 403(b) "pre-approved" or prototype program, which it says will be out "in a few months", and will be followed by an individual determination letter program. Source: Groom Law Group

IRS Announces Future Guidance on Procedures for 403(b) Plan Qualification The IRS has announced that it will issue revenue procedures in the next few months for obtaining opinion letters for prototype 403(b) plans and for obtaining determination letters for individual 403(b) plans. An employer that adopts a pre-approved plan with a favorable opinion letter or that applies for an individual determination letter under these revenue procedures will be able to retroactively correct any defects in its 403(b) plan. Source: Buck Consultants

DOL Confirms That Assets in Registered Fund of Funds Are Not Subject to ERISA In Advisory Opinion 2009-04A, the U.S. Department of Labor opined that assets in a fund of funds registered under the Investment Company Act of 1940 are not plan assets subject to regulation under ERISA. A money manager requested the opinion, out of a policy concern about the practice of target-date or life cycle funds investing in affiliated mutual funds. Source: Sutherland Asbill & Brennan LLP

Employee Plans News - Winter 2010 Edition This edition includes articles such as 2010 Rules for Roth IRAs; Roth IRA Distributions; Notice Requirements for Pension Plans That Reduce Benefit Accruals; 2009-2010 EP Guidance Plan; Priorities for the Upcoming Year; Deadline for Certain Required Plan Amendments is Extended; The EPCU Insider; and PBGC Insights. Source: IRS

Misinterpreting the IRS' New PPA Amendment Deadline Could be Costly Plan sponsors who have not yet adopted the PPA and WRERA amendments for which the deadline has not been extended still need to do so, generally before the end of this year. If they do not do so, they will be exposed to penalties under the IRS correction programs or on plan audit. Source: Pensions Benefits Law Blog

No Extension of PPA Amendment Deadline Contrary to rumors currently circulating, IRS Notice 2009-97 does not provide for a general extension of the deadline to adopt a good-faith PPA amendment. The amendment only delays the deadline for three specific PPA provisions. Source: Sungard/Relius

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BPP401k.com Newsletter December 16

SunTrust Introduces Daily Budgeting Facebook App Savings has a new social media "friend". In support of its Live Solid initiative, SunTrust Banks, Inc. has launched Daily Dollar, a Facebook application that it says "brings to life the notion that small lifestyle changes can add up to big savings." Source: PlanSponsor

Study Finds Shift in Generation Y Attitudes Toward Finances, Employment And Benefits Fidelity Investments announced the results of a new study of young working Americans which reveals a shift toward more conservative behavior in financial matters and employment decisions. Yet one in four can't imagine ever being free of credit card debt. Source: 401khelpcenter.com

Latinos: The New 401(k) Market Opportunity? With Latinos being the fastest-growing segment of the United States workforce, it would seem that capturing the Latino 401(k) market would be big business for plan providers. Source: Bank Investment Consultant

401(k) Matches Making a Welcome Comeback In another sign that things may be looking up, many companies that had suspended their 401(k) matches say they've either restored them or plan to in the first quarter of 2010 Source: Consumer Reports

Required Minimum Distribution Rules Change After This Year The 2008 tax legislation gave senior citizens a reprieve from the requirement to take 2009 required minimum distributions from employer-sponsored tax-qualified retirement plans and IRAs. However, there may be sound tax reasons to either take or stop taking RMDs before 2009 ends. Source: 401khelpcenter.com

Key Numbers for 2010 Source: Cannon Financial Institute

DC plans step it up in tough times, PSCA survey shows Almost 77% of defined contribution plan executives have continued making matching company contributions to their 401(k) plans, while 73.2% continue to make non-matching company contributions in 2008 and 2009, according to a survey by the Profit Sharing/401k Council of America.Source: Pensions & Investments

The Four Stages of An Annual Review As the year draws to a close, fiduciaries should be turning their attention to one of their most important responsibilities: the annual portfolio review. This is a prime event conducted in the process of fulfilling the continuing fiduciary duty to monitor. It is the time when the fiduciary undertakes a comprehensive assessment of whether the investment objectives of the investors they serve are being met. Source: Investmentnews.com (free registration may be required)

