BPP401k.com Newsletter July 27

Gateway St. Louis ASPPA Benefits Council Formed ASPPA Benefits Councils (ABCs) offer education and networking at the local level. In addition, ASPPA members are provided a convenient way to earn continuing education credits by participating in ABC activities. ABCs have access to ASPPA's speakers bureau, government affairs activities and education programs, keeping members current with industry developments. For information and to join the chapter email Jason Oesterlei.

401(k) Expense Ratios Average 71 Basis Points; Most Invested In No-Load Funds Average expense ratios for 401(k) plan assets held in stock mutual funds have fluctuated between 71 basis points and 75 basis points for the past five years, according to the Investment Company Institute (ICI) Source: Wolters Kluwer

Retirement Plan Audits, From the CPA Perspective At last week's Northeast Area Benefits Conference, co-sponsored by the IRS and ASPPA, two Certified Public Accountants discussed the many moving parts of a retirement plan audit. Source: Planadviser.com.

7 Signs of a Good 401k Plan The recession has made employers less likely to contribute to workers' retirement savings, or less generous with the options they do provide. Source: MSN Money

Best Practices in Financial Education for Gen X: A Generation Caught in the Middle Gen X has a different world view - one where there are no guarantees. The economic situation they came of age in gave them a more skeptical outlook than other generations. Overall, Generation X employees have formidable challenges in planning for retirement, but financial education that is tailored to this generation can help. Here are some best practices in financial education for Generation X employees. Source: 401khelpcenter.com.

Work Later in Retirement? For Many, it Won't Be Enough If you can't afford to retire at 65, how long after that will you have to work before you have enough money? A new analysis by the nonpartisan Employee Benefit Research Institute finds that for many people, it could be a very long time -- for lower-income workers especially, well into their 70's. Source: Employee Benefit Research Institute

401k Plan Sponsors: Is It Time for a Fee Policy? Plan sponsors need to have in place a rigorous governance process to deal with fee decisions and to explain their decision-making to plan participants if necessary. As part of this process, plan sponsors are establishing formal Fee Policy Supplements to Investment Policy Statements to govern fee decisions and importantly, to demonstrate prudent process. Source: Orrick, Herrington & Sutcliffe LLP.

HR Focuses on Retirement-Plan Governance The number of lawsuits, combined with regulatory complexity, the growing cost of benefits and the volatility of investments, has motivated some U.S. companies to beef up the governance of their retirement plans, say experts. But relatively few are proactively addressing governance risks. Source: HREonline.com.

Qualified Plan & IRA Creditor Protection Rules Creditor protection rules differ between retirement accounts held within qualified plans subject to Title I of ERISA and Individual Retirement Accounts (IRAs). Participants in qualified retirement plans that are subject to Title I of ERISA should consider the degree of creditor protection afforded when deciding whether to leave their accounts in the qualified retirement plan or rolling them out of the plan into an IRA. Source: McKay Hochman.

A New Plan Design Feature for Qualified Plans: The Roth "In-Plan" Rollover A summary of the prior law is set forth in this four page article that was first published in the Journal of Pension Benefits. Also included is a summary of the new provision and the IRS guidance issued to facilitate implementing the provision. Lastly, the article reviews the key implementation steps when adding the new Roth rollover feature. Source: Groom Law Group

Retirement Calculators Threaten the Stability of Your Entire Plan Having a retirement calculator should be a good thing. It helps to perform computations and projections that would otherwise be out of reach to the common 401k participant. Most calculators, without much input other than simple variables, can determine what your savings goal should be. But with a goal established, now what? Source: Invest n Retire.

Expert Discusses Elements of a Legally Sound Handbook Christine V. Walters, MAS, JD, SPHR, discussed how to develop or improve upon various handbook sections and what they should be used for. Source: CCH.

