2013NAFE (2013 NIPA Annual Forum & Expo)

Sr. 401(k)/DC Plan Admin Specialist
for CUNA Mutual Group in WI

Account Executive II - Retirement Services
for Principal Financial Group in WA

401(k) Recordkeeping Specialist
for Pen-Cal Administrators, Inc. in CA

Relationship Manager
for Aspire Financial Services in CO

Conversion Consultant
for Aspire Financial Services in FL

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Understanding the Department of Labor?s Changes to Form 5500 to Reflect the New MEWA Rules Nationwide on April 16, 2013 presented by Thompson Interactive

Taxation of Fringe Benefits and Today?s Hot Issues Nationwide on April 17, 2013 presented by Thompson Interactive

Mastering New Compliance and Best Practices for Hiring People with Disabilities Nationwide on April 30, 2013 presented by Thompson Interactive

Building and Implementing Effective Telework Policy for Employees Nationwide on May 9, 2013 presented by Thompson Interactive

HealthEquity Hosts Free Webinar Series: The Effects of Health Care Reform on Health Savings Accounts Nationwide on April 17, 2013 presented by HealthEquity

"401(k) Plan Workshop 2013: Tax Reform and the 401(k) Plan" - Chicago in Illinois on May 10, 2013 presented by SunGard Relius

"401(k) Plan Workshop 2013: Tax Reform and the 401(k) Plan" - Cleveland in Ohio on May 10, 2013 presented by SunGard Relius

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[Official Guidance]

FY-2014 Budget Proposal: Treasury Department's General Explanations of Certain Retirement Related Provisions (PDF)
Significant provisions affecting retirement plans and individuals, extracted by The SPARK Institute from the official Treasury Department budget explanation. (U.S. Department of the Treasury, via The SPARK Institute)

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[Guidance Overview]

Consequences of Retirement Plan Disqualification
"The statute of limitations with respect to the employer's tax deduction for plan contributions is three years after the later of: (1) the due date of the employer's tax return, or (2) the filing date of the employer's tax return.... The general statute of limitations for imposing additional tax upon participants is three years after the later of: (1) the due date of the individual's tax return, or (2) the filing date of the individual's tax return. However, the statute of limitations increases to six years if the failure to include income results in a 25% or more understatement of gross income." (SunGard Relius)

How Obama's Budget Impacts Retirement Savers
"Chained CPI.... New retirement account limits.... Automatic IRAs.... Close the Medicare Part D donut hole sooner.... Higher premiums for high income Medicare beneficiaries.... New Medicare co-pays." (U.S.News and World Report)

Administration Proposes to Let PBGC Board Set Premiums in Effort to Shore Up Finances
"Under the current proposal, the PBGC Board, which consists of secretaries of Labor, Commerce, and Treasury, with the secretary of Labor as chair, wouldn't get the authority to set rates until 2015. The budget requires the board to perform a one-year study with a public comment period. Additionally, premium increases would be gradually phased in to give company sponsors time to prepare for the new rates." (Solutions Law Press)

Obama Administration Renews Call to give PBGC's Board Control over Premium Rates
"'Without premium increases PBGC will be faced with requesting a taxpayer bailout or shutting down,' said PBGC Director Josh Gotbaum. 'The current system punishes responsible companies by making them pay for the mistakes of others and punishes plans by raising rates just when companies can least afford it.' ... The Administration reintroduced the effort that ties premiums to company risk in its 2014 budget." (Pension Benefit Guaranty Corporation)

[Advert.]

Learn, Network and Sell at the SPARK National Retirement Industry Conference - June 16-18, Washington DC

Join top industry recordkeepers, asset managers, TPAs, advisors, marketing and sales executives for unequaled educational and networking opportunities. Learn the latest market trends, business strategies, regulatory and legislative issues, and product developments.

Obama Budget Would Increase Federal Employees' Pension Contributions
"President Obama wants federal employees to contribute 1.2 percent more of their pay, phased in over the next three years, toward their pensions ... Right now, most enrollees in the Federal Employees Retirement System contribute 0.8 percent of their pay to their pensions[.]" (GovExec.com)

Fourth Quarter Saw Increase in Participant Loans
"[I]n the fourth quarter of 2012, there was a 28 percent increase in the number of people taking loans out from their 401(k) ... [T]he average new loan balances increased to $7,126 from those taken out in the fourth quarter of 2011 -- a 7% increase from $6,662. Of the participants who took out loans, the greatest percentage were to people in their 50s (34.2%), followed by those in their 60s (28.9%) and then by those in their 40s (27.3%). The increase among participants in their 50s was nearly double the increase among those under 30." (Wells Fargo)

