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FiduciaryNews Trending Topics for ERISA Plan Sponsors: Week Ending 9/11/15

FiduciaryNews Trending Topics for ERISA Plan Sponsors: Week Ending 9/11/15
September 14
00:02 2015

1020805_25983300_Trending_Topics_2015.09.14_stock_xchng_royalty_free_300Welcome to FiduciaryNews Trending Topics. Each Monday, we’ll give you a quick synopsis of the major news events and trends impacting ERISA plan sponsors, 401k fiduciaries and those in the business of supporting these fine folks. If you smile when you read these entertaining snippets, well, that’s the idea. If you think we’re missing something important, then please let us know. But, note this well, we avoid press releases masquerading as news stories (even though they might be reported by journalists) as well as mass media pabulum that merely mouths investment myths and mistakes.

FiduciaryNews Lead:
A Fiduciary Solution to the Social Security Problem,” (, September 9, 2015) Ultimately, to survive, Social Security must evolve into a defined contribution system and away from its current Ponzi Scheme structure.

Compliance – A Rising Tide to Reduce Dependency on Defined Benefits:
Numbers have a terrible tendency to offer a dispassionate analysis. The drumbeat of reality is slowly marking the ultimate death of defined benefit plans. They never really could work in the long-term. But, the rackets were never designed to work forever.
Social Security Q&A: Won’t Maximizing Benefits Bankrupt Social Security?” (Forbes, September 4, 2015) Here’s another clue for you all: It’s going bankrupt anyway. It’s a Ponzi Scheme. That’s what Ponzi Scheme’s do. Accept it.
States to Help Workers Save for Retirement,” (Wall Street Journal, September 7, 2015) We’ve said it before and we’ll say it again, “If you like Social Security, you’ll love this idea.” Better yet, if you want proof, see if this is being promoted by only one political party and which one is doing the promoting.
AIG freezes pension,” (BenefitsPro, September 7, 2015) Another one bites the dust. If all the smart corporations are canning their pension plans, what makes public pension plan fiduciaries think the math is any different for them?
3 ideas that could reshape the U.S. retirement system,” (Benefit News, September 8, 2015) First, the ideas aren’t new. Second, they’re based on a survey of people who are not experts in the area. Third, there appears to be a basic philosophical difference between the attitude of the survey takers and the demeanor of true behavioral finance researchers. You might want to read the comments on this one.
Corporate, public pension plans suffer in August turmoil,” (BenefitsPro, September 9, 2015) This are bad, but we already knew that. They get worse when the market goes down. But we already knew that, too. The trouble with pension plans is that it’s like living off the market value – not the income – of a fixed income instrument. They’re just not designed for that.
Avoiding a pension risk management apocalypse,” (Employee Benefit News, September 9, 2015) Like flies to rancid meet, is there no problem that won’t attach itself to the time honored pension plan.
Who’s brave enough to take these 3 easy steps to unshackle retirement?” (BenefitsPro, September 9, 2015) There is no other end game for Social Security other than a bail-out. Get used to the idea, folks.

Fiduciary – All’s Quiet on the East Coast Front:
For now. Soon, very soon, we’ll see the morning sunlight glistening off the tips of the spears rising about the crest on the hill to the east. Then, and only then, should you prepare yourself.
With Congress back Tuesday, get ready for a fiduciary fight,” (InvestmentNews, September 4, 2015) Maybe. There’s a better chance no one pays attention as the presidential campaign unofficially launches on Labor Day and this doesn’t even come close to getting headlines. The Iran Deal, yes, the Fiduciary Standard, less likely. Too bad, as they both have this “best interests” idea at their heart.
Fiduciary September: A Time for Client-Centered Advisors to Come Together,” (ThinkAdvisor, September 10, 2015) Bob Clark is as hard hitting as ever.

Fees – Closed for Labor Day:
Maybe we’ll see something next week.

Investments – Where Do You Go When the Pepsi Gets Flat?:
In a potpourri of stories we learn we just can’t learn anything at all.
401k participants move from equities to fixed income,” (Benefit News, September 4, 2015) Oops! Perhaps this is a bullish sign. It wouldn’t be the first time.
Companies Embrace Customized Target-Date Funds in Retirement Plans,” (Financial Planning, September 8, 2015) Does it really change anything?
Retirement investing is all about one thing,” (MarketWatch, September 9, 2015) Ironically, the article talks about three things. Which tells you everything you need to know about the credibility of the article.
401k plan money market fund changes are coming,” (Employee Benefit News, September 10, 2015) This is potentially important. Better check your option menu to see if you might be impacted.
Is General Motors’ 401k annuity choice a harbinger for broader uptake?” (InvestmentNews, September 10, 2015) Larger plans (or, more appropriately, their employees) are often proving ground (read: “guinea pigs”) for experimental ideas. It’ll be interesting to see how this is reported if there’s relatively little interest or if the products end up promising more than they can deliver.

