Most of us are kept pretty busy just keeping up with the day-to-day demands of retirement plan administration: getting people into the plan, helping them make respectable investment decisions, and trying to keep an eye on fees, while also making sure that all the nondiscrimination tests are adhered to properly. We all know that, sooner or later, those programs are expected to produce and/or provide retirement income, and there is a growing sense that the best way to help participants make good retirement-income decisions is to bring those decisions into the workplace retirement-planning process.
That said, if there is so much need for retirement-income products in defined contribution (DC) plans, why do so few employers and employees want anything to do with them? That’s the question that opens this month’s cover story—and one that was at least on the table at a two-day hearing held by the Treasury Department and Department of Labor last month. Now, plan sponsors that have contemplated the issues attendant with today’s retirement-income offerings in relation to ERISA plans probably wouldn’t have been much surprised by the discussion, or the concerns expressed at those hearings. However, as you will find inside this month’s issue, there are still plan sponsors, product providers, and, yes, regulators who don’t seem to appreciate fully just how treacherous those waters seem to those still standing on the shore.
Speaking of retirement income, this month’s issue also has our annual Retirement Income Buyer’s Guide, while Know How offers participants insights on ways not to spend that retirement distribution.
Of course, this is the time of year when it seems that every plan sponsor in America that is going to make a provider change is gearing up to make that change. Now, in a simpler time for retirement plans, say, 15 years ago, a major overhaul to an unsatisfying DC plan investment lineup went something like this: Find a more-skilled mutual fund provider, shut down participant access to the program for a month, ask the legacy fund manager to cash out all the participant accounts, and map the participant balances into the new manager’s funds. Today, it is much more complicated. Find out how your transition could be better managed in “‘Moving’ Parts.”
We’ve also seen massive changes in the world economy, and investing has become more global and seamless over the last 20 years. Now that world-beating companies have sprung up in Finland, Taiwan, and South Korea, it is only logical that investors also have crossed borders and become less parochial in their stock picking—and that has given rise to a new approach to investing. Find out about these global-equity strategies in “The World as an Oyster.”
One thing that hasn’t changed: the quality of our regular columnists. This month, Mike Barry takes on Social Security and what he sees as an inevitable increase in the normal retirement age, while Steve Saxon says it’s time for an electronic information revolution, and Fred Reish suggests that too safe could be too bad—for fiduciaries. All this, and much, much more! Enjoy!
DO YOU KNOW THE PLAN SPONSOR OF THE YEAR?
Each year, the editors of PLANSPONSOR magazine, the industry’s leading resource for pension- and benefits-related news, choose a plan sponsor that demonstrates leadership in providing a more-secure retirement for workers. As we have the past several years, we’re asking for your help in identifying qualified candidates for the award.
Nominations may be made by providers, advisers, consultants, actuaries, attorneys, third-party administrators, employees, or colleagues. All we need from you is contact information, and why you think they are deserving of the award—and we’ll take it from there.
More information and a link to the nomination form are at http://www.plansponsor.com/Who_Are_The_Nation’s_Best_Plan_Sponsors.aspx