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Hosting an industry conference? Ask us about including it in this ticker? Trending Topics for ERISA Plan Sponsors: Week Ending 6/9/17 Trending Topics for ERISA Plan Sponsors: Week Ending 6/9/17
June 12
01:09 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:
What’s the Immediate Impact of the DOL Fiduciary Rule on 401k Plan Sponsors?” (, June 6, 2017) “Hopefully,” says Reese, “this past year gave employers a better understanding of what they need to look out for to act as fiduciaries for their plan participants.”

Compliance – Separating the Church from the State:
Read it and weep, boys, read it and weep.
Supreme Court rules for religious-affiliated hospitals’ ‘church plans’,” (BenefitsPRO, June 5, 2017) Hence, they are exempt from ERISA. Maybe this means instead of state-run retirement plans for private employees we’ll have church-run retirement plans for private employees. Why not?

Fiduciary – It’s Heeeeere!:
Like an undead poltergeist, the Fiduciary Rule returns, although not without some confusion.
How the DOL Created a 401k Fiduciary Monster,” (The 401(k) Specialist, June 1, 2017) Eugene Scalia, son of the late Supreme Court Justice, paints an interesting picture. He suggests the DOL first committed a regulatory overreach, then deregulated what it had just regulated. Interesting theory. It also explains the DOL misdirection that makes people incorrectly believe the Conflict-of-Interest (a.k.a. “Fiduciary”) Rule actually reduces conflicts-of-interest.
SEC Criticized For Rekindling Fiduciary Fight,” (Financial Advisor, June 2, 2017) Some suspect the SEC is trying to throw a monkey wrench in the DOL’s doings.
SEC Chair Clayton’s Recent Fiduciary Comments Are Revealing,” (PLANADVISER, June 2, 2017) This author sees less of a one-on-one battle and more of a two-part harmony between the agencies.
Planners Fear Unintended Consequences as DOL Rule Compliance Date Nears,” (ThinkAdvisor, June 6, 2017) Fred Reish is quoted as saying he feels, as with most regulation, this will hurt smaller firms more than larger ones.
401k plan sponsors can’t ignore new fiduciary rule,” (BenefitsPRO, June 7, 2017) The DOL may seem like it’s targeting service providers, but the true intent is to protect employee investors, and that means plan sponsors are on the hook, too.
Fiduciary FAQ: What the latest milestone actually means,” (Financial Planning, June 7, 2017) A quick and dirty breakdown of common questions.
U.S. Labor Department Takes Steps To Reconsider Fiduciary Rule,” (Financial Advisor, June 9, 2017) And, we’re off… No sooner did the Rule become effective that talk begins to begin the formal process to change it.

Fees – Let’s All be Reasonable:
If you’re able to use reason, does that make you reasonable?
How much will reasonable compensation be come June 9?” (BenefitsPRO, June 7, 2017) No changes expected right away, but there’s a bigger issue. Does reasonable compensation refer to actual service provider fees only or mutual fund expenses (the latter being operational costs rather than fees)?

Investments – Myths and More Myths:
They never stop, do they?
TDFs Help U.S. Investors Avoid Market-Timing Mistakes,” (PLANADVISER, June 1, 2017) This is true of any buy-and-hold/dollar-cost-averaging approach (the ideal of the 401k) regardless of whether you invest in TDFs or any equity-based fund.
Do SRI Funds Have a Future in 401k Plans?” (Wealth Management, June 2, 2017) Here’s a counterpoint to an article which appeared in a couple of weeks ago (q.v., “When Does “Socially Responsible” Investing Violate Fiduciary Duty?, May 23, 2017).
Seven Myths About Retirement Investing That People Need To Ignore,” (Forbes, June 7, 2017) These are some basics, but there are those who need reminding about them.