Fiduciary Liability Policies May Not Cover Costs Associated With DOL Investigations Responding to DOL investigations can result in significant expenses -- including legal fees -- even if no violations ultimately are uncovered. This article discusses how a plan's fiduciary liability insurance carrier might respond to claims related to these Department of Labor investigations. Source: Segal Group

New Reality: Pensions Have Become an Acceptable Expense Companies have successfully shifted a considerable amount of the risk associated with DB programs to set DC programs, transferring the risk from the company to the individual. The result is a legacy program which over the next several decades will mostly work its way out of the last bastions of the U.S. labor market, and out of existence. Source: Businessweek.com.

403(b) Transfers and Exchanges The final 403(b) regulations changed the terminology for "transfers" and "exchanges" that take place on or after September 25, 2007. This impacts the methods used to move 403(b) accounts of participants and beneficiaries. Source: McKay Hochman.

Provider Tenure Less Than Three Years in 30% of Retirement Plan A Spectrem Group study looked at the switching behaviors of plan sponsors and found that nearly a third who changed retirement plans in the past 12 months had been with their previous provider less than three years. Source: FA-mag.com.

Retirement Income and the 4% Rule Is it prudent to set a withdrawal rate of 4% from a portfolio that is intended to support retirement income? For many years, 4% has been the “rule of thumb” in financial planning community. But the 4% rule is controversial, and there are strong opinions on both sides. Source: Schultz Collins Lawson Chambers

Final Regulation on Participant-Level Fee Disclosures MetLife announced that it is has prepared this white paper entitled, Final Regulation on Participant-Level Fee Disclosures, to help plan administrators understand their new obligations regarding the communication of investment-related performance and fee information to ERISA plan participants. Source: MetLife

401k Match Motivates Retirement Saving Most workers are lured into 401k plans by the promise of an employer contribution. 401k matches are the primary reason that workers participate in 401k plans, according to a Boston Research Group survey of 1,000 current and retired 401k participants sponsored by Fidelity Investments. Source: U.S. News & World Report.

Not Saving Enough and Living Beyond Means Are Top Obstacles to Financial Success Americans continue to show resilience post-financial crisis, but a new study released by the Principal Financial Group and conducted by Harris Interactive reveals that many still need help to envision their financial dreams. Only 1 in 10 financial professionals said their clients find it easy to visualize their financial dreams, according to the study. Source: 401khelpcenter.com.

The Hartford Finds More Americans Saving for Retirement Despite a sluggish economy, more Americans say they are confident their personal finances will improve during the next 12 months. This trend is translating into more people saving for retirement, according to new research from The Hartford. Source: 401khelpcenter.com.

IRS Seeks Comments on Instructions for Requesting Rulings and Determination Letters The IRS is seeking comments on an extension of a currently approved collection of information in final regulations (T.D. 9006) concerning requirements for requesting rulings and determination letters. Written comments should be received on or before August 22, 2011. Source: CCH.

DOL Aligns Deadlines for Retirement Plan Fee Disclosures The final rule extends by three months the applicability date of the DOL's interim final rule on fee disclosures by plan service providers to plan sponsors/fiduciaries (known as ERISA section 408(b)(2) disclosures), and aligns that regulation with its previously issued final rule on quarterly fee disclosures by plan sponsors to plan participants. Source: Society for Human Resource Management.

Fee Disclosure Deadlines Extended On July 13th, 2011 the Department of Labor issued a final rule delaying the deadlines for compliance with the new fee disclosure regulations. This final rule affects both the participant level fee disclosure and the sponsor level fee disclosure. Source: Sentinel Benefits & Financial Group.

For more information about custom retirement plan design and how Benefit Plans Plus can help make your business more successful visit www.bpp401k.com

BPP401k.com Newsletter July 20

The Pros and Cons of Automatic 401k Enrollment A 2006 law designed to increase retirement savings allowed companies to auto-enroll employees in 401k plans. The debate on whether this is good or bad continues. Here's a practical list of five pros and five cons of 401k auto-enrollment. Source: DailyFinance.

