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Hosting an industry conference? Ask us about including it in this ticker? Trending Topics for ERISA Plan Sponsors: Week Ending 6/1/18 Trending Topics for ERISA Plan Sponsors: Week Ending 6/1/18
June 04
00:03 2018

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:
Yes, Separately Managed 401k Account Pose Risks to Plan Sponsors, But These Steps Can Reduce Their Fiduciary Liability,” (, May 30, 2018) “As more employees find their 401k accounts growing to more than one million dollars, there will be a greater desire for employees to gain greater control over their own future. Plan sponsors should become more aware of the consequences of providing these kinds of options and how best to mitigate the liability risk associated with them.”.

Compliance – Pension Madness Continues:
Are things good great or are they headed off the cliff? Only time will tell, and by then it will be too late. People, don’t depend on the kindness of strangers, control your own destiny!
Tax Reform Law Leads to $6.6B Increase in Pension Plan Contributions,” (PLANADVISER, May 29, 2018) This is a good thing.
Study: Some public pensions funds could run dry in downturn,” (CBS News, May 29, 2018) This is a bad thing.
IRS Issues How-To Guidance for Prorating Short Plan Years,” (PLANADVISER, May 31, 2018) Should they say “vertically challenged”?

Fiduciary – Look Into This:
If fiduciary must dig deep when conducting due diligence, class action attorneys are sure to dig deeper. Keep that in mind if you’re a plan sponsor.
Duty to Investigate,” (PLANADVISER, May 30, 2018) Marcia Wagner with some fiduciary advice for plan sponsors.
SEC Leaves Securities Lawyers Guessing On Meaning Of ‘Best Interest’,” (Financial Advisor, May 30, 2018) Which leaves class action attorneys licking their chops.

Fees – Squirrel!:
Sometimes the best way to deal with a problem is to act like it’s not a problem and move full speed ahead.
Penn State to Adopt Fee-Leveling Approach in Retirement Plans,” (PLANADVISER, May 30, 2018) Um, well… the cat may already be out of the bag on this one. Still, this is what the threat of lawsuits will give you.

Investments – Falling Down the Rabbit Hole:
Seriously. Read some of these stories. Is there a brewing problem here?
Industry Left Confused by DOL’s ESG ‘Clarification’,” (PLANADVISER, May 25, 2018) It’s easy. If it can impact performance, don’t do it. If it has no impact on performance, then do it to your heart’s content.
J.P. Morgan Retirement Leader Examines Sequence of Returns Risk in TDF Context,” (PLANADVISER, May 29, 2018) Interesting ideas, worthy of discussion.
Valuable lesson for 401k savers in recent market volatility: Stay the course,” (BenefitsPRO, May 30, 2018) Say what you will about target date funds, but at least they weaned plan participants from their addiction to day trading.
Can a state-sponsored 401k plan expand access to retirement savings?” (MarketWatch, May 30, 2018) This is really as state sponsored MEP 401k. The article doesn’t say how this type of MEP avoids the issue of other open MEPS, unless, by virtue of limited it to only non-profit state participants, it can be considered a closed MEP.
401k plan sponsors may need to go old school – Carosa,” (BenefitsPRO, May 30, 2018) The time may be near for plan sponsors to relearn how to vet portfolio managers.

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.
3 in 5 Americans’ Retirement Fund Falls Short,” (The 401(k) Specialist, May 24, 2018)
EBSA Wins Judgement Against Cambridge Technology Group,” (PLANADVISER, May 25, 2018)
Court Dismisses Lawsuit Over Inclusion of Former Parent Stock in Retirement Plan,” (PLANADVISER, May 29, 2018)
Twitter is outraged over this retirement advice,” (Financial Planning, May 30, 2018)
Workplace Demographics Shape a New Understanding of Retirement,” (PLANADVISER, May 30, 2018)
Integrating HSA into retirement,” (Employee Benefit Adviser, May 31, 2018)

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.
How Freelancers Can Save For Retirement—In 4 Easy Steps,” (Money, May 22, 2018)
Wait, What? Millennials Better Prepared for Retirement than Their Parents,” (The 401(k) Specialist, May 24, 2018)
Drinker Biddle: 6 Critical Questions About 401k Loans,” (The 401(k) Specialist, May 24, 2018)
The worst retirement advice I ever gave,” (Financial Planning, May 25, 2017)
If you’re young and think you can’t afford to save for retirement, try this,” (MarketWatch, May 25, 2018)
Are millennials the best retirement savers?” (BenefitsPRO, May 29, 2018)
Test Shows World Isn’t Prepared For Retirement,” (Financial Advisor, May 29, 2018)
What To Do With Your 401k Money When You Retire,” (Financial Planner, May 29, 2018)
The World Isn’t Prepared for Retirement,” (Bloomberg, May 29, 2018)
Northwestern University 403(b) Lawsuit Tossed By District Court,” (PLANADVISER, May 29, 2018)
Best retirement option: work till 70 and ‘pensionize’ 401k, IRA,” (BenefitsPRO, May 29, 2018)
More people are saving $1 million in their 401k plans. Here’s how you can too,” (CNN, May 29, 2018)
3 Critical Decisions Every Pre-Retiree Must Make,” (ThinkAdvisor, May 30, 2018)
Asian American retirement savers: Goal-focused, risk-averse, hands-on investors,” (BenefitsPRO, May 30, 2018)
Four ways retirees botch their Social Security benefits,” (CNBC, May 31, 2018)
A ‘Stealth’ Surcharge for Affluent Retirees,” (Wealth Management, May 31, 2018)
The new retirement: Gigging?” (BenefitsPRO, May 31, 2018)

Wisdom from Some of Our Favorite Blogs:
RetirementRevised: When Are You ‘Money Ahead’ on Social Security? |
Data “Points”: First-Hand Experience |
Squared Away Blog: SNL’s Kate McKinnon and Kids on Money |
The Rosenbaum Law Firm P.C. Blog: The MEP isn’t the end all, be all |
The Rosenbaum Law Firm P.C. Blog: My biggest pet peeve on networking |
The Rosenbaum Law Firm P.C. Blog: Don’t shrug your shoulders |
Fred Reish: Interesting Angles on the DOL’s Fiduciary Rule #92 |

Hot Tips from Popular Web Resources:
NAPA Net: Wildcats Win 403(b) University Excessive Fee Suit |
NAPA Net: Life’s Lessons |
NAPA Net: Bill Would Create Commission on Retirement Security |
Morningstar: Investing Insights: Retirement Spending and Hidden Gems |
The Motley Fool: Just How Valuable Are the Tax Advantages of Retirement Accounts? |
Morningstar: Strategies for Women to Bridge a Retirement Shortfall |
Kiplinger: Get Your Retirement Portfolio in Fighting Shape |
NAPA Net: Case of the Week: Rollover of Loan Offset and 402(f) Notices |
NAPA Net: Are the Regulation Best Interest and the BICE Related? |
The Motley Fool: Should I Open an IRA for My Child? |
Kiplinger: How to Defuse Your Tax Time Bomb |
Financial Advisor IQ: How a New Lease on Life Can Spell Trouble For Client Retirement Plans |
NAPA Net: Could Small Plans Duck Fiduciary Responsibility? |
NAPA Net: Younger Workers’ 401k Balances Got a Big Bump in May |
NAPA Net: ‘Repeat’ Performance: A Compounding Impact for Financial Wellness |

Miss anything? Feel free to add a comment below.

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Christopher Carosa, CTFA

Christopher Carosa, CTFA

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