Digest
Portability Chart as of 2008 - Summary: What are the rollover rules after the Pension Protection Act (PPA) of 2008? Here is a chart that answers the question.
Located at: McKay Hochman. Click on headline for full article.
To Roth or not to Roth 401k - Summary: Money Magazine's Walter Updegrave explains the pros and cons of a Roth 401k vs. a regular 401k.
Located at: Money Magazine. Click on headline for full article.
Is DC Plan Communication and Education Dead? - Summary: Now that plans can be automated to a large degree, do communication and education have roles to play? They do indeed. Getting workers into a 401k plan, increasing their savings rate, and improving their diversification through default mechanisms is not necessarily synonymous with financial security.
Located at: Workforce Management (free registration may be required). Click on headline for full article.
Influences on Workers' Asset Allocations in Defined Contribution Accounts - Summary: The way that assets are allocated – either by the plan participant or through the investment strategy established by the sponsor – is an essential determinant of the success of workers covered by DC plans in accumulating the financial resources necessary for retirement.
Located at: Watson Wyatt Worldwide. Click on headline for full article.
Retirement Challenges Differ for Women - Summary: Planning is particularly vital for women because of the special challenges they face. For example: Women live longer than men – an average of seven years – so their retirement funds have to last longer.
Located at: Fort Wayne Journal Gazette. Click on headline for full article.
DB to DC Switch Lowered Retiree Replacement Income - Summary: New research from the Center for Retirement Research at Boston College (CRR) suggests the change in the retirement landscape from predominately defined benefit plans to mostly defined contribution plan coverage has decreased both household pension wealth and retiree income replacement rates.
Located at: Plansponsor.com (free registration may be required). Click on headline for full article.
Spouse Beneficiary Rules - Summary: Under the original and final required minimum distribution regulations, the surviving spouse has always had special opportunities. The surviving spouse of a deceased participant may roll the funds into his or her own IRA or to a qualified plan, if the qualified plan accepts rollovers.
Located at: McKay Hochman. Click on headline for full article.
Litigation and Court Items
GM Settles 401k Suit for $39 million, Report Says - Summary: General Motors has agreed to pay about $39 million to settle a class-action lawsuit brought by employees and retirees for claims involving company pension and retirement funds, according to people familiar with the deal, The Detroit News reported.
Located at: Marketwatch.com. Click on headline for full article.
Pre-Nup Pact Not an ERISA Benefits Waiver - Summary: Because a 401k participant's widow had not yet married her husband when she signed a prenuptial agreement giving up her rights to her husband's retirement benefits, the widow was still entitled to the money.
Located at: Plansponsor.com (free registration may be required). Click on headline for full article.
Legal Briefing on LaRue - Summary: The Supreme Court's consideration in LaRue v. DeWolff last fall may send shivers down the spines of retirement plan sponsors from coast to coast. At issue, according to legal experts, is whether an individual can sue to recover investment losses resulting from an administrative mistake and whether plans would have to pay real money to correct such mistakes.
Located at: Employee Benefit News (free registration may be required). Click on headline for full article.
Employer Ordered to Pay for Failing to Monitor Providers - Summary: The owner and operator of a Salem, New Hampshire, business has been ordered to pay $100,000 to the company’s profit sharing plan over alleged violations of the ERISA.
Located at: Plansponsor.com (free registration may be required). Click on headline for full article.
Automatic Enrollment Items
Automatic 401k Plans Might Not Save Enough - Summary: Automatic 401k plan enrollment, advocated by lawmakers, regulators and financial-services firms, isn't helping many workers save adequately for retirement, according to recent research.
Located at: Wallstreet Journal Online. Click on headline for full article.
Automatic 401k Plans Capture Attention of Small, Midsize Employers - Summary: Automatic 401k plans continue to grow in the workplace, leading some small and midsize employers to consider adding automatic features - but not for the reasons some might think.
Located at: Employee Benefit News (free registration may be required). Click on headline for full article.
Measuring the Effectiveness of Automatic Enrollment - Summary: An analysis of about 50 plans adopting automatic enrollment confirms that the feature does improve participation rates, particularly among low-income and younger employees.
Located at: Vanguard Center for Retirement Research (PDF File). Click on headline for full article.
DOL and IRS Items
IRS Proposes Regulations Regarding Automatic Contribution Arrangements - Summary: The two automatic contribution arrangements that the proposed regulations cover are "qualified automatic contribution arrangements" ("QACAs") and "eligible automatic contribution arrangements" ("EACAs"). This article focuses on the main issues addressed by the proposed regulations as they relate to QACAs and EACAs.
Located at: Trucker Huss. Click on headline for full article.
DOL Cracking down on 401k Oversight - Summary: The Department of Labor is has proposed levying fines of up to $1,000 a day against retirement plan administrators who fail to disclose certain documents to investors.
Located at: Wolters Kluwer Financial. Click on headline for full article.
