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Voluntary Fiduciary Correction Program
June 20, 2018 WEBCAST
Employee Benefits Security Administration [EBSA], U.S. Department of Labor

Lost Participants: Modern Tools for an Age-Old Problem [2018]
July 16, 2018 WEBCAST
FIS Relius Education

Ethics: Doing the Right Thing in Difficult Situations [2018]
July 23, 2018 WEBCAST
FIS Relius Education

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Interesting Angles on the DOL's Fiduciary Rule, Part 93

"In its Regulatory Notice, FINRA points to a number of factors to be considered [by a broken recommending a rollover distribution], including the investments, services, and fees and expenses in the plan. A broker-dealer will need to gather information in order to evaluate those factors . . . and then compare them to the services, expenses, and investments in the proposed rollover IRA. That analysis must be done in light of the financial needs, circumstances and preferences of the participant." FredReish.com

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Social Security Combined Trust Fund Reserves Depletion Year Remains 2034

"In the 2018 Annual Report to Congress , the Trustees announced: [1] The OASI Trust Fund is projected to become depleted in late 2034, as compared to last year's estimate of early 2035, with 77 percent of benefits payable at that time. [2] The DI Trust Fund will become depleted in 2032, extended from last year's estimate of 2028, with 96 percent of benefits still payable.... [3] The asset reserves of the combined OASDI Trust Funds increased by $44 billion in 2017 to a total of $2.89 trillion. [4] The total annual cost of the program is projected to exceed total annual income in 2018 for the first time since 1982, and remain higher throughout the 75-year projection period."
U.S. Social Security Administration [SSA]

Accurately Evaluating the 'Retirement Crisis' (PDF)

"Examining households headed by individuals ages 35-64 that are seeking to cover 100 percent of the deterministic average costs for retirees in their age-, income-, and family-status cohorts, the [EBRI Retirement Security Projection Model (RPSM)] finds that 57.4 percent are simulated to not run short of money in retirement. In other words, just over half of U.S. households are on track for 'retirement success' by this measure." Employee Benefit Research Institute [EBRI]

Do We Really Have a Retirement Crisis in America?

"There are certainly people who ended up working longer than they originally intended or scaled back their retirement expectations for various reasons. But by and large, Americans seem to find a way to make do ... [M]edian household spending actually dropped by as much as 12.5% in the first four years of retirement, and by the sixth year a majority of households were spending less than 80% of what they spent during their working years." Financial Finesse

How Millennials Can Buy Retirement Income

"Blueprint Income, a New York City startup that launched nationwide this year ... is offering the 'personal pension' -- a monthly paycheck in retirement, accessed by purchasing income annuities in small pieces over the decades before.... About 30% of Blueprint Income's customers are in their late 20s or early 30s. That's a break from the traditional annuity market, where most purchasers are 50 or older." The Coalfield Progress

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Tax Reform Makes Now a Good Time for a 401(k) Plan Compensation Definition Audit

"Improper treatment of various elements is a common operational error of 401(k) plan administration, and a common focus of both [IRS] and [DOL] audit programs. If the plan documents and payroll system do not match, it can be a time-consuming and expensive error to correct. But in the wake of major tax reform legislation, a compensation self-audit can be vital to avoiding costly administrative errors and corrections." Kilpatrick Townsend

Bank of America Wins 401(k) Asset Transfer Appeal

"A federal district court didn't err in using the bank's approach to determine whether it profited from the transfers and then conclude that since it didn't, the workers weren't entitled to any monetary recovery, according to ... the U.S. Court of Appeals for the Fourth Circuit. The ruling is the latest installment in a 13-year court saga involving the workers and the bank that has gone three times to the appeals court." [ Pender v. Bank of America , No. 17-1485 (4th Cir. June 5, 2018)]
Bloomberg BNA

Ninth Circuit Holds That Constructive Notice Is Sufficient to Impose Withdrawal Liability on Successor Employer Under MPPAA

