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Hosting an industry conference? Ask us about including it in this ticker? Trending Topics for ERISA Plan Sponsors: Week Ending 12/22/17 Trending Topics for ERISA Plan Sponsors: Week Ending 12/22/17
December 26
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:
Exclusive Interview: Ted Beck – 401k Process Must Be Demystified,” (, December 19, 2017) “I am behind any idea that puts savings on autopilot and takes a lot of thought out of it. Take for example every time we get a raise in our salary. We should automatically have our savings contributions adjust accordingly when that happens.”

Compliance – A Light in the East:
“Light” = a new day, a new hope. “East” = the approaching horizon, the near future. Something about this season that just makes a “star” (a.k.a. “light”) and East an appropriate hopeful metaphor for what we might see in a bill next year (see the article below).
Fees Rise for Underfunded Pensions,” (Bloomberg, December 14, 2017) This means workers’ retirements are at greater risk. Oh, why can’t we simply return to those glory years when everyone had a pension plan… oh, wait. Right. These are pension plans. Never mind.
Some See the Stars Aligning for a New Pension Protection Act,” (PLANADVISER, December 18, 2017) What could this possibly mean? “MEPs,” “Rothification,” oh my!
Breaking down retirement provisions in the tax reform bill,” (Employee Benefit Adviser, December 20, 2017) Here’s the good news. Better news: there’s no bad news.
PBGC Provides New Table for Determining Expected Retirement Ages,” (PLANADVISER, December 20, 2017) These are for plans in distress.
Tax Bill Affects IRA Conversions, Loans, 529s, NQDC Plans,” (PLANADVISER, December 21, 2017) And your take home pay, too.

Fiduciary – Veni Redemptor Gentium:
Translated O come, Redeemer of the Earth, this first (fourth century) Christmas Carol evokes the sense of returning to first fruits, much like we see in the theme of these fiduciary articles.
How Do Fiduciary Ties Affect When Clients Can Sue?” (ThinkAdvisor, December 14, 2017) Now this is a question worth getting the answer to.
Nonprofit Plan Sponsors Require Deeper Fiduciary Education,” (PLANADVISER, December 18, 2017) This could be a problem – for employees of nonprofits.
Fiduciary Concerns When Considering Managed Accounts,” (PLANADVISER, December 21, 2017) Always a concern.

Fees – Ding Dong Merrily on High:
Look, when if comes to fees, we’ve been ding-a-lings for some time now.
Average Worker Will Pay More Than $150K in 401k Fees,” (PLANADVISER, December 15, 2017) If you think that’s bad, over that same time period, the average worker will pay nearly $700K on used cars If they want a new car, they will pay more than $1.2 million. Isn’t your retirement worth more than a car? Why, then, are people only willing to pay a fraction of the cost for something more important?
Revenue sharing? What’s that?” (BenefitsPRO, December 18, 2017) It seems incredible in this day of fee awareness and a heightened sense of “fiduciary” that a full 30% of plan sponsors don’t know if they’re paying revenue sharing fees. That sounds like a class action waiting to happen.
Schlichter expects plaintiffs to be vindicated in 2 critical retirement plan suits,” (BenefitsPRO, December 20, 2017) Time will tell.

Investments – We Wish You a Merry Christmas:
Is it possible for a Santa Claus Rally to last more than a year? It may if, as many are now beginning to suspect, the year-end signing of the new tax reform law becomes a gift that keeps on giving.
DC Plan Participants Favored Fixed Income in November,” (PLANADVISER, December 18, 2017) The good news is there’s a decline in short-term trading. The bad news is there’s an increase in short-term investing.
Trump Asks ‘How’s Your 401k?’ But Most Voters Don’t Have One,” (ThinkAdvisor, December 19, 2017) But they do have an IRA or an IRA Rollover. This is like saying “most people don’t own stocks” even though they do own mutual funds that own stocks. Oh, wait, the article makes this faux pas, too.
Trump Tax Bill Terrific for 401k Plans: Opinion,” (The 401(k) Specialist, December 19, 2017) Point, meet Counter-Point.
How (and why) to use active management in your 401k plan,” (Employee Benefit News, December 22, 2017) Very good overview of the often ignored dangers of passive investing.

