Blog Entries

Brass Tacks of Fee Disclosure - Part 2

Mon, 01 Mar 2010 00:00:00 +0100

So my last blog on Fee Disclosure left us with some open issues. Namely we still need to help participants understand two things:

The impact of the identified costs on their future retirement savings, and
How their choices within the Plan can change those costs and outcomes.

So how could we do that on participant statements along with the simple disclosure I outlined previously?

Remember, realistically, we have to boil it down to a standardized formula/format that wil [...]

The Brass Tacks of Fee Disclosure

Fri, 05 Feb 2010 00:00:00 +0100

As I mentioned in my post last week, we (the industry) need to come up with a disclosure that truly (and simply) explains who is getting paid what, for what, how, and by whom, along with a participant-specific dollar figure of costs incurred – then explains how the participant can affect their own plan costs based on their choices. This is no small task.

There is no doubt that fees within 401(k) Plans are confusing at best ... deceptive at worst.

This v [...]

Obama-Save

Wed, 27 Jan 2010 00:00:00 +0100

“Obama-Save” (as opposed to Obama-Care)

On Monday, January 25, 2010, the White House released a fact sheet on their Middle-Class Task Force initiatives. The fact sheet has few details, but there is a great summary of the retirement-related initiatives here on PlanSponsor.com. I have a number of thoughts and concerns about these initiatives that I’ll outline below.

Let me just say up front: commission-based investment advisors and insurance product sellers (and maybe Mr. [...]

Counting Your Blessings

Wed, 25 Nov 2009 00:00:00 +0100

I wanted to post something wonderful for Thanksgiving to express my personal feelings about this uniquely American holiday. This essay by PatriotPost says it all. Wishing you and yours a blessed holiday filled with family, friends, fun and food! --Vicki Zahand

Count Your Blessings – November 25, 2009

"These are the times that try men's souls. The summer soldier and the sunshine patriot will, in this crisis, shrink from the service of his country; but he that stands it n [...]

Personal Responsibility

Tue, 24 Nov 2009 00:00:00 +0100

The shift in the benefits industry over the last several decades from pension plans to 401(k) plans and traditional indemnity medical plans to consumer-driven health plans has ushered in an era of “personal responsibility”. In “the old days” employers took responsibility for all of the decision making around benefits for their employees. The traditional pension plan said to the employee: “We’re handling it. Your pension will provide your retirement income, so you don’t have to w [...]

5500 Filed, Yes, But Did You Read It?

Tue, 03 Nov 2009 00:00:00 +0100

We’ve passed the extended filing deadline for 2008 Form 5500’s by a couple of weeks now. So you can check that task off of your list until next year. But I want to ask you a serious question …

Did you read it?!?

I mean did you really read it before filed it? Or were you cutting the filing deadline so close that when you got the final package in your hand you just put it in the mail to get it out the door? (Been there, done that ...)

[...]

Obama's Retirement Reform

Tue, 13 Oct 2009 00:00:00 +0100

When now President Obama was campaigning last fall, the picture for the 401(k) was even worse, with hints of “free” withdrawals, nationalized retirement programs, and other ideas to kill the 401(k). Now he just wants to “tweak” retirement savings with the intent of encouraging worker savings over spending, and … wait for it … thereby reducing the trade deficit … really?!?

Interestingly, the proposed changes are largely “administrative” (read “a mess for employer-sp [...]

Managing Fiduciary Responsibility

Wed, 07 Oct 2009 00:00:00 +0100

Under ERISA, a plan fiduciary is anyone who:

 Exercises discretionary authority in the management of the plan
 Gets paid for regularly providing investment advice
 Exercises any discretionary authority in the administration of the plan

Fiduciaries in an organization typically include:

• Board of Directors
• CEO, CFO, CIO
• Investment or retirement plan committee members

Benchmarking Your Plan

Wed, 30 Sep 2009 00:00:00 +0100

Benchmark your plan! Benchmark your plan!
Make sure you’re not paying too much!
Make sure it’s competitive!
Make sure it’s compliant!

The pressure is on you as the Plan Sponsor to make sure the retirement plan you’re providing for your employees is the best it can be. You know you need to benchmark your plan, but you’re not sure HOW.

Here are a few options to consider:

Request for Proposal (RFP) – Do a full-blow [...]

Plans in a World of Layoffs

Tue, 22 Sep 2009 00:00:00 +0100

I had a conversation recently with an HR professional whose company has suffered significant layoffs in the last year. As we discussed their situation – a construction related industry with projects drying up – she indicated they had 1,200 employees this time last year and now had only about 700.

Being a retirement plan geek, I asked if they had fully vested those people they’d laid off since it sounded like they had a partial plan termination in their 401(k). She paused for a m [...]

Fiduciary Due Diligence Files

Tue, 15 Sep 2009 00:00:00 +0100

How’s your Due Diligence file look? If the IRS or DOL came in tomorrow, would you have all of the documents related to your plan in one central location, and organized for easy retrieval? No? You need to make a project out of this and get organized!

All Plan Sponsors should maintain a central due diligence file to uphold your fiduciary responsibility. It also comes in handy at audit time – both annual ERISA audits and in the unfortunate event of an IRS or DOL audit.

So wha [...]