Service Provider Fee Disclosure Requirements Amended The U.S. Department of Labor's (DOL) Employee Benefits Security Administration announced this week that it's amending the effective date of Service Provider Fee Disclosure Requirements under ERISA to April 1, 2012. In addition, the deadline for meeting participant-level disclosure under ERISA 404(a) has been extended to 60 days after the effective date of the 408(b)(2) requirements. The new deadline for issuing the initial participant-level disclosure is May 31, 2012.
This date extension from January 1, 2012 was based on the DOL's careful review of requested comments by service providers, plan fiduciaries and plan administrators for further guidance.
The DOL wants to ensure that thorough and accurate disclosures, in compliance with the final 408(b)(2) regulation, are furnished to plan fiduciaries to help them carefully analyze plan service contracts and arrangements in compliance with their fiduciary duties under ERISA. The change to the participant-level disclosure will align the sequence of disclosures so that the participant-level disclosure is effective after the plan sponsor disclosure. The DOL intends to publish a final 408(b)(2) regulation in the Federal Register before the end of the year, and does not expect that the changes to the "interim final regulations" are likely to require additional time for compliance. Source: Department of Labor

12th Annual Transamerica Retirement Survey The 12th Annual Transamerica Retirement Survey found that for the first time since the recession began, rising employer confidence is accompanied by an increase in enhancements to retirement benefits as well as reinstatement of benefits that had been suspended. Source: Transamerica Center for Retirement Studies

VIDEO: ASPPA Regulatory Update: Electronic Disclosure In this two minute video, ASPPA's General Counsel and Director of Regulatory Affairs, Craig Hoffman explains why it's crucial to harmonize the rules between the IRS and DOL for efficiency and to make electronic disclosure the default an option for participants. Source: ASPPA.

Effective Due Diligence for Guaranteed Lifetime Income Options This article highlights some of the critical issues and questions that companies must consider as they evaluate GLIOs for their own retirement plans and conduct due diligence about specific products. The viewpoint reflects conversations we have had with large insurers on their offerings to their own client base and plan sponsors as they explore whether these benefits should be included in their retirement plans. Source: Institutional Retirement Income Council

Target-Date Funds: Are They Hitting the Target Are target-date funds accomplishing their goal of providing long-term investment allocations that will provide growth, preservation of capital, and, finally, a secure nest egg for participants? This white paper reviews their progress, discuss the changes they have undergone, and ultimately ask the question, "Are they hitting the target?" Source: Arnerich Massena

Your 401k Plan Has Auto-Enrollment, Now What? There has been a good deal of discussion on success measures for auto-enrollment, and we've previously established that by adding auto-enrollment a plan sponsor can immediately make its plan appear to have 100% participation. But is that enough? Source: Milliman.

IRS Compliance Project Targets 403(b) Plans of Universities The Compliance Unit under the Employee Plans division of the Internal Revenue Service has begun a project to gather information from institutions of higher learning concerning compliance with the universal availability requirement for 403(b) plans. Questionnaires will be sent to a random national sample of 300 large, medium and small public and private higher education organizations sponsoring 403(b) plans. Source: PricewaterhouseCoopers LLP

Fiduciary Support Services Not a Differentiator for DC Plan Providers Although regulatory changes to fiduciary responsibilities and disclosures loom on the horizon, plan sponsors of all sizes say that strong fiduciary support services falls low on the list of factors that influence their choice of plan providers. While concerning, this lack of focus is a blessing for most plan providers who have yet to convince plan sponsors that they provide strong fiduciary support services. Source: 401khelpcenter.com.

