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What do you think of our site upgrade? Trending Topics for ERISA Plan Sponsors: Week Ending 6/15/18 Trending Topics for ERISA Plan Sponsors: Week Ending 6/15/18
June 18
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:
Depending on Your Age, This Will Protect You from a Social Security FAIL,” (, June 12, 2018) No one need place themselves in a “Blanche DuBois Scenario.” Each has the ability, no matter their station in life, to seize control over their own destiny. This applies to retirement as much as anything else. This article offers five specific ideas each to three typical age groups trying to protect themselves against the potential loss of Social Security benefits.

Compliance – Zagging and Zigging:
Sometimes you’ve got to go against the wind to move ahead.
Social Security Uncertainty Must Inspire Concerted Action,” (PLANADVISER, June 8, 2018) Those who depend on the kindness of strangers are doomed to a life of slavery.
An Uncommon Argument Against Greater Savings,” (PLANADVISER, June 12, 2018) Very interesting ideas in this article, although they may not be as uncommon as you might think.

Fiduciary – The Moment of Truth:
We’re about to find out if all that hard work to elevate awareness of “fiduciary” really mattered at all. If the market doesn’t care, does anyone have the right to interfere. At what point does “duty” cross the line to become despotism? Does best interest become patronization? Does loyalty become tyranny?
Scottrade’s Fiduciary Infractions Violate State Law: Galvin,” (ThinkAdvisor, June 11, 2018) Anticipating a time soon coming when it can’t hang its hat on the DOL’s vacated Fiduciary Rule, Massachusetts has decided to take another approach.
SEC assigns ‘duty of loyalty’ for financial advisers,” (Employee Benefit Adviser, June 12, 2018) One. Step. Closer.
Schwab Lobbyist: SEC Right Not To Make Reg BI A Fiduciary Standard,” (Financial Advisor, June 12, 2018) Read this and you’ll get a better idea as to why fiduciary advocates don’t like the SEC proposal. In the example given, the broker is giving advice, but is not held to the same fiduciary standard registered investment advisers must abide by. The example proves (by accident) how the SEC proposal only muddies the water even more than they are today.
Can Trump make American ‘social security’ great again? – Carosa,” (BenefitsPRO, June 12, 2018) It’s amazing what the power of a well-placed Tweet can accomplish.
Opinion: ‘Fiduciary’ – an Attitude, not a Law,” (Wealth Management, June 13, 2018) The author is on point when he says the SEC and the DOL overcomplicated a straightforward concept. The headline, though, is wrong. Within the world of trust law (as opposed the regulatory regimes of the SEC and the DOL), “fiduciary” is the law.
It’s Official: The DOL Fiduciary Rule Is Dead,” (Financial Advisor, June 14, 2018) Apparently, the last deadline has now passed.
Reflections on a Dramatic Year for Retirement Plan Regulation,” (PLANADVISER, June 14, 2018) You might think mid-June an odd time to write an “annual” review, but that only means you’ve been out of school for a long time.
Merrill Lynch reviews commission IRA business after DOL fiduciary rule dies,” (On Wall Street, June 15, 2018) And with this, we’re about to see if all the hoopla was worth it. If the market permits this, then maybe it didn’t matter after all.

Fees – It’s Too Late:
If you’re waiting for the deadline, we’re already past it.
SEC 12b-1 Fee Self-Reporting Deadline Hits Tuesday,” (ThinkAdvisor, June 11, 2018) Uh, that would have been last Tuesday, but it’s a good article for those interested.

Investments – Tell Us Something We Don’t Know:
The sun rises in the east, sets in the west, and other messages from Captain Obvious.
Is ESG Investing Bunk? Yes, New Paper Finds,” (The 401(k) Specialist, June 7, 2018) No surprise here. This paper echoes what earlier research studies have shown.
What Helps or Hurts Retirement Portfolios? Here’s a Ranking,” (ThinkAdvisor, June 12, 2018) Not sure any of this makes sense. It’s just a personal opinion, not an academic analysis.
Vanguard Removes S&P 500 Fund From Its 401k,” (PLANADVISER, June 12, 2018) What kind of statement is it when the company says its most popular index fund is no longer the best proxy for the market?
Why saving is as important as investing,” (CNBC, June 12, 2018) Surprise, this is a trick question. It’s really not about investing.
Risk exposure: Does your plan still offer company stock as an investment option?” (BenefitsPRO, June 13, 2018) It’s still an issue, nearly twenty years after ENRON and even more after Color-Tile. Go figure.