Plan Sponsors May Face New Fiduciary Responsibilities Plan sponsors need to increase their educational efforts and may find it prudent to engage an outside investment advisory firm as well as competent legal counsel so as to assume and delegate fiduciary responsibility for the advice provided on behalf of the plan, as well as plan participants and beneficiaries, ensuring that suitable guidance is provided with respect to guidelines pursuant to ERISA law. Source: Gerson Lehrman Group

ERISA Section 404(c) and Summary Prospectus DOL Field Assistance Bulletin 2009-3 describes the circumstances in which a participant-directed individual account plan may satisfy the prospectus delivery requirements of Section 404(c) by providing a Summary Prospectus. Source: McKay Hochman

QDIAs and Other Options Under ERISA Section 404(c) Find out how ERISA provisions can help you deal with "undirected funds" in a participant directed retirement savings plan. It's all outlined in the white paper written by third party expert Groom Law Group. Source: Principal Financial Group

2010 Sample Compliance Calendar This sample 2010 compliance calendar provides general key retirement plan compliance requirements common to most calendar year plans. Source: ERISAdiagnostics

Compliance Update for Tax-Qualified Retirement Plans This article describes upcoming key deadlines and actions that must be taken by plan sponsors of tax-qualified retirement plans by the end of 2009 or beginning of 2010. In particular, many plan sponsors that maintain qualified plans must adopt certain amendments to comply with the Pension Protection Act by December 31, 2009. Source: Paul, Hastings, Janofsky & Walker LLP

Nearly Half of Suspended 401k Matches Now Restored Of the companies that have suspended matching contributions to their 401k plan, nearly half, 46.7%, have either already reinstated the match or plan to do so in the first quarter of 2010. Among large companies, 52.7% have restored the match or plan to do so. Source: Financial-Planning.com

AUDIO: Interview with Marcia Wagner Fee litigation at 401k plans, such as the recent proposed $16.5-million settlement at Caterpillar Inc., are often in the news. Marcia Wagner, managing partner at The Wagner Law Group, discusses current trends in fee litigation and evolving best practices for plan sponsors. Source: Plansponsor.com (free registration may be required)

Lifetime Income Disclosure Act -- S. 2832 This is the text of Senate bill S. 2832 which would amend the Employee Retirement Income Security Act of 1974 to require a lifetime income disclosure to plan participants. Source: American Benefits Council

Remedial Amendment Period and Reliance for Section 403(b) Plans This announcement 2009-89 provides for a remedial amendment period and reliance for employers that, pursuant to the upcoming revenue procedures, either adopt a pre-approved plan with a favorable opinion letter or apply for an individual determination letter when available. Source: IRS

Using the Third Condition of DOL's FAB 2009-2 to Manage 403(b) Audit Expense The real key to making the FAB work for the employer in keeping auditing costs down is in the sensible application of the FAB's 3rd condition. The author suggests that applying it consists of two parts. First, use a reasonable effort to determine and find contracts that were related to the plan at some time in the past and, secondly, making a reasonable effort to determine whether or not the rights under those contracts are legally enforceable by the individual. Source: Business of Benefits Blog

Will Automatic Enrollment Reduce Employer Contributions to 401k Plans? This paper examines the relationship between employer matching behavior and automatic enrollment. Using a sample of large 401k plans, the study found that match rates are about 7 percentage points lower among firms with automatic enrollment than among those without automatic enrollment, even controlling for firm characteristics. Source: Center for Retirement Research at Boston College

Women and Retirement: Facing Challenges in a Recession While the recession has impacted most workers' outlook for retirement, women's outlook has fared worse. The survey data highlights some areas of concern, but also reveals opportunities to help women and all workers get back on track with their retirement savings. Source: Transamerica Center for Retirement Studies

Advisers to Funds Within Target-Dates Not Plan Fiduciaries In an advisory opinion, the U.S. Department of Labor addressed whether investment advisers to the mutual funds underlying target-date funds used in a retirement plan are plan fiduciaries. Source: Plansponsor.com (free registration may be required)

DOL Advisory Opinion 2009-04A Issue: Whether target-date or lifecycle mutual funds constitute "plan assets" of investing employee benefit plans or whether the investment advisers to such mutual funds are fiduciaries to the investing plans under ERISA. Source: U.S. Department of Labor