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.
5 Best Practices for 401k Investment Committees,” (The 401(k) Specialist, May 30, 2017)
Financial wellness push is promoting the health of 401k plans,” (Employee Benefit Adviser, June 4, 2017)
Amended Excessive Fee Suit Against Chevron Dismissed,” (PLANADVISER, June 5, 2017)
How to Document ‘Best interest’ in 401k Rollovers,” (The 401(k) Specialist, June 5, 2017)
DC Plans’ Goal Is to Help Employees Retire on Time: T. Rowe Survey,” (ThinkAdvisor, June 5, 2017)
Retirement Responsibility Extended for Employers,” (The 401(k) Specialist, June 5, 2017)
How to create a state-of-the-art 401k loan program,” (Employee Benefit News, June 6, 2017)
The Use of Professionally Managed Portfolios Projected to Reach 75% by 2021,” (PLANADVISER, June 6, 2017)
How creativity, flexibility can help employees achieve retirement goals,” (Employee Benefit News, June 6, 2017)
401k Auto-Enrollment Grew by How Much?” (The 401(k) Specialist, June 6, 2017)
The Callan DC Index Posted Strong Gains During First Quarter 2017,” (PLANADVISER, June 7, 2017)
How to create a state-of-the-art 401k loan program,” (Employee Benefit Adviser, June 7, 2017)
DC Plan Participants Keep Withdrawals and Loans Down in 2016,” (PLANADVISER, June 7, 2017)
PSNC 2017: The Effect of Choice on Regret Aversion and Trust in Sponsors’ DC Plans,” (PLANADVISER, June 8, 2017)
What’s really draining employee 401k accounts,” (Employee Benefit News, June 8, 2017)
PSNC 2017: The Top Trends Impacting DC Plans and Participants,” (PLANADVISER, June 8, 2017)
What larger 401k plan sponsors are doing to help employees,” (BenefitsPRO, June 8, 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.
Why kids should stash summer job cash in a Roth IRA,” (Los Angeles Times, June 4, 2017)
Could cutting vacations save retirement?” (BenefitsPRO, June 5, 2017)
Debt-Retirement Asset Split Hits Workers in Their 40s,” (ThinkAdvisor, June 5, 2017)
6 Questions to Ask When Your Company Changes Its 401k,” (US News, June 5, 2017)
How You Can Retire In The Gig Economy: Freelancer Savings Plans,” (Forbes, June 5, 2017)
Millennials expect two-pronged help with retirement,” (BenefitsPRO, June 6, 2017)
This couple is on track to retire – before they turn 40,” (CNN, June 5, 2017)
401k borrowing isn’t free,” (Employee Benefit Adviser, June 5, 2017)
Americans Look to Family to Help Fund Their Retirement: Survey,” (ThinkAdvisor, June 6, 2017)
Survey: Sickest Workers Plan to Retire Latest,” (Money, June 6, 2017)
How do you save for retirement as a freelancer?” (CBS News, June 6, 2017)
Unhealthy habits could destroy your retirement,” (CNBC, June 6, 2017)
Debt-retirement asset split hits workers in their 40s,” (BenefitsPRO, June 6, 2017)
How Prepared for Retirement Are American Workers?” (ThinkAdvisor, June 7, 2017)
Americans Lacking Confidence in Retirement Savings,” (PLANADVISER, June 7, 2017)
What will retirement planning look like in 2020?” (BenefitsPRO, June 7, 2017)
Retirement: Figuring your Social Security break-even age,” (Chicago Tribune, June 7, 2017)
Powell: Three ways near-retirees can avoid investment mistakes,” (USA Today, June 7, 2017)
Money milestones: This is how your finances should look when your kids go to college,” (MarketWatch, June 8, 2017)
Retirement: You Can Save $1 Million Even Starting at Age 50,” (Money, June 8, 2017)
IRAs Serving Their Purpose as a Savings and Rollover Vehicle,” (PLANADVISER, June 8, 2017)

Wisdom from Some of Our Favorite Blogs:
The Rosenbaum Law Firm P.C. Blog: Retirement Plan Advisors Advantage
Business of Benefits: The SCOTUS’s Church Plan Ruling in Stapleton Affirms Both the QCCO’s and Non-QCCO’s Ability to Maintain ERISA Exempt 403(b) Plans |
Squared Away Blog: Slightly More Seniors Living With Family |
The Rosenbaum Law Firm P.C. Blog: When trust is gone, turn out the lights |
The Rosenbaum Law Firm P.C. Blog: Let Former Employees Roll Their Money Out |
The Rosenbaum Law Firm P.C. Blog: The Thing about Payroll Provider TPAs |
Fred Reish: Interesting Angles on the DOL’s Fiduciary Rule #50 |
Nerd’s Eye View: Dynamic Retirement Spending With Small-But-Permanent Cuts |
Proskauer: The United States Supreme Court Rules in Favor of Hospitals on “Church Plan” ERISA Exemption |
Fred Reish: DOL Issues Fiduciary Rule FAQs as SEC Re-Enters Fiduciary Rule Debate |
RetirementRevised: Ready, set, go: New fiduciary retirement advice protections are here |

Hot Tips from Popular Web Resources:
NAPA Net: Chevron Defendants Win Again in Excess Fee Lawsuit |
NAPA Net: The Requirement to Disclose Fiduciary Status – and When |
NAPA Net: Employees Looking for Assistance with Financial Wellness, Study Finds |
Kiplinger: Self-Employed? Go Ahead, Make That IRA Contribution |
The Motley Fool: 3 Facts About Retirement Every Retiree Should Know |
NAPA Net: Supreme Court: Church-Affiliated Plans Are Exempt from ERISA |
NAPA Net: The Value of Good Advice |
NAPA Net: Report Suggests Fee Compression ‘Much Ado About Nothing’ |
NAPA Net: Automatic Investment Plans Show Strong Results in Global Investor Returns Study |
The Motley Fool: 4 401k Strategies to Grow Your Wealth |
NAPA Net: New Communication Strategies Needed to Address Converging Trends, Report Suggests |
NAPA Net: Case of the Week: Federal Withholding and In-Plan Roth Conversions |
NAPA Net: Private Real Estate, Recordkeeping and DC Plans |
NAPA Net: DOL Review of Fiduciary Regulation Takes First Step |
NAPA Net: Financial Crisis Still on Minds of Investors, But Optimism Rising |
NAPA Net: House Approves Legislation to Repeal Dodd-Frank, DOL Fiduciary Rule |
NAPA Net: Survey: Having Metrics in Place Can Lead to Better Retirement Preparedness |

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Christopher Carosa, CTFA

Christopher Carosa, CTFA

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