Thereâs a perverse incentive working here, however. The more aggressive a plan sponsor gets in terms of promoting âfinancial wellness,â the more likely that plan sponsor will accidentally cross some compliance line.
Tag "retirement"
Thereâs not a sin in listening to radio shows sponsored by those selling gold and silver. Itâs quite another thing to actually act on their ârecommendation.â
But that idea contained a flaw. In the early years, limited choices made it easy for employees. The proliferation of the number of options in later years, however, exposed the lack of sophistication within the employee cohort. That can lead to bad decision-making. Alternative solutions were needed.
How do we design and administer retirement plans?
Iâm old enough to remember a world before the 401k. So distant was this anomaly in the tax code, that I, like nearly everyone else, was unaware of its existence, let alone its significance when it was formulated in 1978. What makes this more ironic was that it was my Congressman, Barber Conable, that led the way.
Itâs not just plan sponsors and plan participants that need convincing. The entire retirement plan infrastructure must also get on board. That doesnât mean the hurdles canât be overcome.
The decision to retain and service company retirees appears (at first blush at least) to be a no-brainer. But that includes a very important assumption.
If you think the web of fiduciary duties is complex in a 401k plan that focuses on getting employees to save for retirement, imagine how much more intricate it becomes if the plan also has to cater to retired employees.
While diligence is to be applauded, thatâs not to say you canât carry it to an extreme. If fact, some folks are so hung up on fees, they sometimes fail to see the bigger picture.
The Biggest 401k Fiduciary Fireworks, Fizzles, And Flops In 2021
Flops may not be forever. They may just be good ideas before their time. If youâre going to belittle them, you best hurry, because, if you wait too long, you may just discover they arenât flops anymore. As a result, letâs not waste any time before the shelf-life of these flops expire.