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Hosting an industry conference? Ask us about including it in this ticker? Trending Topics for ERISA Plan Sponsors: Week Ending 1/27/17 Trending Topics for ERISA Plan Sponsors: Week Ending 1/27/17
January 30
00:03 2017

Welcome to 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. “When everybody’s a fiduciary…  no one is.”

FiduciaryNews Lead Story:
Industry Veterans Answer: Shall We Praise the 401k or Bury It?,” (, January 24, 2017) Are we burying the 401k to dredge up the rotted carcass of an extinct notion, or are we burying it as we bury a seed, to feed it, to nurture it, so it may grow into a mighty tree that bears fruit when we need it.

Compliance – Holes, Fences and Falling Rocks:
These are all impediments towards achieving an objective. If the goal happens to be a comfortable retirement, there are plenty of obstacles, even along the best routes. What to do? Isolate them. Alienate them. Eliminate them.
Everything You Wanted to Know About Form 5500,” (PLANADVISER, January 20, 2017) This form is one of the vertebrae on the spine of retirement plan compliance.
‘Father of 401k’, DC Expert Suggest Retirement Security Improvements,” (PLANADVISER, January 23, 2017) Ted Banna shares several good ideas, most of which are less controversial than other people’s proposals.
Number of DB plan closures could increase in 2017,” (Employee Benefit Adviser, January 24, 2017) The expectation of lower corporate tax rates might just be the final nail in the coffin from many pension plans.
How to build a stronger 401k,” (BenefitsPRO, January 25, 2017) “Gentlemen, we can rebuild it. We have the technology. We have the capability to build the world’s first easily accessible retirement plan. 401k MEPs will be that plan. Better than it was before. Better, stronger, faster.” We may have the technology, but we don’t have the legislation. Let’s get that legislation.
How to Remove ‘Friction’ From the 401k System,” (The 401(k) Specialist, January 26, 2017) The ‘friction’ refers to the obstacles facing employees who wish to move their retirement account from their old employer’s 401k plan to their new employer’s 401k plan. Seem it would be a whole lot easier if those employees were in a 401k MEP.

Fiduciary – “Fiduciary” Means “Forever”:
When an idea’s time has come, there’s no defeating it. Although it may have taken years to burn “fiduciary” in the minds of the marketplace, no delay, no redraft, no rescission, will have remove that scar. “Fiduciary” means “forever.”
Trump’s Regulatory Freeze Might Delay Fiduciary Rule,” (Financial Advisor, January 23, 2017) President Trump issued a general regulatory freeze similar to what his immediate predecessor did in 2009. The article states this may delay implementation of the Fiduciary Rule by one month.
Fiduciary Era Is Here, Regardless Of DOL Rule, B-Ds Say,” (Financial Advisor, January 24, 2017) You may have already read this months ago. For example, here (“Retirement Advisers Speak Out on Next President: Trump Trumps Fiduciary Rule,”, October 25, 2016) and, here (“‘Houston, the Fiduciary Has Landed.’ Where Does ‘Fiduciary’ Go From Here?, December 6, 2016).
How President Trump’s Conflicts Can Help RIAs,” (ThinkAdvisor, January 25, 2017) While being careful not to take sides, Knut Rostad points out how the upcoming “conflict-of-interest” lawsuits against President Trump will benefit the fiduciary argument by highlighting the dangers of conflicts-of-interest. Even if a judge rules President Trump’s business concerns that pre-date his entry into politics don’t represent a conflict-of-interest, that will educate investors on the difference between real and perceived conflicts-of-interest. Either way, it helps promote the importance of working with a fiduciary.
Fiduciary’s Personal Property Among ESOP Damages Owed,” (PLANADVISER, January 25, 2017) When it rains it pours for anyone who breaches their fiduciary duty.

Fees – And You Can’t Reverse “Forever”:
The big marketers know the worst thing to do is swim against the current. When the market says “Fiduciary is here to stay,” you’d best rebrand everything under that “Fiduciary” umbrella. This begs the question, though. “If everything is ‘fiduciary,’ then is nothing ‘fiduciary’?”
‘No Going Back’ on Commissions, Fiduciary Changes, Broker-Dealer CEOs Say,” (ThinkAdvisor, January 24, 2017) We’ve been saying this for a while (see above section). The horse has been let out of the barn. The cat is out of the bag. The movement towards “fiduciary” as a marketing standard is beyond “getting started.” It is settled science. It is here to stay.
Morgan Stanley to Reduce Wealth Fees Even With Rule Uncertainty,” (Financial Advisor, January 26, 2017) And this is precisely what we mean…

Investments – Risk Takers and Risk Followers:
There are two types of bad investors in the world: those that take unnecessary risks and those that follow to avoid risk. When taking a risk, make sure it’s a smart risk. When avoiding risk, don’t believe there is safety in numbers.
Some Helpful Tips For Investing In Real Estate Using Retirement Funds,” (Forbes, January 24, 2017) This article represents an optimistic assessment of such investments. It’s not balanced in the sense that it doesn’t reflect the downside risks when using retirement funds to invest directly in real estate properties.
What Happened to 401k Target Date Funds in 2016?” (The 401(k) Specialist, January 26, 2017) Who knew? Target Date Funds have as much variability in returns (even with the same “target” date) as regular ol’ mutual funds.

