Digest
Employers Redouble Efforts to Communicate Need for Diversification - Summary: The value of diversification can't be overstated for employees. That's why more and more employers and their advisers are redoubling their education and communication efforts around this crucial concept.
Located at: Employee Benefit News (free registration may be required). Click on headline for full article.
Tools to Increase Participation and Savings in DC Plans - Summary: Learn the most common barriers to good retirement plan action and effective solutions that can help increase participant enrollment and savings rates.
Located at: MassMutual's Center for Behavioral Research (free registration may be required) (PDF File). Click on headline for full article.
Survey Spots Authentic Trends Among the Buzz - Summary: After surveying nearly ninety large plan sponsors who oversee more than $120 billion in assets and over two million participants, Callan's Defined Contribution Consulting group identified authentic trends about the use of target date funds, the popularity of automatic enrollment, the appeal of guaranteed income for life solutions, plan fees and more.
Located at: 401khelpcenter.com. Click on headline for full article.
Employers Enhancing 401ks to Compensate for Retirement Plan Changes - Summary: Many companies that shift from traditional defined benefit (DB) pension plans to defined contribution (DC) plans, such as 401ks, are enhancing contributions to their DC plans, according to a recent survey by Watson Wyatt Worldwide.
Located at: 401khelpcenter.com. Click on headline for full article.
401ks Tapped to Save Homes - Summary: Struggling to save their homes from foreclosure, more Americans are raiding their 401k retirement accounts to pay their bills — and getting slammed with taxes and penalties in the process, according to retirement plan administrators.
Located at: USA Today. Click on headline for full article.
ATM Cards for 401ks Stir Controversy - Summary: At a time when mortgage defaults are at an all-time high, a New York company is marketing a debit card that allows users to withdraw money from their company 401k savings -- a plan one financial expert called "a disaster waiting to happen."
Located at: Adage.com. Click on headline for full article.
Workers Step Up Raids on 401ks - Summary: More Americans are tapping their retirement plans as the credit crunch and falling home values make cash harder to come by. But such a loan is usually a bad idea.
Located at: Moneycentral.msn.com. Click on headline for full article.
The 401k Effect: Employees Who Won't Retire - Summary: Poor performing, unpredictable DC plans keep employees hanging on, bedeviling bosses' attempts to reshape their workforce's.
Located at: Financial Week. Click on headline for full article.
Court and Legislative Items
IRS Agents Reprimanded - Summary: Practitioners have been grumbling for some time about the often quirky way in which the Internal Revenue Service administers its determination letter program, but it's not often that the Service gets called to the carpet by a federal district court judge for "extortionary, deplorable, and wrong" behavior.
Located at: Benefits Biz Blog. Click on headline for full article.
House Committee Set to Act on PPA Technical Corrections - Summary: The House Ways and Means Committee is scheduled to report out the Pension Protection Technical Corrections Act (H.R.3361).
Located at: Benefits Biz Blog. Click on headline for full article.
Automatic Enrollment
Automation: Three Steps to a High Performance Plan - Summary: This white paper offers some suggestions and best practices to consider when adopting plan automation. With a little forethought and planning, you can design and implement an effective, efficient, and appreciated automated plan.
Located at: MassMutual's Center for Behavioral Research (free registration may be required) (PDF File). Click on headline for full article.
Experts Say Automatic Enrollment Not Enough - Summary: Automatic enrollment in 401k plans makes saving for retirement a breeze by automatically diverting a small portion of new employees' salaries to the plan. But if you think by placing your retirement planning in the hands of your employer will prepare you for your golden years, experts said you'll probably come up short.
Located at: FOXbusiness.com. Click on headline for full article.
Fiduciary Items
Liability of Plan Fiduciaries under ERISA: LaRue v. DeWolff - Summary: At issue in the LaRue case was whether an individual could bring an action under ERISA to recover the losses. The Supreme Court held that a plan participant in a 401k plan could sue a plan fiduciary under Section 502(a)(2) of ERISA to recover losses caused by a fiduciary breach that only affected his individual account. This report discusses breach of fiduciary duty claims under ERISA Section 502(a)(2) and the LaRue case.
Located at: Open CRS. Click on headline for full article.
Is It Time to Re-examine What It Means to Fulfill Your 401k Fiduciary Responsibility? - Summary: Fiduciaries are now forced to ask themselves whether or not it is prudent to ignore research findings that, if applied wisely, could increase the likelihood that their employees will achieve financially secure retirements. Perhaps even more important than their conclusion may be the fiduciaries' abilities to document the process they used in arriving at their decision.
Located at: Investment Horizons (PDF File). Click on headline for full article.
DOL and IRS Items
IRS Details Simplified Determination Letter Application Process - Summary: The Internal Revenue Service (IRS) has issued Announcement 2008-23, which lays out a new simplified process for obtaining determination letters for pre-approved defined contribution plans.
Located at: Planadviser.com. Click on headline for full article.
Deferral Deposit Deadline - Summary: The long-awaited guidance on deadline for depositing elective deferrals arrived in proposed regulation format on February 29, 2008. The proposal offers a "7-business day safe harbor" for employers with less than 100 participants as of the first day of the plan year to make their deposits to the plan, not to allocate them.
Located at: McKay Hochman. Click on headline for full article.
Proposed Regs Provide 7-day Safe Harbor for Contributions - Summary: The Employee Benefits Security Administration has issued proposed regulations, applicable primarily to defined contribution plans with fewer than 100 participants, that would provide a seven-business-day safe harbor period for employers to remit contributions from participants into retirement plans.
Located at: CCH. Click on headline for full article.
