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| Fiduciary Rule Could Have Unintended Consequences |
| In 2010, the Department of Labor proposed a new
definition of fiduciary. But, it retracted that proposal based on retirement
industry concerns, and has recently reissued what it now calls a proposed
conflicted investment advice rule. CEO of the American Retirement Association
Brian Graff, during the American Society of Pension Professionals and
Actuaries’ (ASPPA’s) first-ever virtual conference, said the proposed rule is
very broad in whom it captures as an Employee Retirement Income Security Act
(ERISA) fiduciary, and he contended the proposal creates a significant
challenge for conversations with participants about what to do with their
money.Read more > |
| GOP Senators Demand More Time for Fiduciary Feedback |
| Sen. Lamar Alexander (R-Tennessee), chairman of
the Senate’s Health, Education, Labor and Pensions Committee, led a group of 36
Senate Republicans requesting the Department of Labor (DOL) extend the comment
period for its proposed rule on the fiduciary definition. Other groups have
already expressed dissatisfaction with the 75-day timeline for comments; the
Republican senators’ letter is urging the DOL to extend it to 120 days.Read more > |
| Index Fund Proxy Voting and Fiduciary Liability |
| A recent report from Wintergreen Advisers argues
there is a critical flaw underlying the current trend of plan sponsors pushing
more and more assets into lower-fee index funds—a flaw that could be construed
as a fiduciary violation. The report’s title doesn’t mince words: “How the
Votes of Big Index Funds Feed CEO Greed and Put Americans’ Retirement Savings
in Peril.” Neither do David Winters, CEO of Wintergreen Advisers, and Liz
Cohernour, chief operating officer (COO) of Wintergreen, in discussing what
they see as major failures on the part of the big index fund providers to
ensure individual investors are treated fairly.Read more > |
| Boomers and Gen X Call Retirement Passe |
| Baby Boomers are in the throes of retirement,
and Generation X is only steps behind. According to Generations Apart—a new
study from Allianz Life Insurance Company of North America—the vast majority of
both groups believe the traditional definition of retirement is a “romantic
fantasy of the past.” More than eight in 10 (84%) from both generations said
they feel that a retirement starting at age 65 spent “doing exactly what you
want” is now unrealistic.Read more > |
| You Failed Nondiscrimination Testing, Now What? |
| According to a survey from Judy Diamond
Associates, nearly 60,000 401(k) plans failed Internal Revenue Service (IRS)
nondiscrimination testing, with more than one in 10 issuing corrective
distributions to highly compensated employees (HCEs) in 2012. “The plan design
is by far the best way to get to a point where more employers are passing their
nondiscrimination testing,” says Geno Cufone, senior vice president, retirement
administration, at Ascensus in Dresher, Pennsylvania.Read more > |
| Money Market Reform Likely to Change Plan Investments |
| Money market fund reforms, which take effect in October
2016, will require retirement plan sponsors to review the money market funds in
their lineups and possibly replace their funds, experts say. And this will
affect nearly two-thirds of plans, as 63.5% have money market funds in their
lineup, according to the 2014 PLANSPONSOR Defined Contribution Survey. The rule
amendments require investment managers to establish a floating net asset value
(NAV) for institutional prime money market funds. The rule also allows
non-government money market funds to use liquidity fees and redemption gates.Read more > |
| Congressional Bill Would Junk Cadillac Tax |
| Representative Joe Courtney (D-Connecticut)
unveiled legislation from the House Ways and Means Committee to repeal the
excise tax on high-cost health insurance plans scheduled to go into effect in
2018. The policy, sometimes referred to as the “Cadillac tax,” would apply a
40% tax to health insurance expenditures over $10,200 per person and $27,500
per family—it is one of the most controversial provisions of the Patient
Protection and Affordable Care Act (ACA).Read more > |
| Share the good news with a friend! Pass the Dash along – and tell your
friends/associates they can sign up for their own copy.Read more > |
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