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What do you think of our site upgrade? Trending Topics for ERISA Plan Sponsors: Week Ending 3/22/19 Trending Topics for ERISA Plan Sponsors: Week Ending 3/22/19
March 25
00:02 2019

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: Roger Levy Says 401k Fiduciary Advisers Should Heed Results of Putnam Case,” (, March 19, 2019) “The ruling by the First Circuit in the Putnam case further increases focus on trust law when determining the scope of fiduciary responsibility under ERISA. Prudent practice already draws on trust law and sometimes prudent practice is ahead of the courts.”

Compliance – Moving Government Workers into the (Late) 20th Century:
A lot more catching up is required.
Trump Wants 401ks for Federal Workers,” (401K Specialist, March 18, 2019) This might just level the playing field.

Fiduciary – This Could Get Interesting:
As surveys show people know nothing of their investment provider business model risk exposure, state regulators may just be opening a Pandora’s box on the entire subject.
Nevada Fiduciary Rule Would Scare Off Morgan Stanley, TD Ameritrade,” (ThinkAdvisor, March 18, 2019) Because free tools providing generic education would be considered “investment advice.”
SEC Using ‘Best Interest’ as a ‘Marketing Slogan’: Phyllis Borzi,” (ThinkAdvisor, March 18, 2019) What she said.
Half of Americans Believe All Advisers Must Act in Their Best Interest,” (PLANADVISER, March 19, 2019) That’s all fine and good, since by law all Registered Investment Advisers have a fiduciary duty to always act in their client’s best interest. More telling, however, is this: most Americans don’t know if they’re working with a Registered Investment Adviser or a broker advisor, the latter not currently being legally required to act in their client’s best interest.
ESG investing in 401k plans faces fiduciary, regulatory questions,” (BenefitsPRO, March 19, 2019) Hmm, incredible feeling of déjà vu… wait! Here it is: “When Does “Socially Responsible” Investing Violate Fiduciary Duty?, May 23, 2017).
Fiduciaries shouldn’t underestimate trust law roots – Carosa,” (BenefitsPRO, March 20, 2019) The concept of “fiduciary” goes back several centuries and most famously rose to such a level that it may have birthed the Magna Carta.
Morgan Stanley, Schwab, TD, Wells Fargo threaten to pull services if Nevada sets fiduciary duty,” (On Wall Street, March 20, 2019) This has major backfire potential. By pulling out, but continuing to serve clients electronically through the internet, it could make “fiduciary” an interstate commerce issue, which puts it squarely back into the lap of the federal government.
Washington State May Create a Public Retirement Savings Program,” (ThinkAdvisor, March 21, 2019) Yep, add another log to the fire.

Fees – Monkey See, Monkey Do:
What’s this about “piling on” that you don’t know about?
Another Undisclosed Fee Lawsuit Filed Against Fidelity,” (PLANADVISER, March 20, 2019) Is this going to be a drip, drip, drip…?

Investments – You Can Feel the Tension:
What’s it going to be? Is a bear looming? Will active play the familiar role of controlling downside risk? And what about Naomi?
The Coming Bear Market Will Be Especially Painful For The Boomers,” (Forbes, March 14, 2019) At least for those who haven’t saved enough or are spending too much in retirement.
Active TDFs May Help With Market Volatility, Sequence Risk,” (PLANADVISER, March 15, 2019) This is probably true for many types of actively managed funds.
7 Steps to a Well-Constructed Investment Policy Statement,” (401K Specialist, March 19, 2019) Good, generic rules.
Passive investing now controls nearly half the US stock market,” (CNBC, March 19, 2019) Bogle said it couldn’t happened, and yet…

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.
Using Behavioral Finance to Boost Retirement Security,” (PLANADVISER, March 15, 2019)
Plaintiffs File Brief in Opposition of Supreme Court Review of Putnam Case,” (PLANADVISER, March 18, 2019)
Medium and Large Plans Drive Peak Pension Risk Transfer Sales in 2018,” (PLANADVISER, March 19, 2019)
New DCIIA Report Aims to Help DC Plan Sponsors With Custom TDF Discussions,” (PLANADVISER, March 20, 2019)
When natural disasters and emergencies strike: Retirement plans & hardship distributions,” (BenefitsPRO, March 20, 2019)
2018 Largest Asset Allocation De-Risking Year for DB Plans Since 2011,” (PLANADVISER, March 20, 2019)
No decline in appetite for transferring corporate pension risk,” (BenefitsPRO, March 20, 2019)
Advisers Can Help Start-Up Retirement Plans Evolve,” (PLANADVISER, March 21, 2019)