SIFMA Gives SEC Ideas for a New Fiduciary Standard In anticipation of the agency's moving ahead with a rule that would require broker-dealers to meet the same requirements as investment advisers — acting in a client's best interests — the Securities Industry and Financial Markets Association laid out in a letter to the SEC what it called a fiduciary framework. Source: Investmentnews.com

Survey Finds Majority Would Not Be Saving for Retirement Without a 401k Fidelity Investments announced survey results that reveal more than half (55 percent) of current workplace savings plan participants say they would not be saving for retirement if not for their 401k plan. The research also found nearly one in five respondents (19 percent) currently enrolled in workplace plans report they have no retirement savings at all outside this key retirement benefit. Source: 401khelpcenter.com.

Retirement Timelines Fade Amid Uncertainty as More Americans Stay on the Job Shifting and uncertain target dates for retirement are becoming the norm in the American workforce, making it harder for employees to establish meaningful financial plans, recent MetLife research indicates. Source: 401khelpcenter.com.

Americans Focus on New Approach to Post-Recession Retirement Americans have emerged from the economic recession with a new set of expectations around the purpose, timing and funding of retirement, according to a new study sponsored by SunAmerica Financial Group in collaboration with Age Wave. Source: 401khelpcenter.com.

SunAmerica Retirement Re-Set Study This study reveals how retirement has changed in the past decade. Emerging from the recession, Americans are beginning to define retirement differently than previous generations of retirees. They now see it as a time for new priorities, new opportunities, and new solutions to today's challenges. This 24 page report provides a summary of findings. Source: SunAmerica

Rising Employer Confidence is Translating Into a Renewed Commitment to Retirement Benefits A new report released today reveals an encouraging sign that employer confidence is rising and that it appears to be translating into a renewed commitment to retirement benefits for the first time since the recession began. Source: 401khelpcenter.com.

What Employers Lose in the Shift From DB to DC Plans and How to Get it Back The four objectives of this white paper are to: 1) Highlight the plan design features that have been lost in the shift from DB to DC plans. 2) Identify the workforce management challenges posed by the shift from DB to DC plans. 3) Describe how incorporating income solutions into DC plans can help address these challenges. 4) Provide a case study that demonstrates the benefits of incorporating income solutions into DC plans for employers and employees. Source: Prudential

Analysis: Capping Tax-Preferred 401k Contributions Will Hurt All Workers A new analysis from the nonpartisan Employee Benefit Research Institute finds that the National Commission on Fiscal Responsibility and Reform proposed tax reform for 401k-type retirement plans would cause the greatest reduction in retirement savings for both the highest- and lowest-income workers. Source: 401khelpcenter.com.

What CIGNA v. Amara Means for You In a move that might open the door to more lawsuits, the U.S. Supreme Court decided on May 16 in CIGNA Corp. et al. v. Amara et al. that a summary plan description is not the plan document and therefore not legally binding. This article provides a summary of the case and highlights some key issues the courts raised. Source: ERISAdiagnostics.com

Deadlines Revised; Prepare Now for New Rules for Retirement Plan Fiduciaries The DOL has slightly delayed the deadlines on significant new affirmative obligations for fiduciaries of retirement plans subject to ERISA. Although the deadlines have been pushed back to April 1, 2012, employers should be preparing now to ensure that they are ready to comply with the new requirements. Source: Ballard Spahr.

DOL Extends Deadlines for Fiduciary and Participant Level Disclosures On July 13, 2011, the DOL issued new guidance delaying the effective date of the new fiduciary-level disclosure rules required by interim final regulations under Section 408(b)(2) of ERISA until April 1, 2012. The DOL's new guidance also delayed the date that initial participant-level fee disclosures must be provided under the final regulations under Sections 404(a) and 404(c) of ERISA (the "Participant Disclosure Regulations"). Source: Proskauer Rose LLP.

