Headlines about "Ret plan investments - self-directed"
Gathered from the web by the editors at BenefitsLink.com.
401(k) Plan Sponsors Less Confident That Employees Will Be Financially Prepared for Retirement (PDF)
"84 percent of polled executives responsible for [401(k)] plans say only some or very few employees will be financially prepared for retirement, a new Deloitte survey reveals. . . . To encourage plan participants to make better use of their 401(k), nearly half of plan sponsors (49 percent) are offering features that automatically increase participants' contribution levels. However, nearly two-thirds (64 percent) of plan sponsors report that fewer than 10 percent of participants take advantage of this opportunity." (Deloitte; International Foundation of Employee Benefit Plans; International Society of Certified Employee Benefit Specialists)
Deloitte's 2011 401(k) Benchmarking Survey (PDF)
68 pages. 'While plan sponsors and fiduciaries are generally aware of the fees charged for the administration of their plans, the possibility exists that many will be surprised by the sum total of costs." (Deloitte)
[Opinion] A Closer Look at the Braden v. Wal-Mart Case: How Not to Run a 401(k) Plan
"The Wal-Mart case is the poster child for the way in which a 401(k) plan should not be run: plan investment options bearing excessive and entirely unnecessary costs, undisclosed conflicts of interest, lack of meaningful disclosure of costs to plan participants (which was actually part of the agreement between plan fiduciaries), and, I'd argue, an apparent absence of any serious fiduciary mindset on the part of the plan sponsor fiduciary and the trustee fiduciary." (Morningstar Advisor)
[Guidance Overview] Final ERISA Section 408(b)(2) Regulations Include Significant Differences from Interim Rules
"These regulations make several significant changes . . . including: [1] Excluding certain frozen IRC Section 403(b) plans issued before January 1, 2009 from coverage under the regulations; [2] Enhancing the information relating to 'indirect compensation' required to be disclosed; [3] Adding certain investment-related disclosures to facilitate compliance with DOL regulations under ERISA Section 404(a); [4] Extending the effective date to July 1, 2012. This has the effect of delaying the effective date of most participant-level disclosures under ERISA Section 404(a) to August 30, 2012." (Practical Law Company)
New Treasury Rules Ease Purchase of Annuity With 401(k)
"J. Mark Iwry, an official at the Treasury department, said the department hoped in particular to foster a workplace market for 'longevity insurance,' something much discussed in policy circles but that employers rarely make available to workers when they retire." (New York Times; free registration required)
Treasury Eases Rules on Annuities in Retirement Plans
"Employers have been reluctant to adopt annuities in retirement plans they sponsor because of concern that fees are too high and that they would be held liable for their choice of insurers. Americans have resisted buying the insurance because they don't want to lock up their assets." (Bloomberg)
Who's on The Hook for Decisions Made in Your 401(k)?
"If you are a business owner, on the Board of Directors or serve on the Plan Investment Committee, follow the line of questions from a 'hypothetical deposition' directed to you and picture how you would answer the questions." (Forbes)
New 401(k) Policies Are a Mixed Bag
"Most workers won't see their companies offering annuities anytime soon, concedes David Wray of the Plan Sponsor Council of America, an employer group. He said employers would be concerned about choosing solid insurance companies and reasonably priced annuities for their workers." (Reuters)
The Making of The 403(b) Model Disclosure Form
"These [403(b)] plan participants are not fiduciaries, and often do not have anyone to be able to collect and compare data on their behalf. They are sold investment products directly. So it really becomes a very simple issue for that school teacher or administrator: how much sales commissions is my investment generating; what services am I getting in return; is there a way for me to compare it all; and how can I reasonably access comparative data on the investments themselves?" (Business of Benefits, Robert J. Toth Jr.)