"The Ninth Circuit held that Amstar was on constructive notice of Ohana's withdrawal liability ... [and] identified three relevant facts to support this holding: [1] Amstar previously operated a hotel that participated in a multiemployer pension plan, and, in earlier acquisitions involving multiemployer pension plans, Amstar had sought to determine whether it could incur withdrawal liability. [2] The purchase and sale agreement stated that the employees at Ohana were unionized and that Ohana had contributed to a multiemployer pension plan. [3] The Plan's annual funding notices, indicating that the Plan was underfunded, were publicly available on the internet." [ Heavenly Hana LLC v. Hotel Union & Hotel Industry of Hawaii Pension Plan , No. 16-15481 (9th Cir. June 1, 2018)]
Thomson Reuters Practical Law

Kentucky Pension Exclusion 2018

"The State of Kentucky passed a comprehensive tax reform package in April that creates a 5% single rate individual income tax.... Kentucky workers, who will have less than $31,110 in annual income from qualifying retirement plans, can totally eliminate the Kentucky income tax of 5% on both the money they contribute to these plans and the future investment gains on those dollars." Retirement Management Services, LLC

Oregon Stops Public Employee Retirement Investment Choices

"The Oregon Treasury is calling off -- for now -- an effort to give public employees a choice in how a portion of their retirement savings is invested. The Oregonian/OregonLive reports the decision came after the agency determined that the legislation prompting the move could leave investment managers open to lawsuits if things don't go well." The Columbian

Vanguard Will No Longer Offer Its Signature S&P 500 Index Fund in Its Own Employees' Retirement Fund

"At Vanguard, which popularized the S&P 500 index funds, workers will no longer be able to choose that option in their 401(k) retirement plan.... Vanguard painted the slimming down of its fund choices as a better option for employees. Money now in the funds that are being dropped will be transferred into Target Date Retirement mutual funds based on the employee's age, starting June 25." Philadelphia Inquirer

No, Illinois Hasn't Solved Its Pension Crisis

"[T]he pre-retirement lump sum buyout takes advantage of financially vulnerable people.... [T]he COLA buyout is an invitation to anti-selection.... [It] is not yet clear to what extent the calculation of the savings from these buyouts were the result of genuine actuarial analysis versus a back-of-the-envelope calculation.... [T]he projected savings is a drop in the bucket compared to the overall $130 billion shortfall." Elizabeth Bauer, in Forbes

Big Data and the Role of the Actuary (PDF)

64 pages. "[S]ignificant advances have been made in recent years in the use of Big Data in health and life insurance. Similar advances in the pension area have not been as noticeable. However, it can be expected that over the next decade, all areas of actuarial practice will be significantly impacted by the use of Big Data." American Academy of Actuaries

11(g) Amendment for Retroactive Amendment to Remove Last-Day Employment Requirement?

Client has a calendar year SH NE 401(k) plan. PS allocation conditions are 1,000 hours and last day. The client wants to amend the plan retroactively to 1/1/17 to remove the last day requirement since operationally that is what happened. Can we use an 11(g) amendment to accomplish this? If not, is there any other way to accomplish this? BenefitsLink Message Boards

Two In-Service Withdrawals Per Year: Reduce to Only One?

I know that in-service withdrawals are a protected benefit, but what about limitations on such withdrawals? For example, a participant is allowed only 2 withdrawals per Plan Year. Would this also be considered a protected benefit? Or would this be an administrative election? BenefitsLink Message Boards

Account Balance Is Less Than Cost of Processing a Distribution: Forfeitable?

We have a partial plan termination of a pooled profit sharing plan where 13 of the participants have less than $200. For 8 of the 13 people, there isn't even enough money to pay the processor's $35 fee. Can these little balances simply be forfeited? BenefitsLink Message Boards

Which Actuarial/Mortality Table to Use for Cross Testing

I have always used the UP-84 mortality table when doing cross testing on a New Comp Plan. My plan is failing the average benefits test slightly (69.89%). The administration system I use includes a table called 2017 417(e)(3). If I use that table, the Average Benefits test passes (70.20%). The plan document doesn't say which table to use. OK to use the 2017 417(e)(3) table? BenefitsLink Message Boards

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Press Releases

NTSA announces update to 'The Source: 403(b) and 457(b) Plan' National Tax-Deferred Savings Association [NTSA]

Strategic Benefit Services Adds New Leadership to Retirement and Employee Benefits Portfolios Strategic Benefit Services

Alliance Benefit Group Aligns with Russell Investments' ARA Program Russell Investments

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