For more information about custom retirement plan design and how Benefit Plans Plus can help make your business more successful visit www.bpp401k.com

BPP401k.com Newsletter July 13

25 Years After Federal Pension Reform As various states grapple with reforming their public employee pension systems, the experience of how the federal government managed pension
reform 25 years ago may provide some useful background to governors and
state legislatures. Source: EBRI.org

Five Things You Need to Know about Being a Fiduciary Plan committees can’t eliminate their fiduciary liability, although they may be able to hand some of it off. Source: Plan Sponsor

Social media is effective with ultra-wealthy clients but forget the Morgan Stanley approach Social media checklist needed to effectively reach out to wealthy clients. Source: RIA Biz

Morgan Stanley Advisers to Start Using Twitter, LinkedIn: Fair Warning In May, financial industry giant Morgan Stanley decided to allow its brokers to begin using social media in the course of their jobs. Since the use of social media tools like LinkedIn, Twitter and even Facebook have become mainstream methods of doing business for most industries, the financial industry has, somewhat understandably, been dragging its feet. Source: Jaggers Communications

Missteps in Benefits Communications Communications that are infrequent and indecipherable are common mistakes HR leaders make when transmitting information about benefits packages to employees. Using more of a "selling" approach while adopting multiple channels and targeted messages will help, experts say. Source: HREonline.com.

Conerly on the Economy for July 2011 "Conerly on the Economy" displays charts of the most important economic indicators, with Bill's comments on the charts and the outlook. Bill Conerly connects the dots between the economy and business decisions, helping corporate executives and small business owners make more profitable decisions. Source: Conerly Consulting

VIDEO: Best Practices in Retirement Plan Communications Robert Benish, COO of the Profit Sharing/401k Council of America, speaks to how plan sponsors can create effective retirement plan communications. Four minutes. Source: Employee Benefit News.

Managers Shift Thinking on Target-Date Fund Management Approach In Callan's 2011 Target-Date Fund Survey: The Evolving Target-Date Fund, it is clear that target-date funds continue to evolve as managers evaluate their glidepaths and the use of underlying funds. In March 2011, Callan surveyed 26 target-date fund managers representing $375 billion and 35 unique target-date series to get their take on management approaches, glidepath design and anticipated changes. Source: 401khelpcenter.com.

The Workings of the "Open" Multiple Employer 401k Plan A "Multiple Employer" 401k plan ("MEP"), where a single 401k plan is jointly sponsored by a number of unrelated employers, can often provide a cost effective way for some employers to manage their risks related to sponsoring a 401k plan, while enjoying advantageous pricing on investments and administrative services to which they may not otherwise have access. This white paper addresses the issues giving rise to some of this confusion related to these Open MEPs. Source: Benefitslink.com

Fiduciary Roles Played by Plan Sponsors and Outside Advisors David Levine of Groom Law Group discusses how plan sponsors and fiduciaries attempt to manage their litigation risk by using process and documentation, as well as by outsourcing fiduciary oversight if needed. He talks about the importance of evaluating fees, including understanding what your plan is receiving for those fees. He shares his views on selecting investments, whether active, passive, or a qualified default investment alternative. David wraps up by underscoring the necessity to document plan decisions and process. Source: PIMCO

Pay to Play in 401k? Pimco, Dodge & Cox, American Funds Eyed A brief look at the estimated $3.5 billion a year paid by mutual funds to packagers of 401k and related defined contribution plans. Source: Barrons.

Target-Date Investing Trends and Opportunities With their emphasis on one-stop diversification and active asset allocation, target-date funds are taking center stage in DC offerings. The defined contribution world, however, faces a fundamental dilemma. While everyone from plan sponsors and recordkeepers to investment managers and advisers is trying to increase the certainty of participants' retirement income, the participants themselves still determine how much to save, where to invest and when to withdraw from the plan. Building a successful target-date approach requires an understanding of the interactions among participants' inputs into the DC dilemma. Source: J.P. Morgan

Regulations and Costs Shaping Future of 401k Plans According to FRC Study Continued scrutiny by regulators and legislators on the fees and outcomes of defined contribution (DC) plans is pressuring revenues at organizations that provide the products and services to these plans, and will shape the future of the DC retirement plan market, according to a new study, Trends in Retirement/401k Plans and Administration, published by Financial Research Corporation. Source: 401khelpcenter.com.

