BPP401k.com Newsletter January 26

Advisor Service Agreements: The Weak Link While a well drafted, reviewed and understood service agreement can help preclude errors and claims, the service agreement is also the primary defense against liability caused by service provider mistakes and negligence. In spite of this important role, many plan sponsors - particularly small plan sponsors - sign standard service agreements without adequate review or counsel. Source: Pension Risk Matters.

Many Miss Out On Retirement Tax Credit The Saver's Credit is designed as an incentive for low- to middle-income workers to save for retirement. But, according to the Transamerica Center for Retirement Studies, very few workers who may be eligible may even know it exists. Source: Thestreet.com

Best Practices: Conducting Provider Searches for Plan Sponsor Clients Selecting a service provider represents an even greater challenge than it has in the past as employer sponsored plans become more critical in both attracting and retaining employees and in meeting the retirement planning needs of the participating employees. This paper highlights the best practices for conducting a provider search. Source: Principal Financial Services

3 Tips for a Less Confusing 401k If you get confused about choosing a mutual fund for your investment portfolio or 401k plan, there may be a reason. It’s because the companies intentionally make the process of selecting a mutual fund more complicated. Source: Investor Place

The Costs to Employers of Having Employees Who Are Unable to Retire Our company is trying to decide whether a retirement preparedness program is worth the cost. What are the costs to an employer of having employees who aren't able to retire? Source: 401khelpcenter.com

403(b) Plans Best Practices Document The SPARK Institute has released for public comment a draft of an update to its information sharing best practices for 403(b) plans. The update reflects certain industry developments that occurred since it was originally published in June 2009. Source: SPARK Institute

5 Ways to Make Your 401(k) Balance Last Longer If you spend too much of your 401(k) account balance early on in retirement, you will reach your later years with very limited resources. But there are steps you can take to make your retirement account balance last longer. Here are some strategies to make sure your retirement savings lasts the rest of your life. Source: US News

Retirement Advice Along Gender Lines Men and women have distinct approaches to financial management, according to a new survey from Charles Schwab. The firm found that in investors 50 and older, 47% of men trust only themselves to make the right financial decisions, compared to 32% of women. Source: Employee Benefit News.

Boomers Hitting Retirement With Fewer Assets in Hand As the first wave of Boomers, those born between 1946 and 1955, enter retirement they are doing so with on average 12% fewer assets today than they had four years ago. This and other findings are included in the recently released Cogent Research 2011 Investor Brandscape report. Source: 401khelpcenter.com

AUDIO: New Directions For Professional Practices Doctors, lawyers, architects and other professional groups have unique business structures. Fortunately, new ideas for the design and management of retirement plans for professional practices can meet their needs. An interview with Pete Swisher, Sr. Institutional Consultant, Unified Trust Company on these new ideas. Source: BigMediaUSA.com (mp3).

Survey: Client Service Now Key to Retirement Plan Buying Decisions According to a new survey by Anova Consulting Group, retirement plan sponsors report that client service has now become the #1 or #2 reason for choosing a new plan provider over a rival firm. Source: 401khelpcenter.com

Stable Value Funds: Performance to Date Little in the scholarly economics literature is directed specifically to stable value funds, although they occupy a leading place among retirement investment vehicles. This study suggests that stable value funds dominate two (and nearly three) major asset classes based on a historical analysis, and that they often occupy a significant position in optimal portfolios across a broad range of risk aversion levels. Source: Social Science Research Network.

Analyzing Defaulted Participant Behavior and QDIA Target-Date Design Are target-date funds serving the needs of defaulted participants? Prompted by the extreme markets in 2008, this question has dominated industry discussion about the suitability of different target-date strategies as qualified default investment alternatives. Source: PIonline.com

More U.S. Households 'At Risk' of Running Short of Money in Retirement Depending largely on age and income, between 4 percent and 14 percent of Americans who otherwise would have had adequate income to cover basic expenses in retirement became "at risk" of running short because of the housing and financial crisis of 2008–2009, according to a new report by the nonpartisan Employee Benefit Research Institute. Source: Employee Benefit Research Institute

DOL Pushes Intensified Scrutiny of ESOP Fiduciaries The Department of Labor says the proposed regulation is designed to clarify which adviser roles carry fiduciary responsibility under federal law. The department's main complaint is that the current rule is old and doesn't work considering the significant changes in the financial industry as well as the massive shift to defined contribution plans. Source: Workforce.com (free registration may be required).

SEC's Fiduciary Study Released The Securities and Exchange Commission submitted to Congress a staff study recommending a uniform fiduciary standard of conduct for broker-dealers and investment advisers -- no less stringent than currently applied to investment advisers under the Advisers Act -- when those financial professionals provide personalized investment advice about securities to retail investors. Source: SEC.

SEC Staff Study Recommending a Uniform Fiduciary Standard This is the actual study just released by the SEC. It recommends that the SEC should adopt rules implementing a uniform fiduciary standard for Broker-Dealers and Investment Advisers that requires them to act in the best interest of the client without regard to the financial or other interests of the broker or adviser. Source: SEC

Participant Fee Disclosure Regulations – Methods of Delivery and Effective Date This is an article regarding the October 2010 participant fee disclosure regulations which discusses the method of delivery of these disclosures and the effective date of the new regulations. Source: Sungard/Relius.

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