Digest
Plan Rollover Chart - Summary: This is a chart of what the Internal Revenue Service regards as permissible when rolling funds over from one type of retirement account to another.
Located at: 401khelpcenter.com (PDF File). Click on headline for full article.
401k Automatic Enrollment -- What You Need to Know - Summary: The automatic enrollment feature is growing rapidly in popularity. Here is what you need to know and action steps to implement automatic enrollment.
Located at: TRI-AD (PDF File). Click on headline for full article.
Thieves Steal Computers With 401k Participants Data - Summary: Global investment management firm T. Rowe Price has admitted to thieves stealing two computers containing the sensitive information of thousands of 401k participants from the St. Louis office of a third-party contractor.
Located at: SC Magazine. Click on headline for full article.
Back-to-Basics: Average Deferral Percentage Test - Summary: Congress has devised several nondiscrimination tests in order to prevent qualified retirement plans from overly favoring highly compensated employees (HCEs). One of the tests is the Average Deferral Percentage test. This article covers the basics of the ADP test.
Located at: McKay Hochman. Click on headline for full article.
Default Funds, Which One is Better? - Summary: Target-date and balanced funds have become the main default options in corporate retirement plans. But which one is better? To get a feel for the answer, the author evaluated the historical performance of each using data from the past 48 years.
Located at: Financial-Planning.com. Click on headline for full article.
The Role of IRAs in U.S. Households' Saving for Retirement - Summary: With $4.6 trillion in assets in mid-2007, individual retirement accounts (IRAs) represent more than one-quarter of U.S. total retirement market assets, compared with 14 percent two decades ago. IRAs have also risen in importance on households' balance sheet.
Located at: Investment Company Institute (PDF File). Click on headline for full article.
Research
401k Plan Eligibility Survey - Summary: This is the tenth year that PSCA has collected defined contribution plan eligibility data. The changes over time have been significant.
Located at: Profit Sharing/401k Council of America (PDF File). Click on headline for full article.
Retirement Plan Participation: Age Differences - Summary: How does the level of participation in a retirement plan vary with age? How does the level of participation vary between workers in the private sector and those in the public sector?
Located at: Employee Benefit Research Institute (PDF File). Click on headline for full article.
Small Business Owners' Concerned About Retirement - Summary: Nearly half of small business owners are concerned they will not have enough money to retire (43 percent) and many say they are worried about not being able to pay for medical costs of a serious illness or accident (47 percent) according to the latest Wells Fargo/Gallup Small Business Index survey.
Located at: 401khelpcenter.com. Click on headline for full article.
Annuities in 401k Plans Increasingly Accepted - Summary: Annuities in defined contribution plans are gaining momentum as aging baby boomers seek to create guaranteed retirement income streams, according to a report from the Financial Research Corporation.
Located at: Planadviser.com. Click on headline for full article.
Commentary
Replicating Australia's Retirement System Could Fill America's Empty Nest Eggs - Summary: "Mention the word Australia and the images that come to mind are "shrimp on the barbie," Koala bears and kangaroos. We'd like to add another image: Baby boomers who can actually afford to retire."
Located at: Employee Benefit News. Click on headline for full article.
Consider the Benefits of a Roth 401k - Summary: The Roth 401k is particularly attractive to higher-earnings individuals, or those that would mostly likely be phased out of IRA contributions.
Located at: Financial Planning Blog. Click on headline for full article.
DOL and IRS Items
DOL Proposes Regulation and Class Exemption for Fee Disclosure - Summary: The U.S. Department of Labor has released proposed regulations that require certain service providers to disclose information about fees and compensation – both direct and indirect – to plan fiduciaries.
Located at: Watson Wyatt Worldwide. Click on headline for full article.
Field Assistance Bulletin 2008-01 - Summary: Deals with fiduciary responsibility for collection of delinquent contributions and the question, "What are the responsibilities of named fiduciaries and trustees of ERISA-covered plans for the collection of delinquent employer and employee contributions?"
Located at: U.S. Department of Labor. Click on headline for full article.
Upcoming Audio Conferences
McKay Hochman: Overview of Types of Plans, Documents & Guidance
Start here to build the foundation of information necessary to understand qualified retirement plans. McKay Hochman covers all the basics in this first module of the year, including the need for retirement income, a chart of every retirement plan available in the U.S., the Internal Revenue Code, and much more. February 27, 2008. For more information, click here.
McKay Hochman: Eligibility and Participation
This audio conference will provide you with all the basics, starting with the statutory ERISA requirements and how to apply them. Conference will address different methods of determining eligibility such as Elapsed Time or Hour of Service. We'll also clarify, with examples, the eligibility rules for rehires – typically the most challenging of the eligibility rules, and an example of the coverage ratio test. March 19, 2008. For more information, click here.
McKay Hochman: Vesting, DC Contributions, Allocations
Vesting is a non-forfeitable right to an employer contribution and you'll benefit knowing the ins and outs of how it works. You'll come away from having attended this module knowing the vesting basics including benefits, schedules, service requirements, break-in-service rules and more. Examples of employer and employee contributions to a plan will be used to give a full picture of what is out there. March 26, 2008. For more information, click here.
McKay Hochman: Top Heavy Rules, Keys, Attribution, HCEs
This audio conference will address a number of concepts, beginning with the definition of HCEs and the family attribution rules and ending with an in-depth overview of the top heavy rules. Conference will also discuss that the IRS does not permit a plan to discriminate in favor of the HCEs – but it doesn’t stop there. April 2, 2008. For more information, click here.
McKay Hochman: Controlled Groups, 415 Limits, Deductions
When completing an adoption agreement, it is important to know if the employer is part of a controlled group. Join us to learn the basics of control groups. When dealing with qualified plans, you’ll also need to know the annual limitations for participants, the employer deduction rules and the ERISA protection from creditor rules. April 9, 2008. For more information, click here.
McKay Hochman: Plan Reporting and Disclosure
This audio conference will focus on plan reporting and disclosure. After this session, you will be familiar with key points to know about Form 5500 and you will understand the scope and significance of ERISA-required disclosures to participants and beneficiaries. April 16, 2008. For more information, click here.