Unraveling The Mystery of 401(k) Disclosures
"Sponsors will be required to present information about the investment options in the retirement plan in a chart that allows plan participants to compare fees and expenses . . . . Plan sponsors can use a model chart developed by the Labor Department or they can develop their own." (MarketWatch)
New Fee Disclosure Solution Released By NEA, NTSAA & ASPPA Joint 403(b) Taskforce
"Partners of the 403(b) Transparency Taskforce including the National Education Association (NEA), the National Tax Sheltered Accounts Association (NTSAA) and The American Society of Pension Professionals & Actuaries (ASPPA) today launched the 403(b) Model Disclosure Form -- the first ever transparency standards for disclosure of fees and services in the public school 403(b) marketplace." (American Society of Pension Professionals & Actuaries)
Guide to the 404a5 Opportunity for Retirement Advisors, Part I: Counseling Plan Participants
"Mark down May 31, 2012 in your calendar. That's the date by which 483,000 U.S. retirement plans must send to their participants the initial disclosures required by new Department of Labor rules under Section 404a5 of ERISA. . . . DOL estimates that the rule will affect 72 million active participants who hold $3 trillion of plan assets. . . . It is your job, and opportunity, to help them anticipate, interpret and act on information contained in 404a5 disclosures." (Benefits Pro)
Finding Trustworthy Financial Advice for Retirement and Avoiding Pitfalls (PDF)
"Many older people say they would like to have the assistance of a good advisor, but they do not know how to locate one. They can look to large institutions like Fidelity, Vanguard, or Schwab or they can utilize smaller firms or individuals who provide advisory services. Employers sometimes offer advice as part of their benefit programs. Here are some factors to help guide the search." (Society of Actuaries)
Pushback from Disclosure of Costs to Participants: Too Much 401(k) Sunshine?
"[R]ecord keepers for some plans are already experimenting with new ways to explain fees to retirement savers. And in at least one case, those disclosures are raising more questions than employers or investment advisers want to answer." (Wall Street Journal)
New Tool to Clearly Disclose 403(b) Fees
"[A]n industry task force, including the National Education Association, today will unveil a tool [called called the 403(b) Model Disclosure Form] that will clearly disclose 403(b) plan fees." (USATODAY.com)
Retirement Income in DC Plans: What Our Experience with DB Plans Tells Us (PDF)
"The potential for improvement in DC plans' ability to provide a steady stream of income has caught the eye of the financial services industry. While the marketplace races to deliver an array of possible solutions, employers and regulators are grappling with how these products fit within qualified retirement plans." (Institutional Retirement Income Council)
Mutual Funds vs. ETFs: A Comparison
"Which Is Better? It depends upon the type of investor. The traditional, less sophisticated IRA investor who reallocates strategically, rather than tactically, keeps expenses low and is not a stock picker, may find the process of purchasing shares from a mutual fund company and redeeming them a simpler process. Additionally, plan sponsors' use of mutual funds is well entrenched." (Investopedia US via Hearst Communications Inc.)
Four Retirement Plan Features Employers Need to Emphasize
"Employees are in need of simple, straightforward guidance regarding their retirement plans, a survey . . . by State Street Global Advisors found." (BenefitsPro)
[Opinion] Comments to DOL on Disclosure of Compensation Arrangements to Plan Fiduciaries by Broker-Dealers (PDF)
"[I]f broker-dealers feel the need to disclose every potential compensation arrangement for a brokerage account, plan fiduciaries will likely be overwhelmed by such information, rendering it virtually useless. . . . One possible way to eliminate this burdensome disclosure is to limit the 408b-2 compensation disclosures for brokerage accounts to the disclosures required under applicable securities laws." (Drinkle Biddle & Reath)
What Should You Do with 401(k) Funds at Retirement?
"Retirees who want to keep investments sheltered from paying current taxes will essentially have two options. Savings can be left in a company retirement plan, where retirees can keep their money in a lineup of funds chosen by the company. Or the assets can be rolled over into another tax-favored account, generally an individual retirement account, which provides investors with control over investment choices and makes it easier to work with a financial adviser." (The Wall Street Journal)
Learn to Make Market Swings Work for Your Retirement Investments
"[A new book, '401k Day Trading,']tells investors how to take control of their own future through easy-to-implement retirement strategies. 'The overlying philosophy relates to how you can use market volatility to your advantage,' . . . . 'In the past 10 years, you've been able to do 25 percent better than the market,' through this process. Put simply, '401k day trading comes down to buying low and selling high every day,' . . . ." (The NASDAQ Stock Market, Inc.)
Stable-Value Funds Are Shaky 401(k) Options
"Stable-value funds are available only in 401(k) and other types of retirement savings plans. These are non-public funds -- meaning the investor typically has a hard time researching them -- that are supposed to hold a high-quality diversified, fixed-income portfolio which protects against interest-rate volatility." (MarketWatch, Inc.)
Shielding Plan Fiduciaries from Participants' Investment Losses
"2012 is the year of a regulatory tsunami affecting plan sponsors at many different levels. As the dust settles, plan sponsors and consultants should refocus on the main issues at hand regarding defined contribution retirement plans: process and protection." (The Agbay Group)
Retirement Plan Participants Want Simple Guidance
"Retirement plan participants are in need of direct, simple guidance to help them reach their retirement goals, according to State Street Global Advisors [Defined Contribution] Investor survey." (PLANSPONSOR.COM)
Starting and Maintaining a 401(k) Made Easy
"The No. 1 thing to remember, as financial professionals remind us, is to diversify. That helps mitigate risk, which can erode investment returns." (TheStreet, Inc.)