Guaranteed Income Products Make Sense for Middle-Income Consumers
"A recent LIMRA study found that 90 percent of deferred annuity buyers said having enough income to last their lifetimes and to remain financially independent was their primary goal. The study also found supplementing Social Security and/or pension income in retirement was the most popular intended use among 55 percent of variable annuity buyers, 46 percent of indexed buyers and 42 percent of traditional fixed buyers." (LIMRA)

Throw Caution to the Wind? Not Young Boomers
"Despite recent market gains, younger boomers are willing to settle for lower returns, provided they can buffer themselves from the downside.... 87% of [survey] participants said they found a product with a 4% return and a guarantee that it won't lose value to be more attractive than a product that provided an 8% return plus exposure to market downside. The guaranteed option was also overwhelmingly favored by women, as 91% of them preferred the 4% guarantee compared with 82% of men." (Investment News; free registration required)

Five Years Is the New Permanent Under Obama's Proposed Estate Tax Reversal
"Obama's 2014 budget proposal ... would increase estate taxes and limit techniques used by the wealthy to transfer assets through trusts. The plan also caps at $3.4 million the amount individuals can amass in tax-preferred individual retirement accounts and requires those who inherit IRAs to take taxable distributions within five years instead of over their lifespan.... The budget plan calls for returning the estate tax in 2018 to 2009 levels, which is a reversal from the so-called fiscal-cliff budget deal Obama signed in January. That law made the estate-tax terms permanent and indexed them for inflation." (Investment News; free registration required)

Retirement Savings: The Married/Single Gap
"The median married household has $111,600 in total savings. In contrast, the median single-person household has $12,500 in savings. That's a huge difference, almost a factor of 10. At the extremes, the top 30% of married households have savings of $332,400 or more; the top 30% of single-person households, $90,000 or more. Meanwhile, the bottom 30% of married households have less than $24,000 saved; the bottom 30% of single-person households, less than $800." (Vanguard)

401(k) Mistakes: Avoid These 10 Retirement Pitfalls
"Here are the biggest pitfalls experts say can do the most damage to your [401(k)] nest egg. Not having one.... Going with the default contribution level... Withdrawing funds too soon.... Trying to play 'catch up'.... Not having a diverse portfolio.... Being too cautious when you're young.... 'Setting and forgetting' a target date fund.... Panicking after a bad quarter.... Not paying attention to fees." (TIME)

University Presidents Endorse Illinois Pension Reform Proposal
"The presidents and chancellors of the 14 public universities in Illinois have unanimously endorsed a six-point proposal for addressing the state's pension funding crisis as it relates to the State Universities Retirement System ... [They] acknowledged the additional financial burdens to be borne by the universities and their employees through the cost shift and COLA adjustment. 'The cost shift will be feasible only if phased in slowly ... and made concurrent with a stabilization of general revenue appropriations during the transition," the letter stated." (Capitol Fax.com)

Businessman Will Pay $4M to Detroit Pension Funds in Settlement Over Failed Investment
"The businessman, Donald Watkins, had claimed that some pension trustees shook him down for donations to [ex-Detroit Mayor Kwame Kilpatrick's] legal defense fund, free flights on his jet and campaign contributions, but that he refused to participate. But the pension funds -- one for the police and fire departments, another for general city workers -- claimed that Watkins did them wrong and cost them millions." (Detroit Free Press)

Update on the Proposal for a Broader 'Fiduciary' Definition (PDF)
"The DOL's pending proposal to broaden its 'investment advice fiduciary' definition is likely to 'shake up' the retirement plan industry, pressuring many retirement plan advisors to provide their services in a fiduciary capacity for a level fee. If the DOL's re-proposed rule is similar to its initial proposal, any advisor that is unwilling to advise plan clients on these terms may, as a practical matter, be forced out of the retirement plan business." (Wagner Law Group via ByAllAccounts)

Is There Momentum for Florida Law to Speed Advisor Registrations?
"The [Financial Services Institute] has been working with Florida regulators for years to streamline their review process for advisor applications, and has recently expanded its lobbying presence in the state capital to build momentum for the bill to make Florida a notice-filing state. Final passage would bring Florida in line with almost every other state's registration process." (On Wall Street)