Vanguard Issues New Profile of Participant Trends in 401k Plans of Eight Industries For the first time, supplemental industry reports to How America Saves analyze the behavior of plan participants in eight industries, including the ambulatory health care; finance and insurance; information services; legal services; manufacturing; mining, oil and gas extraction; technology; and utility industries. Plan sponsors in these industries can use a new benchmarking tool to compare their plan data with others in their industry and Vanguard plans overall. Source: 401khelpcenter.com.

Survey Finds Vast Majority of Retirement Plan Advisors Currently Performing Fiduciary Functions Eighty-five percent of retirement plan advisors are currently performing services traditionally performed by plan fiduciaries, although most are not declared plan fiduciaries, according to a national industry survey of external retirement plan advisors conducted for John Hancock Financial Network by Pulse Logic. Source: 401khelpcenter.com.

Too Many Choices Impair 401k Decisions When individuals are faced with too many options they become paralyzed and don't make the best decisions -- even when it comes to 401k options, according to a new study co-authored by Columbia Business School and University of Chicago Booth School of Business. Source: Employee Benefit News.

ERISA Litigation Newsletter - July This month provides an update on the developing law regarding the "fiduciary exception" to attorney-client privilege and the work product doctrine. This "exception" often confounds in-house and outside counsel alike, and the article concludes with some best practices suggestions. Also highlighted is a U.S. Supreme Court decision from this term, AT&T Mobility v. Concepcion, which held that the Federal Arbitration Act preempts a state law prohibiting waivers of class arbitration. The article discusses the decision's potential implications for employee benefits practitioners. Source: Proskauer Rose LLP.

Web Page Created on Proposed Definition of Fiduciary Regulation The DOL has created this web page containing comments and interviews by Assistant Secretary Phyllis C. Borzi on the proposed regulation on the definition of a fiduciary, public hearing written testimony, and all public comments submitted on the proposed rule. Source: U.S. Department of Labor.

Options for Filing 2010 Form 8955-SSA The IRS has released the 2009 Form 8955-SSA but has yet to release the 2010 Form. However, the clock, though much delayed, has started to run for the deadline to file the 2010 Form. Practitioners have several options in reporting individuals who should be reported on the 2010 Form. This article discusses the 2010 Form and the options relating to it. Source: Sungard/Relius.

Amending a Form 5500 (or filing a late Form 5500): Which Forms Do I Use? There has been much confusion as to which forms a preparer should use in amending a Form 5500 filing or in filing a late Form 5500. Much of the uncertainty stems from conflicting statements made in the wake of the transition to electronic filing. In a recent Form 5500 software developer's conference, the DOL addressed the issues and provided the following answers. Source: Sungard/Relius.

DOL Opines on Scope of PTE 86-128 In Advisory Opinion 2011-08A (June 21, 2011), the DOL concluded that ERISA "investment advice" fiduciaries are within the scope of Prohibited Transaction Exemption 86-128, thus confirming the availability of conditional relief for such a fiduciary (or an affiliate) to effect securities transactions or cross trades for a fee as an agent for an ERISA plan. Source: Sutherland Asbill & Brennan LLP

For more information about custom retirement plan design and how Benefit Plans Plus can help make your business more successful visit www.bpp401k.com

BPP401k.com Newsletter July 6

Target date funds may be right choice for many workers BPP's Patrick Shelton weighs in on target date funds and how the investment industry makes the complex seem simple. Source: Stltoday.com

Dalbar Creates Registered Fiduciary Program for 401(k) Advisors Retirement plan advisors who acknowledge their fiduciary status now have a new way to strut their stuff. Dalbar has unveiled its new 401(k) Registered Fiduciary designation program. Source: Financial Planning

Average 401k Expense Ratio Declines According to an annual report by the Investment Company Institute, 401k plan participants invested in stock mutual funds on average paid lower expense ratios in 2010. Source: Planadviser.com.

