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Browsing Defined Contribution

Multiple employer plans – fiduciary litigation risk – introduction

Multiple employer plans (MEPs) are emerging as a provider-based alternative to single employer 401(k) plans, particularly for smaller employers. It seems likely that, as these MEPs accumulate assets, they will begin to be the target of the same sort of fiduciary litigation that has afflicted the single employer 401(k) plan community. In this introductory article…Read More

Annuity Purchase Update: February 2021 Interest Rates

De-risking defined benefit pension plans through the purchase of annuities has been executed by companies of all sizes as a way to manage their liabilities and expenses. In 2020, $26.5B of annuities were purchased by plan sponsors. Many frozen plans implement this strategy to move them a step closer to their ultimate end game.

DOL publishes limited guidance on missing participants, allows transfers from terminating DC plans to PBGC program

DOL’s “best practices” document outlines its view of the “best practices that the fiduciaries of defined benefit and defined contribution plans, such as 401(k) plans, can follow to ensure that plan participants and beneficiaries receive promised benefits when they reach retirement age.” The document begins by identifying “red flags,” then discusses issues with respect to census/plan data, communications, missing participant search, and documentation.

Annuity Purchase Update: January 2021 Interest Rates

The COVID-19 pandemic brought on numerous negative consequences, including a sharp market decline, reduced employee workforces, and decreased overall productivity. This caused plan sponsors to shift their priorities away from their pension plans and place annuity purchase transactions on hold during the second and third quarter of 2020.

2021 Retirement policy legislative agenda

With the Democrats in control of both houses of Congress, they are now in a position to move legislation. In what follows we discuss, briefly, the procedural issues that may limit what legislation may be viable, and then consider a variety of proposals that indirectly or directly affect retirement policy that Democrats may consider giving priority.

New Administration, new Congress

With the focus currently on how President-Elect Biden will staff his new Administration and on the change in control of the Senate, we provide a brief review of the key Administration jobs that President Biden will have to fill, and the key Congressional leadership, that directly affect retirement savings policy, and some of the issues they will be considering.

DOL releases final fiduciary advice Prohibited Transaction Exemption

On December 16, 2020, the Department of Labor released a final class Prohibited Transaction Exemption (PTE) allowing “investment advice fiduciaries … to receive compensation, including as a result of advice to roll over assets from a Plan to an IRA, … that would otherwise violate the prohibited transaction provisions of [ERISA] and the Code.”