Expected Fiduciary Rules Could Worsen Retirement Crisis, Fidelity Chief Warns
"A top executive with Fidelity on Wednesday urged congressional action to stave off what he described as 'a looming retirement crisis,' appealing to lawmakers to pressure the Department of Labor to avoid an expansive redefinition of fiduciary responsibilities for advisors, among other things.... 'We need to make significant reforms to the U.S. retirement system now, and we need to do them because there's an ever-increasing number of Americans that are marching towards retirement with very little hope of maintaining their standard of living,' he said." (Financial Planning)

SEC Gets a Boost in Funding for Fund Adviser Oversight under Obama Budget
"Under the proposal, the SEC's budget would rise to $1.67 billion, from $1.32 billion.... In its budget request document, the agency said that it examined only about 8% of 11,000 registered advisers in fiscal year 2012 and that 40% of advisers have never been examined. The SEC said that it wants to increase its examination rate to 45% to 55% annually[.]" (Investment News; free registration required)

Rates Rise and Your DB Plan Loses. Right? (PDF)
"Many defined benefit pension plan sponsors are concerned about the effects of increasing interest rates on their fixed income portfolios, and some are considering shortening the duration of those portfolios.... Rising interest rates may not trigger overall decreases in liability (or bond) values, because much depends on the time horizon over which the rate increases occur. The dynamic at play here is in the trade-off between yield curve impact and interest cost." (Russell Investments)

[Opinion]

The United States of Cyprus: Will American Retirement Accounts Be Raided?
"[I]n the United States most baby boomers are ill-prepared for retirement. To impose a limit on the accruals in a tax-deferred account (these are the accruals, mind you, not contributions, which are already limited) is simply a counter-productive solution to the real problem: People are not saving enough money for retirement." (National Center for Policy Analysis)

[Opinion]

President's Budget Is Bad News for Retirement Security
"The Administration has decided that current law allows some Americans to save too much in tax-qualified retirement plans. The budget proposes a new overall individual limit based on a current limit for just one plan. Administration of this limit will be extremely complex, causing business owners to reconsider their decision to offer a plan. When a business doesn't offer a plan, it's rank-and-file workers who suffer." (Plan Sponsor Council of America)

[Opinion]

Statement by ERIC on Administration's FY 2014 Budget Proposal to Cap Retirement Savings and Increase PBGC Premiums
"The President's FY 2014 budget proposal to limit the deduction or exclusion for contributions to defined contribution plans, defined benefit plans or IRAs for an individual with accumulated retirement savings of approximately $3 million appears to be short-sighted, confusing, and does not consider the unintended consequences of imposing such a cap.... ERIC urges the President to withdraw this ill-advised proposal and concentrate more on incentivizing individuals and families to save more for retirement, rather than penalizing those who have successfully planned for their retirement." (The ERISA Industry Committee)

[Opinion]

Obama's Budget Tees Up Retirement Program
"One of the best ways to shore up Social Security, and to address larger debt issues, is by gradually reducing rates of growth. Chained CPI does just that. Other, more noticeable options for bolstering the retirement program include raising the eligibility age and increasing Social Security taxes." (USA TODAY)

[Opinion]

Leaders Must Address Taxes, Spending Without Harming Retirement Security
"While workers defer taxes on their retirement savings today, they will pay taxes on their income in retirement. 'Capping' tax deferral at 28 percent would reduce or even reverse the powerful incentives that have helped Americans amass $10.5 trillion in defined contribution plans and IRAs -- savings to help ensure retirement security. Similarly, the proposal to place a dollar cap on individual retirement saving accounts would add complexity and confusion to our nation's system for retirement savings." (Investment Company Institute)

[Opinion]

The Pension Rate-of-Return Fantasy?
"[A]ny increase in interest rates will disproportionately lower liabilities relative to assets, which is why the Fed and the Bank of Japan are pumping massive liquidity in the system to fight deflation and raise inflation expectations. Importantly, the best possible outcome is that we get a decade of rising stock market gains and rates slowly 'normalize' back to historically normal levels of 2.5-3%. A concurrent rise in assets and interest rates will significantly help reduce or wipe out pension deficits." (Pension Pulse)

[Opinion]

403(b) Fair: Promoting Greater Transparency for 403(b) Plan Fees
"The 403(b) market has long been highly individualized and retail-focused, while the 401(k) market has been more efficient and institutionalized. The 401(k) market has known for years that pooling assets allows for a more competitively priced platform, reducing fees for participants.... [W]hen it comes to using plan assets as a bargaining tool to reduce costs to their 403(b) plans, most schools districts can't do so because the kindergarten-through-12 market does not embrace, nor is it designed to allow for, employer-level scaled pricing." (The Agbay Group)