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.
Here’s how many Americans aren’t saving any money for retirement,” (CNBC, March 14, 2019)
People need to use their home equity in retirement,” (MarketWatch, March 14, 2019)
Parents helping kids financially at cost of retirement,” (BenefitsPRO, March 15, 2019)
How to handle an inherited IRA,” (MarketWatch, March 16, 2019)
Individuals Concerned About Impact of RMDs on Taxes,” (PLANADVISER, March 18, 2019)
Risk to 401k Participants: 2 in 3 Bankruptcies Due to Medical Bills,” (401K Specialist, March 18, 2019)
Advisors’ Advice: 11 Financial Mistakes Retirees Make,” (ThinkAdvisor, March 19, 2019)
Good News for Retirement Investors,” (US News, March 19, 2019)
Debunking 10 Common Misconceptions About Retirement,” (Financial Advisor, March 20, 2019)
Women Need Help Planning for Family Financial and Retirement Goals,” (PLANADVISER, March 20, 2019)
Retiring Soon? It’s Time to Spring Clean Your Finances,” (TheStreet, March 20, 2019)
The right retirement formula is based on the value of your home,” (MarketWatch, March 20, 2019)
Unplanned Early Retirement Should Be Considered In Financial Plans,” (Financial Advisor, March 21, 2019)
New Tool Helps Retirement Savers Change Their Behavior,” (ThinkAdvisor, March 21, 2019)
Wanted: Near-Retirement Strategies,” (Wealth Management, March 21, 2019)
Fixing The 4 Percent Rule For Retirement Withdrawals In Any Market Environment,” (Financial Advisor, March 22, 2019)

Wisdom from Some of Our Favorite Blogs:
Ary Rosenbaum: Important Tasks That Many 401k Plan Sponsors Ignore |
Squared Away Blog: Boomers Cope with Real Financial Pain |
The Rosenbaum Law Firm P.C. Blog: Courts these days want to see something more |
The Rosenbaum Law Firm P.C. Blog: Roll them out |
The Rosenbaum Law Firm P.C. Blog: Never lose sight that a 401k plan can recruit or retain employees |
The Rosenbaum Law Firm P.C. Blog: Ratings won’t last forever |
The Rosenbaum Law Firm P.C. Blog: When you have to cut a retirement plan provider client off |
Squared Away Blog: Men Who Work Longer, Live Longer |
Ary Rosenbaum: Reasons Why You Should Sponsor A 401k Plan |

Hot Tips from Popular Web Resources:
National Association of Plan Advisors: Managed Accounts Viewed as Area of Opportunity in DC Market |
National Association of Plan Advisors: Self-Directed 401k Investors Withstand Blow from 4th Quarter Volatility |
Morningstar: Is It Ever a Good Idea to Hold Company Stock in a 401k? |
National Association of Plan Advisors: What’s Holding ESG Adoption Back in the 401k Market? |
National Association of Plan Advisors: Environmental Impasse? |
National Association of Plan Advisors: Global Institutional Investors Seeking New Sources of Alpha |
National Association of Plan Advisors: What Could the Advent of Open MEPs Spell? |
The Motley Fool: More Than a Third of Baby Boomers Are Making This Big Retirement Mistake |
Kiplinger: Social Security Timing Is Part of Larger Plan |
National Association of Plan Advisors: Fidelity Served With 2nd FundsNetwork Suit |
National Association of Plan Advisors: ‘Suitability’ versus ‘Best Interest’ Still Commonly Misunderstood by Investors |
National Association of Plan Advisors: Fearful of Retirement Insecurity, Americans See Government Playing Key Role |
National Association of Plan Advisors: Health Care Cited as Top Hurdle to Early Retirement |
National Association of Plan Advisors: Social Insecurity – Up Close and (Too) Personal? |
National Association of Plan Advisors: Study Reveals Sweeping Allocation Strategies for Custom TDFs |
National Association of Plan Advisors: A Federal Case |
National Association of Plan Advisors: Happy Fiduciary Awareness Day |
National Association of Plan Advisors: Small 401k Plan Contribution, Eligibility Practices Profiled |
The Motley Fool: What to Know About Social Security If You Outlive Your Spouse |
National Association of Plan Advisors: FINRA to Hold the Line on Member Fees |
National Association of Plan Advisors: Here’s Why Financial Advisors Should Not Overlook Generation X |
National Association of Plan Advisors: The Next Financial Services Disruptor Is… |

Miss anything? Feel free to add a comment below.

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Christopher Carosa, CTFA

Christopher Carosa, CTFA

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