Why Small Business Now Has the 401k Benefits Edge on Big Business Whether you have one employee or a hundred, it's becoming much easier for small businesses to provide a better 401k benefit than large company plans. This is a stark contrast to the way things have been for years and can be a huge advantage to small businesses in attracting and retaining top talent. So what's making this all possible? Two things. Source: Forbes.

IRS Gets Better at Catching Illegal Retirement Plans The Treasury Inspector General for Tax Administration found that the IRS has improved its process for selecting potentially noncompliant retirement plans for examination. This has resulted in an increase in the percentage of examinations where the IRS detects noncompliance with the Tax Code. Source: Accountingtoday.com.

Does It Ever Make Sense to Reduce Your 401k Contributions? Financial planners typically recommend that people save more for retirement in their 401k. There are lots of reasons that this is usually good advice, such as the tax benefits, the convenience of payroll deductions, and maybe an employer match. But can it ever make sense to reduce your 401k contributions? Source: Forbes.

401k Companions May Widen Retirement Safety Net The financial and emotional scars of the bear market still have many Baby Boomers in limbo, unsure if their savings will last their lifetime. Keying on those worries, the 401k industry has started providing products designed to help transform savings into steady paychecks that will be a safety net throughout retirement. Source: USAToday.com.

Re-thinking Target Date Funds: No Magic Formula Is the conceptual design behind Target Date Funds sufficiently robust to warrant the claim of being "the" ideal solution for defined contribution retirement plans? This article aims to make the case for a complete and consistent framework to vet the risk-and-return proposition of TDFs. In particular, financial operators and regulators should re-examine the existing TDF solutions and encourage more accurate disclosure of the expected risks and returns of each product in a manner consistent with (a) rigorous analysis based on commonly accepted financial theory and (b) realistic empirical market evidence. Source: Buck Consultants

AUDIO: The Fiduciary Standard With Blaine Aiken of Fi360 The Don Davidson 401k Podcast is a conversation with guest experts about the 401k world. This 17 minute podcast is with Blaine Aiken of Fi360 on the "fiduciary standard." Source: Advisorsaccess.com.

Ex-Employees Who Don't Rollover – Will 401k Fees Increase Plan Sponsor Liability? There's often a debate as to what's in the best interest of ex-employees: to keep their retirement assets in their former company's 401k or to roll those assets over into an IRA? What's often overlooked in this calculation is whether this individual decision can inadvertently increase the fiduciary liability of the 401k plan sponsor at the former firm. Source: Fiduciary News.

Have You Looked at Your Investment Committee Lately? The committee by-laws are essential for establishing the process by which the committee operates. Other industry best practices with respect to investment committees include nine items. Source: Fi360.com.

Economics of Providing 401k Plans: Services, Fees, and Expenses As part of an ongoing comprehensive research program, the Investment Company Institute conducts research to shed light on the services, fees, and expenses within 401k plans. Among ICI's findings reported here, the asset-weighted average expense ratio paid by 401k investors on their stock funds dropped 3 basis points to 0.71 percent. The asset-weighted average expense ratio paid on their bond funds remained unchanged at 0.56 percent. Source: Investment Company Institute

DC Plan Participants Recognize Benefits of Automatic Investment Programs Automatic enrollment continued its upward trend, climbing three points since 2009 to 24% of plans. Participation, however, fell slightly to 74%. Economic conditions that prevented people from contributing offset gains made by automatic enrollment. Almost 30% of 401k participants are enrolled in automatic professionally managed investment programs, including target-date or balanced funds or a managed account advisory service, according to a study released Wednesday by Vanguard. Source: Advisorone.com.

Three Key Variables That Drive Retirement Preparedness In a recent survey of nearly 3,300 working Americans to help determine current levels of retirement preparedness, Putnam Investments identified three key variables that drive successful outcomes. The most powerful factor, regardless of income level, is a pattern of disciplined, long-term savings and investing. Source: 401khelpcenter.com.