[Opinion]

ESOP Association Disappointed with Budget Proposal to Kill Section 404(k) Deduction
"Included in the budget document is a provision to eliminate ... Section 404(k) ... [which] permits a C corporation to deduct the value of dividends paid on ESOP stock passed through to employees in cash, deductions used to pay the ESOP acquisition loan, or when the employee reinvests in more company stock in his/her ESOP account balance.... 'This is a major proposal to reduce an incentive to create and operate an ESOP; we are disappointed it has been included in the President's budget,' said ESOP Association President, J. Michael Keeling. 'It is counter-intuitive to eliminate an incentive for a policy that resulted in fewer layoffs during the Great Recession.' (The ESOP Association)

[Official Guidance]

Text of the White House's Proposed 2014 budget
"Here's President Obama's $3.77 trillion budget proposal for 2014. The plan proposes new [spending] in infrastructure and education, major new taxes for the wealthy, and reforms aimed at reducing the cost of Social Security and Medicare." (The Washington Post)

Eighth Circuit Clarifies Scope of ERISA's Application to Severance Arrangements
"[T]here was no evidence that the agreement amended an ERISA plan, and in fact, the agreement concerned post-termination payments that could only occur when Schieffer was no longer a participant in the company's plans.... Although the benefits were measured by the ERISA plans, ... [the employer] had not indicated that the funds came from anywhere other than its general assets ... [and] had not alleged that the payment would affect the administration of its ERISA plans or 'threaten ERISA's goal of uniformity in the administration of plan benefits'.... [The court concluded that the] arbitration demand did not seek benefits 'due under' an ERISA plan, and the federal court lacked subject matter jurisdiction over the dispute. " [Dakota, Minn. & E. R.R. Corp. v. Schieffer (Schieffer II), No. 12-1807, 2013 WL 1235235 (8th Cir. Mar. 28, 2013)] (Benefits Bryan Cave)

Opportunity for Possible FICA Tax Refund on Severance Pay Ends April 15
"Until a final decision in [U.S. v. Quality Stores] has been rendered, taxpayers that have made severance payments in 2009 should file a protective claim for a FICA tax refund no later than April 15, 2013. This protective claim will preserve the taxpayer's right to a refund should the IRS not appeal the decision or should the decision be upheld on appeal." (Benefits Bryan Cave)

Proskauer ERISA Litigation Newsletter, April 2013
"The importance of clear and unambiguous plan language cannot be overstated. The Second Circuit recently applied this well-established principle to conclude that a plan's administrative claims process must clearly state all of the types of claims that must be exhausted in order to prevent participants and beneficiaries from proceeding directly to court." (Proskauer Rose LLP)

DOL Releases Fiscal Year 2014 Budget Request
"Highlights of the FY 2014 budget request include: ... [1] Nearly $14 million to combat the misclassification of workers as independent contractors, which deprives workers of benefits and protections to which they are legally entitled and puts law-abiding businesses at a disadvantage against employers who violate the law. [2] An additional $3.4 million ... to support greater enforcement of ... the Family and Medical Leave Act. [3] $5 million for the creation of a State Paid Leave Fund to assist workers who need to take time off to care for a child or other family member. [4] An initiative to encourage companies to fully fund their pension benefits by authorizing the [PBGC] to adjust premiums and take into account the risks that different retirement plan sponsors pose to their retirees. Under the initiative, the PBGC is estimated to save $25 billion over the next decade." (Employee Benefits Security Administration)

Avoid Too Much Specificity in Clawback Policies
"One of our guiding principles to date has been that companies should not put too much effort into fine-tuning a clawback policy at this point, since (i) the issues are many and complicated, and (ii) the SEC and NYSE rules are certain to require a complete rewrite.... By adopting general provisions and referencing the precise terms in DF 954, the Committee (or Board) will have the ability to adjust the meaning and application of its policy as the SEC and the NYSE publish rules." (Winston & Strawn LLP)

New Consumer-Education Campaign Announced at National Retirement Planning Week Event Insured Retirement Institute (IRI)

Towers Watson Adds Robin Gantz, Annuity Purchase Expert, to Retirement Risk Management Group in U.S. Towers Watson

Vanguard Expands Availability of Low-Cost 401(k) Plan Service for Small- to Mid-Size Businesses Vanguard

ING U.S. Announces Plans to Rebrand as Voya Financial ING Retirement

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