America's Commitment to Retirement Security: Investor Attitudes and Actions (PDF)
"With millions of U.S. households personally directing their retirement savings, [ICI] has sought to track retirement savers' actions and sentiment over time. This report, our fourth annual update, summarizes results from two surveys covering 2011 data -- a survey of U.S. households and a survey of defined contribution (DC) plan recordkeepers." (Investment Company Institute)
[Guidance Overview] The DOL's Position on 'Capturing' Rollovers (PDF)
"This article examines statements made by [DOL] regarding distributions and rollovers from qualified plans to IRAs. We are advising RIA and broker-dealer clients on how to structure their rollover programs in light of this guidance, and it is important for advisers to understand the DOL's views on this significant issue." (Drinker Biddle & Reath LLP)
Financial Education Initiatives in the Workplace Survey Findings
"Approximately one-half of organizations (52%) offer financial education to their employees, [but] this percentage has decreased from 64% in 2009. These findings examine the impact that personal financial challenges have on employees as well as the types of initiatives that organizations have in place to alleviate the financial challenges faced by their employees." (Society for Human Resource Management)
6 Critical Trends for Retirement Plans in 2012
"The six megatrends Lincoln Trust sees in 2012: New 401(k) Fee Disclosure Rules by DOL . . . 'C Suite' Sticker Shock' . . . A Refined Fiduciary Standard . . . Models vs. Target-Date Funds . . . The Rise of 401(k) Evaluation Services . . . A Call for Investment Expense Transparency." (AdvisorOne)
New Fee Disclosure Rules Help Make Costs More Transparent
"The regulations for calendar-year plans take effect 60 days after April 1, 2012, so most participants won't start receiving the new information until May 31, 2012. The DOL will now require your employer and any other provider to the plan (such as the plan's financial adviser and recordkeeper) to ensure the distribution of the following information to you: . . ." (The Smarter Investor (usnews.com))
[Guidance Overview] Labor Department Offers Guidance on Electronic Disclosure But Not Much Relief
"The Release provides little relief to plan administrators who want to satisfy the disclosure requirements of the Regulation electronically but are stymied by the cumbersome requirements of the Safe Harbor as to Group 2 participants. Inexplicably, however, Method 2 in the Release is more difficult to implement than the consent procedures in the Safe Harbor for Group 2 participants." (McGuireWoods LLP)
[Opinion] Is ASPPA Really Interested in Disclosure to 403(b) Participants? Here Is Their Chance to Prove It
"While I think Single Vendor [for 403(b) programs] is the best route, I am also a realist and understand that a single vendor environment is not going to happen overnight . . . . It got me thinking about what can be done to protect current participants who are stuck in a non-oversight multi-vendor program or even a program that does have oversight but has multiple vendors. . . . I am calling on ASPPA to . . . require that those who want to work with public school employees and give 'advice' be a fiduciary and those that sell product must disclose they are NOT advice givers and NOT acting as fiduciaries." (The Meridian Blog, authored by Scott Dauenhauer CFP, MSFP, AIF)
[Guidance Overview] Finally, a Final Regulation on Providing Investment Advice (PDF)
"The final regulation, effective for transactions occurring on or after December 27, 2011, is the culmination of a five-year effort by the DOL to implement a prohibited transaction exemption to allow fiduciary investmentadvisers to render investment advice to plan participants and beneficiaries while receiving compensation from investment funds." (Trucker Huss, APC.)
[Official Guidance] FINRA Provides Guidance on Application of Communications Rules to DOL-Required Disclosures (PDF)
"To the extent that a firm provides information to plan participants that is required by and complies with the disclosure requirements set forth in the DOL rule, FINRA will treat the information as if it were a communication that satisfies the content and filing requirements of NASD Rules 2210 and 2211. Accordingly, firms are not required to file the information with FINRA pursuant to NASD Rule 2210(c), nor is the information subject to the content requirements of NASD Rule 2210(d), including the expense and performancerelated provisions of NASD Rule 2210(d)(3)." (Financial Industry Regulatory Authority)
The Case for Re-Enrollment
"When TDFs are added to a plan's investment lineup, adoption rates as a percentage of plan assets range from 1% to 5%2 (incremental to assets mapped). With re-enrollment as the strategy? TDFs jump to a 40% to 60%2 adoption rate. For sponsors interested in better asset allocation for their participants, but unsure how to drive TDF adoption in the face of participant inertia, effective implementation is key." (JPMorgan Chase & Co)
Tools for Plan Sponsors to Meet the Retirement Income Challenge
"Around age 50 -- the time they become eligible for catch-up contributions -- participants should be introduced to core income products and strategies. They'll need to prepare for critical decisions, including when to take Social Security, how much they can prudently spend from their savings, and how much they value lifetime income guarantees. The sooner participants know where to find the right resources, the better." (The Vanguard Group, Inc.)