SHRM's 2011 Employee Benefits Research Report SHRM's 2011 Employee Benefits research report provides comprehensive information about the types of benefits U.S. employers offer to their employees. In 2011, 284 benefits were explored, covering the areas of health care and welfare benefits, preventive health and wellness benefits, retirement savings and planning benefits, financial and compensation benefits, leave benefits, family-friendly benefits, flexible working benefits, employee services benefits, housing and relocation benefits, and business travel benefits. The report also examines trends in employee benefit offerings over the last five years. Source: Society for Human Resource Management.

Survey Shows Gap Between Employer Concern and Action Over Plan Compliance Managing and governing retirement plans has become increasingly difficult and time-consuming for plan sponsors over the past few years, especially as costs have risen and regulations have grown more complex. The Towers Watson survey found that 40% of employers expect to devote more time addressing retirement plan governance issues over the next two years, while only 2% anticipate spending less time. Among those respondents that expect to spend more time on plan governance, a vast majority (86%) cited regulatory complexity as a major reason. Source: 401khelpcenter.com.

Ensuring Income Throughout Retirement Requires Difficult Choices GAO was asked to review (1) strategies that experts recommend retirees employ to ensure income throughout retirement, (2) choices retirees have made for managing their pension and financial assets for generating income, and (3) policy options available to ensure income throughout retirement and their advantages and disadvantages. Source: Government Accountability Office

Report on Total U.S. Retirement Assets Total U.S. retirement assets were $18.1 trillion as of March 31, 2011, up 3.0 percent from year-end 2010 and just below the all-time high reached at the end of the third quarter of 2007. Retirement savings accounted for 37 percent of all household financial assets in the United States at the end of the first quarter of 2011. Source: Investment Company Institute.

Study: Money Trumps Age When Determining Start of Retirement Three out of four (73 percent) of our nation's middle-income Baby Boomers say that their financial situation, not age, is now the key trigger for when to retire, according to a recent study conducted by the Bankers Life and Casualty Company Center for a Secure Retirement. Source: 401khelpcenter.com.

New Puerto Rico Tax Code Requires Big Changes to Retirement Plans for Puerto Rico Employees On January 31, 2011, the Commonwealth of Puerto Rico adopted a new Internal Revenue Code which substantially overhauls the tax qualification requirements for retirement plans that cover Puerto Rican employees. The qualified retirement plan provisions found in the 2011 PR Code contain requirements that parallel the requirements found in Section 401(a) of the US Internal Revenue Code. However, the 2011 PR Code made a number of significant changes thereby creating differences between the U.S. Code and the 2011 PR Code. Employers sponsoring Puerto Rican plans or United States plans covering Puerto Rican employees should review their plans. Source: Wagner Law Group

Qualified Pension Plans for Puerto Rico Employees -- The Perfect Storm Has Arrived Over the past few years, a number of law changes have impacted the coverage of Puerto Rico employees in U.S. tax-qualified pension plans. Today, these law changes come together to create the perfect storm -- creating new challenges in finding the right retirement vehicle to provide tax-favored pension benefits to bona fide Puerto Rico employees. The elements of the "perfect storm" are described in this article. Source: Groom Law Group

DOL's Borzi Fights Critics of Proposed Fiduciary Rule Phyllis Borzi, head of the Department of Labor's Employee Benefits Security Administration, fought back on recently against criticisms EBSA has received regarding its controversial regulation amending the definition of fiduciary under ERISA. Source: Advisor One.

SEC Fiduciary Rule 'Likely' This Year, but Not Harmonization A senior official at the Securities and Exchange Commission said that while he believed the securities regulator would issue a rule putting brokers under a fiduciary mandate this year, the agency would hold off on issuing one on the overall harmonization of advisor and broker rules. Source: Advisor One.

For more information about custom retirement plan design and how Benefit Plans Plus can help make your business more successful visit www.bpp401k.com