Major Plan Sponsor Moves and News:
What are other plan sponsors and fiduciaries doing with their plans? And how are participants responding? The latest in legal proceedings involving plan sponsors and fiduciaries.
The Power of the Backdoor Roth IRA,” (U.S. News, September 3, 2015)
Homemakers are at risk in retirement,” (BenefitsPro, September 4, 2015)
ESOP fiduciaries accused of breach of fiduciary duty,” (BenefitsPro, September 4, 2015)
When you can and cannot convert 401k plans to Roth IRAs,” (MarketWatch, September 4, 2015)
GAO: Confusion In 401k Default Rules Could Hurt Retirees’ Nest Eggs,” (Financial Advisor, September 8, 2015)
401k plan access seen to promote financial confidence,” (Benefit News, September 9, 2015)
2 Mental Roadblocks That Keep Us From Saving,” (Forbes, September 9, 2015)
Small IRA Accounts Are Bigger Than They Appear, DOL Says,” (Financial Planner, September 11, 2015)

Trends and News for Retirement Savers:
If you’re a retirement plan fiduciary – whether a plan sponsor or a financial professional, don’t you think it’s a good idea to keep up on the topics retirement savers are most interested in? That’s what the media tries to do. Here’s what they think is on the mind of the people saving for retirement.
Half of homemakers have no retirement strategy,” (CNBC, September 3, 2015)
Mortgage debt — the new retirement time bomb,” (The Washington Post, September 6, 2015)
Disabilities Can Alter the Route to Retirement,” (Financial Planning, September 7, 2015)
What if you just can’t afford to fully retire?” (CBS News, September 7, 2015)
6 Tips for Going Back to School in Retirement,” (U.S. News, September 8, 2015)
6 Things To Consider When Investing A Lump Sum,” (Forbes, September 8, 2015)
How to Help Your 401k Balance Grow Faster,” (Wall Street Journal, September 9, 2015)
What millennials should know about retirement planning,” (CNBC, September 9, 2015)

Wisdom from Some of Our Favorite Blogs:
Data “Points”: 5 Things You CAN Do After a Market Correction |
Nerd’s Eye View: Robo-Advisors Won’t Help Advisors Serve Millennials |
The Chicago Financial Planner: Financial Planning Steps for the rest of 2015 |
fi360: Understanding Marketing Volume V: Retargeting |
Boston ERISA Law Blog: What Should Clients and Their Lawyers Learn from Deflategate? |
Squared Away Blog: In Support of Allowances for Kids |
The Retirement Plan Blog: ERISA Plans Do Have Their Limitations |
ERISA Lawyer Blog: District Court Finds Investment Selection Violates ERISA Fiduciary Rules, But Damages Are Not A… |
Behavior Gap: Pull Out Your No Shame, No Blame Hat for Better Money Decisions |
fi360: Identifying the fiduciaries |
Scholarly Financial Planner: Which of These Two Visions of the Future of Financial Advice Will Become Reality? |

Hot Tips from Popular Web Resources:
Kiplinger: The Market Correction and Your Retirement Plan |
NAPA Net: Could Better Regulations Lead to Better QDIA Choices? |
NAPA Net: 10 Ways the Class of 2019’s 401k Will Be Different |
NAPA Net: The Language You Use DOES Matter |
Kiplinger: Choosing an HSA-Eligible Insurance Policy |
Morningstar: A New Tool for Retirement Income |
NAPA Net: Fiduciary Proposal Comment Period Closing |
NAPA Net: Case of the Week: Correcting Plan Participant Overpayments |
NAPA Net: Could DOL’s Fiduciary Rule Hurt Investors During Market Volatility? |
NAPA Net: IRS Teams up with DOL to Find Form 5500 Non-Filers |
Motley Fool: The Famous 4% Rule Can Doom Your Retirement |
NCPA: Hillary Clinton’s Corporate Profit-Sharing Plan – It’s Nothing to Get Excited About |
NAPA Net: Survey: Plan Sponsors Seeking More Participant Engagement |
NAPA Net: Coaching: More Powerful and Safer Than Advising? |
NAPA Net: Failure to Communicate Clips Plan Limitation |
NAPA Net: What Retirement Readiness Really Means |
NAPA Net: Fiduciary ‘Grievances’ Aired at House Hearing |
NAPA Net: Never Forget |
NAPA Net: What’s in YOUR In-Basket(s)?
NAPA Net: Minsky: Mega Market Trends Migrating Down Market |

Miss anything? Feel free to add a comment below.

About Author

Christopher Carosa, CTFA

Christopher Carosa, CTFA


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