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Hardship withdrawals after BBA 2018

The Bipartisan Budget Act of 2018 (BBA 2018), signed into law by President Trump on February 9, 2018, included several modifications to the 401(k) hardship withdrawal rules. While the changes are generally not effective until the 2019 plan year, they will fundamentally change how hardship withdrawals work and present issues both for regulators and plan…Read More

DB endgames

A number of factors are resulting in improved defined benefit plan funding. And as plans approach “full funding,” some sponsors are considering plan termination as an option. In this article we briefly review: (1) the factors/moving parts affecting funded status; (2) (very generally) the effect of recent trends in those factors on plan funded status;…Read More

June 2018 Pension Finance Update

June was another decent month for pension sponsors, rounding out a solid quarter and first half of 2018 for pension finance, as stock markets have eked out modest gains while higher interest rates have decreased pension liabilities. Both model plans we track1 at least held steady again last month – traditional Plan A gained 1%…Read More

Legislative update – June 2018

In March 2018 there was a possibility that all or part of the Senate’s bipartisan Retirement Enhancement and Savings Act of 2018 (RESA), which addressed a number of important retirement policy issues, would be included in omnibus spending legislation that was passed on March 23, 2018. That ultimately did not happen, because of objections raised…Read More

SEC investment adviser proposal

On April 18, 2018, the SEC proposed (1) a “Regulation Best Interest” providing new conduct standards for broker-dealers, (2) an “Interpretation Regarding Standard of Conduct for Investment Advisers” that “reaffirms, and in some cases clarifies, certain aspects of the fiduciary duty that an investment adviser owes to its clients,” and (3) a requirement that investment…Read More

DOL provides temporary enforcement relief for possible prohibited transactions resulting from the Fifth Circuit decision

On May 7, 2018, the Department of Labor published Field Assistance Bulletin 2018-02, Temporary Enforcement Policy On Prohibited Transactions Rules Applicable To Investment Advice Fiduciaries, providing temporary relief for certain prohibited transactions that may result from the Fifth Circuit’s decision vacating the exemptions included in the Fiduciary Rule regulation package. In this article we discuss…Read More

Field Assistance Bulletin 2018-1 – DOL clarifies guidance on economically targeted investments and proxy voting, again

On April 23, 2018, the Department of Labor published Field Assistance Bulletin (FAB) No. 2018-01 on Interpretive Bulletins (IBs) 2015-01 (economically targeted investments) and 2016-01 (proxy voting). The issue of economically targeted investments (ETIs) (particularly) has become “political,” with the Clinton, Bush, Obama and (now) Trump DOL’s all weighing in with (differing) guidance on it….Read More

The SEC proposes broker/investment adviser conduct rules

We concluded our article Fiduciary Rule vacated: significance for plan sponsors with the observation that sponsor fiduciaries will want to review follow-on guidance on broker/adviser conduct that the Department of Labor or the Securities and Exchange Commission publishes. On April 18, 2018, the SEC, by a 4-1 vote, proposed (1) a “Regulation Best Interest” providing…Read More

Fiduciary Rule vacated: significance for plan sponsors

How will the Fifth Circuit’s decision, in Chamber Of Commerce of the United States of America, et al. v. United States Department of Labor, to vacate the Department of Labor’s Fiduciary Rule affect plan sponsors? In this article we begin with a brief summary of the current situation post the Fifth Circuit decision. We then…Read More

Retirement Enhancement and Savings Act of 2018 Introduced in Senate

On March 8, 2018, Senators Hatch (R-UT) and Wyden (D-OR), Chairman and Ranking Member of the Senate Finance Committee, introduced the Retirement Enhancement and Savings Act of 2018 (RESA), addressing a number of important retirement policy issues. The bill has bipartisan support in the Senate and could be included in omnibus spending legislation expected to…Read More