DOL's Statement of Regulatory and Deregulatory Priorities for 2010 This Fall 2009 "Statement of Regulatory and Deregulatory Priorities" identifies regulatory priorities and contains information about the most significant regulatory actions that the DOL expect to undertake in the coming year. Source: U.S. Department of Labor

DOL Discusses Lifetime Annuity Income Project In a written summary of planned regulations, the DOL suggested the lifetime retirement income stream might ultimately become a consideration in judging the behavior of fiduciaries under the Employee Retirement Income Security Act. Source: Planadviser.com

SEC to Make Recommendations on 12b-1 Fees, Target-Date Funds Advisers could be looking at some changes on target-date funds next year, and maybe a change in certain mutual fund fees. Source: Planadviser.com

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BPP401k.com Newsletter December 9

Who Sponsors the Top 401(k) Plans? While many Americans must rely on themselves to save and invest for retirement in defined-contribution plans, some companies excel in supporting their employees with great 401(k) programs. Which companies do the best job? The answer to that question may be right here: BrightScope has announced its inaugural Year-End Top 30 Ratings List of the best 401(k) plans with $1 billion or more in assets. Source: Investment Advisor

DB(k): New Pension Option for Small Biz Small businesses will get a new retirement savings option in 2010 -- the DB(k). Adoption is expected to be slowed, however, by the sluggish economy and missing regulatory details. Source: Financial Advisor Magazine

Washington Goes into 401(k) Withdrawal The Obama Administration has decided we are going to make a mess of managing our 401(k)s in retirement and wants to do something about it. Both the Treasury Department and the Labor Department have signaled their 2010 agendas will look at reforming the 401(k) withdrawal process to keep us from blowing through our savings too fast. Source: CBS Moneywatch

A House Divided: Americans Have Two Distinct Views of Retirement New research from The Hartford shows spike in consumers' concerns about making ends meet in retirement. But findings show those who plan for retirement are decidedly more optimistic, more financially ready and more likely on target. Source: 401khelpcenter.com

The Plan Sponsor’s Ability to Evaluate Conflicts of Interest When making decisions about their retirement plans, plan sponsors have a duty to understand and evaluate conflicts of interest that could impact the plan. In some cases, plan sponsors are prohibited from entering into transactions that involve conflicts of interest. Source: Reish & Reicher, PC

Vanguard: 60% of 401k Accounts Recovered Another major provider of 401(k) accounts says the typical retirement saver now has more money in their account than they did before the stock market began tumbling two years ago. Source: Associated Press

The Different Flavors of ERISA Fiduciaries Discusses the significant added protection afforded a plan sponsor when it utilizes the services of an advisor serving as a fiduciary under section 3(38) of the Employee Retirement Income Security Act of 1974 as opposed to an advisor serving as an ERISA section 3(21) fiduciary. Source: Morningstar

The Plan Sponsor's Ability to Evaluate Conflicts of Interest When making decisions about their retirement plans, plan sponsors have a duty to understand and evaluate conflicts of interest that could impact the plan. In some cases, plan sponsors are prohibited from entering into transactions that involve conflicts of interest. Those conflicts fall into two broad categories discussed here. Source: Reish & Reicher, PC

Target-Date Fund Users Apparently Don't Understand Their Purpose Some investors in target-date funds apparently do not understand the purpose of the funds and could end up with a potentially inferior portfolio in terms of risk/return tradeoff, according to a study published today by the nonpartisan Employee Benefit Research Institute. Source: 401khelpcenter.com

2009 End-Of-Year FAQ The end of 2009 will prove to be a busy (and hectic) time for those responsible for maintaining benefit plan documents. This FAQ provides answers to some of the more common questions that the folks at Relius have received. Source: Sungard/Relius

2009 Plan Year: Year-End Compliance Reminders Every year, plan sponsors must make sure their plans meet certain compliance requirements, including those listed in this article. This publication identifies the materials you need to review and will help you prepare for year-end. Source: Prudential

Bill Introduced in Congress Would Prohibit Cross Testing A bill, HR 4126, has been introduced in the House of Representatives which, among other things, would prohibit cross testing. Source: Benefitsforward.com