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.
How the GOP tax reform bill could affect small business 401k plans,” (Employee Benefit News, December 15, 2017)
Federal Judge Summarily Dismisses Delta Air Lines ERISA Fee Lawsuit,” (PLANADVISER, December 18, 2017)
Top 10 Priorities for 401k Plans in 2018,” (The 401(k) Specialist, December 19, 2017)
Research Questions Value of Old School Financial Education,” (PLANADVISER, December 19, 2017)
Retirement industry year in review: An eventful 2017,” (BenefitsPRO, December 19, 2017)
Institutional Investment Lineups May Have Reached Their Smallest,” (PLANADVISER, December 19, 2017)
Employers tackle low participation rates in financial stability programs,” (Employee Benefit Adviser, December 19, 2017)
Have you used this financial education resource? – Carosa,” (BenefitsPRO, December 20, 2017)
Making a 401k List and Checking it Twice,” (The 401(k) Specialist, December 20, 2017)
Measuring Retirement Readiness Key to Clients’ Workforce Management,” (PLANADVISER, December 20, 2017)
Why employers should mediate ERISA claims,” (Employee Benefit News, December 21, 2017)
Why Small Business 401k Plans Matter NOW,” (The 401(k) Specialist, December 21, 2017)
Retirement plan administrators need to look for missing participants legal alert,” (Employee Benefit Adviser, December 21, 2017)
Top 5 retirement plan providers with the toughest password requirements,” (BenefitsPRO, December 21, 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.
The new retirement: Working,” (CNBC, December 14, 2017)
The December 31 Deadline For A Clever Roth IRA Move,” (Forbes, December 14, 2017)
Why debt can be so dangerous in retirement,” (MarketWatch, December 15, 2017)
Divorce and Failing Health Amid Overlooked Retirement Roadblocks,” (PLANADVISER, December 15, 2017)
The smartest things to do with your end-of-year bonus,” (CNBC, December 15, 2017)
Robert Powell: The key to a secure retirement? Working longer,” (USA Today, December 15, 2017)
Tax Bill Could Spur More IRA Gifts To Charity,” (Forbes, December 18, 2017)
GOP tax plan makes these states a lot better for retirees,” (CNBC, December 18, 2017)
Loans, Suspended Deferrals Reduce Savings an Average of 14%,” (PLANADVISER, December 19, 2017)
Advisors usually overlook home equity for retirees,” (Financial Planning, December 20, 2017)
401k Participants Keep Calm as Markets Skyrocket,” (The 401(k) Specialist, December 20, 2017)
Forty Percent of Investors Want to Increase Retirement Plan Contributions,” (PLANADVISER, December 21, 2017)

Wisdom from Some of Our Favorite Blogs:
The Rosenbaum Law Firm P.C. Blog: Plans should get rid of those forfeitures |
Ary Rosenbaum: Plan Sponsors Need To Deal With A Whole New 401k World |
Data “Points”: ‘Making’ the Lists |
Fred Reish: Interesting Angles on the DOL’s Fiduciary Rule #74 |
Ary Rosenbaum: It Happened! Changes In The 401k Industry That Could Affect Your Plan |
Ary Rosenbaum: Whether A Plan Sponsor Should Hire An ERISA §3(16) Administrator |
Data “Points”: Are Your Retirement Savings Naughty or Nice? |

Hot Tips from Popular Web Resources:
Morningstar: The Bucket Approach to Retirement Allocation |
NAPA Net: Hill Conferees Come to Terms on Tax Reform Legislation |
NAPA Net: House Bill Seeks to Help Small Businesses Offer Retirement Plans |
NAPA Net: Excessive Fee Suit Falls Short in Court |
Kiplinger: Even Responsible Savers Make Retirement Mistakes |
NAPA Net: Are Your Retirement Savings Naughty or Nice? |
NAPA Net: Damaged ‘Goods’: Court Rejects Damage Calculations in Excessive Fee Suit |
NAPA Net: Sound Plan Management Top 2018 Priority for DC Plan Sponsors |
Kiplinger: 7 Year-End Strategies to Save You Money On Taxes |
Morningstar: Grandparents, Be Smart About Giving Money This Holiday Season |
NAPA Net: Tax Reform on the Verge of Enactment |
NAPA Net: Case of the Week: Time for Managing a Plan Merger |
NAPA Net: How Extensive is the Move from Money Market to Stable Value Funds? |
NAPA Net: How Much Do Participants’ Negative Behaviors Affect Retirement Readiness? |
NAPA Net: Tax Reform Legislation Cleared for President Trump’s Signature |
NAPA Net: And NAPA Net Readers’ Favorite Holiday Movie of 2017 Is… |
NAPA Net: A Fiduciary Carve-Out Falls Short – for Recordkeepers |
Kiplinger: Understand Retirement Income to Achieve Your Goals |
The Motley Fool: The 4 Least Tax-Friendly States for Social Security Recipients |
Morningstar: Tips for Avoiding Costly RMD Missteps |

Miss anything? Feel free to add a comment below.

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Christopher Carosa, CTFA

Christopher Carosa, CTFA

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