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.
10 trends in retirement savings behavior: 2018,” (BenefitsPRO, June 7, 2018)
Increasing 401k Lawsuits: Causes, Consequences,” (ThinkAdvisor, June 7, 2018)
Partial Summary Judgement in Deutsche Bank Self-Dealing ERISA Suit,” (PLANADVISER, June 11, 2018)
How Well Do 401k Plan Sponsors Understand (and Prioritize) Retirement Risk?” (The 401(k) Specialist, June 11, 2018)
4th Circuit Agrees Bank of America Cash Balance Participants Are Not Due More Relief,” (PLANADVISER, June 11, 2018)
Best 401k plans by industry: Interactive infographic,” (BenefitsPRO, June 12, 2018)
Employees should contribute at least 20% to their 401k,” (Employee Benefit News, June 12, 2018)
DC Plan Loans Require Diligent Management,” (PLANADVISER, June 13, 2018)
Wrong assumptions retirement plan sponsors make,” (Employee Benefit Adviser, June 15, 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.
When Not To Retire,” (Financial Advisor, June 2018)
63% of Rich Kids Say They Will Rely on Their Inheritance for Retirement,” (Money, June 7, 2018)
Millions of Americans don’t think they will ever retire,” (Fox Business, June 7, 2018)
Should I pay off student debt before saving for retirement? Not exactly,” (MarketWatch, June 9, 2018)
Millennials Expect to Retire at Age 56,” (PLANADVISER, June 11, 2018)
Forgot to withdraw from your IRA? How to avoid that killer penalty,” (CNBC, June 11, 2018)
IRA tax strategies to use now,” (Financial Planning, June 12, 2018)
Interest Growing in HSAs as Retirement Resources,” (Wealth Management, June 12, 2018)
Your Social Security Is Worth More Than You Think,” (Forbes, June 12, 2018)
Divorce Takes a Financial Toll on People’s Retirement Outlook,” (PLANADVISER, June 13, 2018)
The world isn’t prepared for retirement, a new survey shows,” (BenefitsPRO, June 13, 2018)
Female Millennials Have 34% Less Saved Than Their Male Counterparts,” (PLANADVISER, June 13, 2018)
Closing America’s Growing Retirement Confidence Gap,” (Financial Advisor, June 13, 2018)
Myths and Realities About Spending in Retirement,” (PLANADVISER, June 13, 2018)
Most millennials expect to retire at age 56,” (Fox Business, June 13, 2018)
How this senior citizen started her own business and you can, too,” (MarketWatch, June 13, 2018)
3 key considerations for retirees taking on part-time work,” (CNBC, June 13, 2018)
2 Steps Could Help Most Clients Reach Their Retirement Goals: Morningstar,” (ThinkAdvisor, June 14, 2018)

Wisdom from Some of Our Favorite Blogs:
Ary Rosenbaum: How Plan Sponsors Can Have A Good 401k Plan After The Long Run |
Data “Points”: So, How Much Should a 35-Year-Old Have Saved? |
Fred Reish: Interesting Angles on the DOL’s Fiduciary Rule #94 |
Squared Away Blog: Luck – or a Deliberate Path to Wealth |
Fi360: Conformity is Not the End |
The Rosenbaum Law Firm P.C. Blog: That 401k Conference debuts at Citi Field |
The Rosenbaum Law Firm P.C. Blog: The Plan Sponsor may not see how great you are |
The Rosenbaum Law Firm P.C. Blog: You see how large 401k providers can treat their employees |
Business of Benefits: TCJA’s Defaulted Loan Extended Rollover Rules have a Serious Technical and Fiduciary Glitch |

Hot Tips from Popular Web Resources:
NAPA Net: 401k Excessive Fee Suit Alleges Issues with ETFs, TDFs, and Menu Size |
NAPA Net: Is Retirement Income Next on the Agenda for 401k Plans? |
NAPA Net: Oregon Treasury Delays PERS Member Investment Choice |
The Motley Fool: Social Security’s Earnings Test: How Much Money Can You Make? |
Morningstar: Retirement Planning for Singles Can Be Tough but Fun |
The Motley Fool: Fewer Parents Are Using Retirement Funds to Pay for College – Thank Goodness |
NAPA Net: How Do DC Plan Sponsors View Retirement Risks and Objectives? |
NAPA Net: (Re)Solving the Retirement ‘Crisis’ |
NAPA Net: In-Person Financial Advice is Still King, Study Suggests |
NAPA Net: NTSA Unveils ‘Best Practices for 403(b) and 457(b) Plans’ |
The Motley Fool: Want a Bigger Retirement Nest Egg? Get $24,000 More With 1 Simple Move |
NAPA Net: Better Timing and Market Conditions Led to Solid Investor Returns |
NAPA Net: Many Millennials Planning to Retire Either Early or Not at All |
NAPA Net: Standards of Care: BICE Versus Reg BI | Over 60% Of Americans Don’t Know What They Need To Retire |
The Motley Fool: Will Social Security Be Standing by the Time You Can Take It? |
NAPA Net: Is It Back to the Future for the DOL’s Fiduciary Rule? |
NAPA Net: Is a Custom Option Right for Your DC Plan? |
NAPA Net: Advisors’ Expertise Morphs as Life Expectancy Grows |
NAPA Net: Clark: Innovate, But Remember Fiduciary Duty |
The Motley Fool: How Much Tax Should I Withhold From My Pension? |
NAPA Net: READER POLL: What’s Holding Employers Back? |
NAPA Net: Factors Affecting Social Security Income Largely Misunderstood |

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Christopher Carosa, CTFA

Christopher Carosa, CTFA

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