Bill Calls for 401k Income Estimates Legislation introduced in the Senate this week would mandate that 401ks and other defined contribution plans provide data on how much income a participant’s account balance would generate each month at retirement. Source: National Underwriter Life and Health Insurance News

Appeal of United Technologies 401k Ruling Fails A U.S. appeals court has affirmed a lower court ruling that determined United Technologies Corp. did not breach its fiduciary duties concerning its 401k plan expenses and investments. Source: Businessinsurance.com

Year-end Review of New 403(b) Regulations As we approach the end of 2009, 403(b) plan sponsors should review their plans and the way in which they operate. This chart highlights the major provisions of the new 403(b) rules and provides useful references for plan sponsors. Source: Prudential

Addressing 403(b) Plan Issues This is the first of a two part article addressing issues that private sector 403(b) sponsors need to be concerned about, with some recommendations on how to deal with them. Source: Reish & Reicher, PC

DOL Considering 403(b) FAQ The DOL is considering issuing a 403(b) "Frequently Asked Questions" as they have done twice for the Schedule C. The FAQ is to address critical year end 403(b) issues related to reporting and Title 1 status. Source: Business of Benefits Blog

Impact of Economic Conditions on 403(b) Plans PSCA's "Impact of Economic Conditions on 403(b) Plans" reflects responses from 609 not-for-profit organizations that currently sponsor a 403(b) plan. Data in this survey is often categorized by plan size. Plan size is determined by the number of active participants in the organization's plan. Source: Profit Sharing/401k Council of America

Vanguard Study Finds Recovery in 401k Plan Balances The typical 401k participant now has greater 401k retirement wealth than before the severe market downturn, according to a new Vanguard report. Vanguard's research also indicates that investors holding solely target-date funds had even more positive outcomes relative to other participants. Source: 401khelpcenter.com

Insights from Annual Defined Contribution Survey In one of the more challenging economic years in memory, it is not surprising that the pace of change set in motion in defined contribution plans by the Pension Protection Act slackened. If anything, it is remarkable that the adoption of devices such as automatic enrollment and contribution acceleration did not decline. Source: Plansponsor.com

Schwab Study Reveals Sudden Shift in Retirement Expectations Americans are becoming more realistic about retirement, with nearly half of those currently eligible for Social Security now planning to work in their "golden years." But there is one thing all generations refuse to change: 95 percent say they would not be willing to spend less in retirement. Source: 401khelpcenter.com

DOL to Retirement Plan Sponsors: Criminal Sanctions Will Increase for Certain Non-Compliance While the DOL has penalized employers in the past for being slow to remit elective deferral contributions to its 401k plan trusts, Assistant Secretary of Labor Phyllis Borzi, the new head of EBSA, intends to get even tougher. Source: Baker, Donelson, Bearman, Caldwell & Berkowitz, PC

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BPP401k.com Newsletter December 2

Recovering from a Wild Ride: How to Plot a Less Precipitous Path for Retirement Plans Given what has happened in the markets, both employers and employees now recognize the increased importance of controlling risk. Plan design approaches that better balance surety and risk for both groups should be a key component of future plan design considerations. Source: Sibson Consulting BPP Plan Design Services

Fiduciary Duty: What's All the Fuss About? In a sixty-second video seminar, Dow Jones Newswires Reporter Shelly Banjo explains what the so-called fiduciary standard entails and why this duty of care is being debated by investors, Congressmen and financial planning groups. Source: Wall Street Journal

PLANSPONSOR's 2009 Defined Contribution Survey

Study of Employee Benefits: 2009 & Beyond Given the extraordinary challenges and the potential changes facing plan sponsors, the need for sound benefits strategy and planning has never been greater. Benefits professionals are playing an increasingly important role as plan sponsors seek expert advice and guidance on maintaining the competitiveness of their benefits programs while managing costs effectively. This study looks at these and other trends that will continue to shape the employee benefits landscape over the next five years. Source: Prudential

Show Them the Value: A Companion Report to the Study of Employee Benefits: 2009 & Beyond This companion report to the Study of Employee Benefits: 2009 & Beyond from Prudential provides quick access to the most salient findings as related to one of the main report's key themes: "Show Them the Value." This theme focuses on the importance of helping workers understand and appreciate the value of their employee benefits. Source: Prudential