[Guidance Overview] Plan Sponsors and Committees Can Now Help Plan Participants Allocate Their Retirement Funds
"Under the new rules, investment advice from a 'fiduciary adviser' is no longer prohibited if the advice is provided by computer modeling or a level-fee arrangement and meets several other requirements, such as sufficient auditing and disclosure. . . . The final regulations apply to transactions occurring on or after December 27, 2011." (CFO Publishing LLC)
A 401(k) Menu for Today's Investing Reality
"Globalizing your portfolio is about increasing your portfolio's exposure to non-domestic companies and alternative asset classes in order to take advantage of structural shifts, both economically and politically, taking place on a global scale, resulting in faster economic growth occurring outside the United States." (401khelpcenter.com, LLC)
The Qualified Deferred Investment Account Acts as a Fiduciary 'Get Out of Liability Free' Card
"ERISA section 404(c) and the corresponding DOL regulations define how a plan sponsor can establish protective relief as a fiduciary for investment decisions made by employees in participant-directed 401(k) plans. As introduced in the Pension Protection Act of 2006 and effective Dec. 24, 2007, plan sponsors have the option to designate a default fund, qualifying as a QDIA. If the plan complies with the requirements of the regulation, the fiduciary will not be liable for losses that result from investments in the QDIA (your fiduciary 'get out of liability free' card)." (BusinessWest)
Collective Investment Trusts: An Investment Vehicle for 401(k) Plans?
"With the new [fee] transparency, some plan sponsors will probably start looking for lower-cost investment options, and CITs may fit the bill." (U.S. News & World Report LP)
Secrets of the 401(k) Millionaires
"'The one characteristic that differentiates the winners from the non-winners here is contribution rate -- a high percentage of those million-dollar savers had constant participation and high contribution rates.'" (The Wall Street Journal)
Investors Express Optimism for Retirement Plan Investing
"Many of those surveyed feel better about investing in retirement vehicles, like 401(k)s and IRAs. Nearly three-fourths of investors said they believe now is a good or very good time to be investing in retirement products such as 401(k) plans and IRAs (73% each). Both of these figures represent meaningful increases over last quarter's lows (66% for 401(k)s and 67% for IRAs)." (PLANSPONSOR.COM)
Fidelity Analysis Highlights Positive Impact of PPA on 401(k) Plans
"The study found that more than half (51%) of Fidelity's 401(k) participants are now in a plan that offers auto enrollment, up from just 16% five years ago, having a dramatic impact on participation rates. Additionally, the percentage of plans defaulting participants into age-based lifecycle funds has increased from 11% to 73%." (Wolters Kluwer Law & Business / CCH)
Recovering from the Market Downturn of 2008 (PDF)
"We first assess how declines in typical portfolio values impacted overall projected retirement incomes, factoring in Social Security, future growth and future savings. We then find that even for investors within five years of retirement, modest increases in savings combined with slightly delayed retirement can recover their pre-2008 retirement outlooks if they stay in diversified age-appropriate portfolios." (Society of Actuaries)
Target-Date Funds End Another Year Far Away from Bull's-Eye
"[T]he average fund with about four years until its target date fell 0.4% in 2011, according to Morningstar Inc., a fund-research firm. That trails the Standard & Poor's 500-stock index, which gained 2%, including dividends, and is well below the Barclays Capital Aggregate Bond Index, which rose nearly 8% for the year." (The Wall Street Journal)
[Guidance Overview] New DOL Regs Offer More Investment Advisers the Opportunity to Provide Advice to Participants in 401(k) Plans and IRAs
"The relief provided under the New Regulations will not apply to any transaction for which the conditions under the New Regulations were not satisfied. Further, if a fiduciary adviser has engaged in a pattern or practice of noncompliance with any of the applicable conditions of the New Regulations, the prohibited transaction relief will not apply to any transaction connected with the provision of investment advice during the period of such noncompliance." (Kilpatrick Townsend & Stockton LLP)
Teachers' 403(b) Plans Becoming More Like Corporate 401(k) Plans
"Much of the current change is being driven by Internal Revenue Service rules that began taking effect in 2009 and that give plan sponsors administrative and compliance responsibilities for employees' 403(b) investments. Change also is coming as growing numbers of teachers face cuts to their traditional pensions, giving them more incentive to sock away money in 403(b)s, consultants and school officials say." (The Wall Street Journal)
Understanding the Three Main Pillars That Create the Foundation for Retirement in the U.S.
