Digest
401k Plans Are Being Retooled to Function Like a Pension Plan - Summary: The 401k plan is getting a makeover, and for the 76 million Baby Boomers just starting to wind down their careers, the change couldn't come at a better time.
Located at: Wall Street Journal Online. Click on headline for full article.
Trust: Missing Element in Retirement Plans - Summary: Employees who don't trust 401k's, 403b's, or their employer aren't likely to take full advantage of the plan, even with automatic enrollment.
Located at: Employee Benefit News (free registration may be required). Click on headline for full article.
Plan Sponsors Courting Disaster - Summary: Confusion over 401k plan fees is triggering lawsuits and congressional inquiries. What can plan sponsors do to head off trouble?
Located at: CFO.com. Click on headline for full article.
Ten Techniques for Communicating About Retirement Plans - Summary: Communicating with employees about their retirement benefits can be a challenge. Varying degrees of investment knowledge, scattered workforces, limited time and busy schedules all conspire to make getting the message across very difficult. Nevertheless, the process is getting easier.
Located at: Employee Benefit News (free registration may be required). Click on headline for full article.
Time to Convert Retirement Funds to a Roth? - Summary: If you want to convert employer plan funds directly to a Roth IRA, there are some new Internal Revenue Service rules you should be aware of.
Located at: Financial-planning.com. Click on headline for full article.
In-Service Distributions - Summary: In-service withdrawals are those taken prior to normal retirement age. This is a Q&A on some of the more common issues.
Located at: McKay Hochman. Click on headline for full article.
ERISA Lawyers Likely to Seek More Fiduciary Breach Clarification - Summary: In the months after the U.S. Supreme Court's ruling sanctioning fiduciary breach lawsuits by individual participants, lawyers are likely to turn their attention to defining the type of allowable recoverable losses and settling the issue of what are considered a participant's administrative remedies.
Located at: Plansponsor.com (free registration may be required). Click on headline for full article.
More Companies Offer Roth 401ks - Summary: After an initially cool reception, more corporations are beginning to offer employees the option of saving for their retirement in a Roth 401k plan. A large number of companies are still turned off by the relatively new retirement plan option, however, fearing that adding a Roth 401k feature to their benefits platform will only complicate matters for both employees and employer.
Located at: Financialweek.com (free registration may be required). Click on headline for full article.
Contribution Timing and Collection Responsibility, a Q&A - Summary: When must 401k deposits be made? Who's responsible when contributions are not made? The Department of Labor is flexing its regulatory and advisory muscle to clarify any misunderstanding that may exist and at the same time is asking the benefit's community to suggest alternative solutions.
Located at: 401khelpcenter.com. Click on headline for full article.
401k Loans = Retirement Insecurity - Summary: The option of borrowing against a 401k is attractive; however, potential borrowers should be wary. Even in extreme situations, it is best for workers to seek other sources of capital before tapping their 401k accounts.
Located at: National Center for Policy Analysis. Click on headline for full article.
Court and Legislative Items
Legislative Tracking Chart -- Retirement - Summary: This chart summarizes selected federal legislation that would affect employer benefit programs. The bills included on the charts are based on judgments regarding the prominence of the issue, the likelihood of enactment, and the influence of the sponsors.
Located at: Towers Perrin (PDF File). Click on headline for full article.
Wal-Mart Suit Hits 401k Fees - Summary: Lawsuit argues $9.5 billion plan used overpriced funds with under whelming returns at employees' expense. If any executives at large corporations think lawsuits over 401k fees are going somehow to quietly disappear anytime soon, think again.
Located at: Financialweek.com (free registration may be required). Click on headline for full article.
Reliant Wins 2nd Stock Drop Case Ruling - Summary: A federal judge was correct in dismissing a 401k participant's company stock suit because the plaintiff had not put on a strong enough case that a Houston energy firm had violated its fiduciary duties in handling the company stock fund, an appellate court has ruled.
Located at: Plansponsor.com (free registration may be required). Click on headline for full article.
Research
The Future Shock of Retirement - Summary: Reviewing some recent academic literature yields a surprising conclusion: At least superficially, Americans appear better prepared for retirement than previously believed.
Located at: Barclays Global Investors (PDF File). Click on headline for full article.
DOL and IRS Items
Labor to Host Web Cast on Form 5500 Reporting Requirements - Summary: The U.S. Department of Labor’s Employee Benefits Security Administration will host a free web cast May 8 to help employers and plan administrators understand and comply with the Form 5500 Series reporting requirements under the Employee Retirement Income Security Act.
Located at: U.S. Department of Labor. Click on headline for full article.
DOL Issues Technical Corrections to QDIA Regulation - Summary: The technical corrections affect three areas of the final regulation on QDIAs. These include changes clarifying the preamble example on "round-trip restrictions," expanding the scope of who can manage a QDIA to include a committee that is a named fiduciary of the plan, and correcting the "grandfather" relief for stable value funds.
Located at: U.S. Department of Labor (PDF File). Click on headline for full article.
DOL Field Assistance Bulletin No. 2008-03 - Summary: Since publication of the QDIA regulation, a number of issues have been raised concerning the scope and meaning of various provisions of the QDIA regulation. This Bulletin is intended to supplement the QDIA regulation by providing guidance, in a question and answer format, on a number of the most frequently asked questions.
Located at: U.S. Department of Labor. Click on headline for full article.
