Why Plan Sponsors Fail
Our industry has long bemoaned the apparent “ineptitudes” of participant behaviors regarding their retirement savings accounts. They don’t always choose to save, even when provided with an assortment of enticements and incentives to do so and, even once they are coaxed into these programs, they tend not to make any changes whatsoever—certainly not the changes we experts would recommend. In fact, a whole area of study—behavioral finance—has turned its focus on a new generation of “auto” plan designs specifically designed to counter these all-too-human tendencies.
Having recently had a couple of new members join our 401(k) investment committee, I asked our investment adviser to conduct a briefing so that the new members—and those already serving on the committee—would have a better understanding of the responsibilities of being on that committee.
Articles that appeared in the UpFront section of the magazine.
We all have them: Those front-line experiences that are inevitable when one deals with the variety—and sensitivity—of issues associated with human beings and critical life events. Sometimes those stories are tragic, sometimes they are bizarre, and sometimes—admit it—they are just plain funny.
In late September, President Obama signed into law the Small Business Jobs and Credit Act of 2010—legislation that allows participants to convert their 401(k) or 403(b) balances to Roth 401(k) or 403(b) accounts (also 457 plans, effective January 1). Now, in order for that to “matter,” the plan has to allow for Roth accounts, and the participant has to be eligible for a withdrawal (a withdrawal that, of course, the plan has to permit). A week after the bill was signed, I asked readers what—if anything—they would do regarding the Roth conversion option.
Each month, Bells & Whistles highlights recent product introductions that plan sponsors may find of interest. More information on these announcements can be found on www.plansponsor.com. If you have a product announcement that you believe would be of interest to our readers, drop us a line at firstname.lastname@example.org.
Note: Plan-year deadlines assume 12/31 plan year-ends
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