Qualified Retirement Plans: End of Year Compliance Items The Pension Protection Act of 2006 made several changes to the laws governing qualified retirement plans and requires documentary and operational changes to such plans by the end of the 2009 plan year. This article is a brief summary of each of those changes. Source: Bryan Cave LLP

Recovery in 401k Balances One of the questions posed following the 2008–2009 market decline was: How long will it take for 401k plan participants to recover the wealth they attained at the peak of global stock prices in October 2007? This new "Research Note" from Vanguard Center for Retirement Research provides an answer: For the median plan participant at Vanguard, recovery took about two years. The main reason—ongoing contributions. Source: Vanguard Center for Retirement Research

Hardship Withdrawals Are Hard for Everyone It's not just HR that hardship withdrawals and loans hurt. For the participant, it means a possible and often unexpected tax bill next year. For the plan Adviser, it means depleting the plan's assets. Source: Benefits Selling

Fiduciary Q&A on the Status of Regulatory Reform At a Market counsel conference this fall, Kristina Fausti, director of legal and regulatory affairs for fi360, took part in a roundtable on regulatory developments and the emergence of a harmonized fiduciary standard. One thing became apparent to her: Most advisors are still not clear on the issues. Here is her take on what is happening. Source: Financial-Planning.com

Company Stock Can Be Source of Fiduciary Worry Some sponsors view their company's stock as a way to allow employees to share in the firm's growth. Some plans may even be designed to provide a company match in the form of stock. But the recent spate of lawsuits raises the question: Should company stock be a cause of fiduciary worry for plan sponsors? Source: Vanguard

Sensible Transparency for Retirement Plans Act -- H.R. 4146 This is the text of a new bill (H.R. 4146) that would amend title I of the Employee Retirement Income Security Act of 1974 to provide for disclosure regarding compensation for services to pension plans. Source: American Benefits Council

Eighth Circuit Court of Appeals Has Reversed the Dismissal of Wal-Mart 401k Fee Case Keller Rohrback LLP announced that the Eighth Circuit Court of Appeals reversed and remanded a decision by the district court for the Western District of Missouri that had dismissed, in October of 2008, Plaintiff Jeremy Braden's ERISA class action lawsuit filed on behalf of a class of participants and beneficiaries of the Wal-Mart Profit Sharing and 401k Plan. Source: 401khelpcenter.com

403(b) Universal Availability The universal availability requirement applies to all 403(b)s, except for church plans. The universal availability rule permits all the right to defer and thus does not favor HCEs; and because the ability to make deferrals is universally available, there is no ADP test. Source: McKay Hochman

401k Plans and Race Data sources show a disparity among racial and ethnic groups regarding participation in and contributions to 401k plans. In this study, the first section documents the differentials in eligibility, participation, and contribution rate by race. The second section reports how the race variables are affected once demographic and plan variables are included. The third section concludes that while additional variables can eliminate the significance of race, all is not necessarily right with the world. Source: Center for Retirement Research at Boston College

Company Stock Holdings Continued to Shrink in 401k Accounts According to the latest update of the EBRI/ICI 401k database, 401k participants continue to trim their investment in company stock, with this asset allocation category falling by nearly 1 percentage point (to an average of 9.7 percent) in 2008. Source: Employee Benefit Research Institute

IRS Offers Insight on Recent Guidance Relating to Retirement Plan Distributions Recently, the IRS hosted a phone forum during which IRS representatives discussed certain of the guidance issued this fall that relate to retirement plan distributions and addressed practitioner questions. This article summarizes the content of the IRS guidance, and, where applicable, highlights the comments made by IRS representatives during the recent phone forum. Source: Proskauer Rose LLP

IRS's Retirement News for Employers -- Fall 2009 This edition includes articles such as Roth & Roll: 2010 Roth IRAs & Rollovers; 5500 for 2009 and Later Required to be Filed Electronically; Establishing a SEP or SIMPLE IRA Plan; IRA Investments; New Web Tool for SARSEP Plans; and more. Source: IRS

QDIA Notice Rules Since issuing the final regulations detailing the QDIA notice requirements the DOL has published additional guidance. This article will outline the final QDIA notice rules, and additional guidance, and also provide links to related QDIA information. Source: McKay Hochman

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