| | Benefits & Administration | | Education Key to Prompting Participants to Save | | When retirement plan providers take the time to
educate participants about the importance of saving for retirement, this builds
a level of trust that results in higher savings rates and the use of retirement
planning tools, according to the National Association of Retirement Plan
Participants’ (NARPP) second annual Retirement Plan Participant Financial
Empowerment, Literacy and Trust (FELT) Study. The data shows that a provider’s
education program and levels of trust are closely intertwined, says Laurie
Rowley, NARPP’s co-founder and president. Education can create the necessary
trust that encourages people to participate in the plan, increase their
deferral rates, and use retirement planning tools and calculators, she says.Read more > | | Failed Testing an Opportunity to Improve Retirement Plan | | Failed nondiscrimination testing may mean a
retirement plan is not designed to encourage workers to save enough. “The
issuance of corrective distributions … means that the plan has highly compensated
employees who were unable to save as much for their retirements with pre-tax
income as they would like. It may also mean that the plan is not designed to
encourage workers to contribute sufficiently,” says Eric Ryles, managing
director of ALM Financial Intelligence.Read more > | | | Ask the Experts | | “I am a benefits manager who recently became employed
at a large nonprofit after having been in the corporate world. One of my first
responsibilities was to review our existing vendor contracts. Much to my
surprise, when it came time to review our Employee Retirement Income Security
Act (ERISA) 403(b) plan, our vendor indicated that such contracts didn’t exist!
They indicated that they have contracts with the plan participants, but not the
employer. Could this be possible? For my prior employer’s 401(k) plan, we had a
trust agreement, recordkeeping agreement and service agreement. It strikes me
as odd that a 403(b) plan would have none of those things. Am I being
unreasonable in my expectations?”Read more > |
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