"The Three Pillars: In our opinion, those pillars consist of Medicare, Social Security and Retirement Plans. Each of these pillars is complex in its own right." (Seeking Alpha)
Reasons To Boost Your 401(k) Contributions
"[T]he prospect of higher taxes and the fact that more traditional retirement savings vehicles are going away completely or [are] about to experience severe stress given the coming rapid rise in retirees, the 401(k) could end up making or breaking your retirement. The prospect for higher market returns going forward is another key consideration." (Investopedia US via Hearst Communications Inc.)
401(k) Plans, a Volatile Stock Market and Generation Y Participants
"Gen Y never had a chance to learn about investing before its members were jolted by a near 40% market drop in 2008. This drop frightened even the most seasoned investors, but it shook Gen Y investors to the core; 52% of them liquidated a portion of their portfolio in 2010 or 2011 due to market concerns.' (Microsoft)
End of the Year 401(k) Options
"It's time to evaluate the performance of your 401(k) plan over the past year. If your plan has grown, or at least done well relative to the markets at large, then you may not need to make any major changes to your investment portfolio." (Investopedia US via Hearst Communications Inc.)
[Opinion] Three 401(k) Reforms that Can Help Save America's Retirement
"Uncle Sam currently offers a solid incentive for business owners with less than 100 employees to start a 401(k) plan. However, to create a splash in awareness and encourage more small businesses to move forward with a 401(k), the federal government can do more." (Forbes.com LLC)
On the Final Rule Implementing Class Exemption for Investment Advice to Participants/Beneficiaries of 401(k) Plans and IRAs
"Under the statute, there are two approaches that may qualify as an 'eligible investment advice arrangement': the so-called 'level fees' alternative, and one that utilizes a computer model to present investment alternatives." (PLANSPONSOR.COM)
Three Pitfalls To Avoid When Retirement Planning
"For those who would like to plan ahead, there are multiple ways to help set yourself up for a secure retirement later. There are also traps that many fall into: Here are three of them to avoid." (Seeking Alpha)
Saving for Retirement Used to Be Simple; Now It's Rife with Contingencies
"The problem is that there's no safe-yet-lucrative way to save anymore. The broad stock market has had several epic rallies and nosedives in the past decade, and many experts say that wild swings are here to stay. All the while, inflation will inevitably eat away at the value of people's savings. What's more, the safe, fixed-income investments -- from bank CDs to government bonds -- are paying next to nothing these days." (National Journal Group Inc.)
Preliminary Settlement Reached in High-Profile 401(k) Fee Lawsuit
"Fiduciaries would have to remove retail funds from a 401(k) plan's investment lineup, under a proposed settlement of the Braden v. Wal-Mart excessive fee litigation. As preliminarily approved Dec. 5 by a federal court in Missouri, the settlement also calls for a $13.5 million cash payment . . . This lawsuit contrasts with other recent appellate cases where fiduciaries prevailed on excessive fee claims involving retail funds." (Mercer Select)
More Sponsors See Benefits in Investment Tiering
"Sponsors can tier their DC plan lineups in many ways. One common approach divides a plan into two tiers -- one devoted to a lineup of index-oriented TDFs; the other dedicated to broad-based index funds (i.e., the index tier). (Vanguard)
[Guidance Overview] Department of Labor Releases Revised Interim Policy on use of Electronic Media for Certain Disclosures in Participant-Directed Individual Account Plans (PDF)
Extensive summary; includes very useful chart of compliance options. (Transamerica Center for Retirement Studies)
Financial Engines Offers New Advice Program for Pre-Retirees: Annuitization
"[T]he general model it starts from is as follows: You live on the income from your portfolio through age 85, and using another portion of your savings, you can buy an immediate annuity at any point up to age 85 that will allow you to collect that same level of income for the rest of your life." (New York Times; free registration required)
Brightscope's List of the Best 401(k) Plans for 2011
"BrightScope found that companies -- at least the giant ones that made the list -- were significantly more generous with their employees than last year. The average company provided an average of $11,000 per plan participant in 2011, up from $8,000 last year." (New York Times; free registration required)
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