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.
School Employees Need More Education On Retirement Plans,” (Financial Advisor, January 23, 2017)
Self-Dealing Lawsuit Filed Against Charles Schwab,” (PLANADVISER, January 23, 2017)
Rise in self-employed boosting solo 401k, SEP IRA usage,” (Employee Benefit News, January 24, 2017)
Start planning 401k financial wellness education,” (Employee Benefit Adviser, January 25, 2017)
IRAs In Tough Times,” (Wealth Management, January 25, 2017)
401k plans make big fund changes following new money market rules,” (InvestmentNews, January 25, 2017)
Recommendations Made to Support ERISA Account Consolidations,” (PLANADVISER, January 25, 2017)
Why employers, employees should revisit their 401k,” (Employee Benefit News, January 25, 2017)
JPMorgan sued for self-dealing in its 401k plan,” (InvestmentNews, January 26, 2017)
A Critical Checklist for 401k Fiduciary Liability Insurance,” (The 401(k) Specialist, January 26, 2017)
Investment Provider Sued Over Own 401k Plan Fees,” (PLANADVISER, January 26. 2017)

Trends and Truths 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.
All Worry About Retirement,” (PLANADVISER, November/December 2016)
Millennials Spend More on Coffee(!) than 401k Investments,” (The 401(k) Specialist, January 22, 2017)
The Divorce Penalty: This 401k Fee Can Add Insult To Injury,” (Financial Advisor, January 23, 2017)
A health savings account could power your retirement,” (MarketWatch, January 23, 2017)
Best and worst states to retire,” (CNBC, Wyoming, Janaury 23, 2017)
What’s in and what’s out for retirees in 2017,” (Yahoo Finance, January 23, 2017)
Young People Falling Behind Financially,” (Financial Advisor, January 24, 2017)
Retirement Planning Can Be Tripped Up by Cognitive Decline,” (Money, January 24, 2017)
3 often overlooked risks that can jeopardize retirement,” (BenefitsPRO, January 24, 2017)
Re-Enrollments, A Powerful Tool, Have Yet to Catch On,” (PLANADVISER, January 25, 2017)
How home buyers can tap an IRA penalty-free,” (Employee Benefit News, January 26, 2017)
Generations Split on Retirement Preparedness,” (PLANADVISER, January 26, 2017)
401k Withdrawals: Are We Too Young to Avoid a Penalty?” (Money, January 26, 2017)
6 Smart Ideas To Retire Rich,” (Forbes, January 26, 2017)

Wisdom from Some of Our Favorite Blogs:
That 401k Site: Interview: Chris Carosa, |
Scholarly Financial Planner: Investment Consumers: Protect Thyself with This Questionnaire; Find Your BFF |
The Retirement Plan Blog: In the complicated world of ERISA, a Fiduciary Checklist can help |
The Rosenbaum Law Firm P.C. Blog: DOL puts out another Fiduciary FAQ |
The Rosenbaum Law Firm P.C. Blog: Apples and Oranges: Rollovers, Qualified Plans, and The Best Interest Exemption |
Squared Away Blog: Can Work Enhance Senior’s Social Lives? | The Magic Staircase of 401k |
Behavior Gap: The Valuable Currency of Time |
The Rosenbaum Law Firm P.C. Blog: The backbench is your future |
The Rosenbaum Law Firm P.C. Blog: Schwab is the next defendant in Which Plan Provider’s 401k, we should sue |
Behavior Gap: What It Means To Be a Real Financial Advisor |

Hot Tips from Popular Web Resources:
The Motley Fool: Saving for College? Consider a Roth IRA |
NAPA Net: Did President Trump’s Executive Order Push Back the Fiduciary Rule? |
NAPA Net: What Are Your Interview Red Flags? |
NAPA Net: What Are Plan Sponsor Concerns About the Fiduciary Rule? |
The Motley Fool: Which IRA Offers the Best Tax Benefits? |
NAPA Net: Another Provider Charged with ‘Self’ Dealing in its 401k Plan |
NAPA Net: Are Auto Engagements Over? |
NAPA Net: Advisors Find Shifting Retirement Concerns Post-Election |
NAPA Net: More Disruptive Than the Fiduciary Rule? |
NAPA Net: Will the DOL Fiduciary Rule Face a Regulatory Freeze? |
NAPA Net: Study Spotlights Another Benefit from State-Run Retirement Plans |
NAPA Net: Requests for More Detail on Employer Duties Under OregonSaves Fueled Revisions |
Morningstar: Should You Make After tax Contributions to Your 401k? |
NAPA Net: Proprietary Fund Suit Alleges ‘Baked-in’ Bias |
NAPA Net: The City That Never Sleeps Should Take a Nap |
NAPA Net: House Ways & Means Chair: ‘We’re Seeking Ideas’ |
NAPA Net: Study Says Most Have a Plan for Their Rollover |
NAPA Net: Match Moves Minimal in 2016, But What About 2017? |
NAPA Net: Confirmation Hearing for DOL Nominee Puzder Delayed Again |
Kiplinger: I’m a Landlord: Can I Ever Truly Retire? |
The Motley Fool: IRS Form 1099-R: What Every Retirement Saver Should Know |

Miss anything? Feel free to add a comment below.

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Christopher Carosa, CTFA

Christopher Carosa, CTFA

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