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2017
Aug 04

Correcting 401(k) Plan Loan Failures Voluntarily

Participant loans are a feature of many 401(k) Plans. Participants may borrow the lesser of $50,000 or 50% of the participant’s vested plan assets. Some 401(k) Plans allow a participant to have multiple loans outstanding at one time. In that scenario, the $50,000 limit is lowered by the highest outstanding loan balance during the one-year period ending on the day before the newest loan.

2017
Jul 12

How to Handle Hardship Withdrawals

Many 401(k) plans feature a hardship withdrawal option. Both the IRS and DOL maintain strict regulations around these provisions. This article discusses how, in early 2017, the IRS issued updated audit guidelines regarding requirements for hardship withdrawals and guidance for plan sponsors on how to remedy errors in the administration of these withdrawals.

2017
Jun 06

Avoid Litigation with Attention to Common ‘Red Flags’

Any size retirement plan can run into serious trouble when sponsors are not careful. With some planning, however, a qualified retirement plan can avoid ERISA litigation. This article reviews some of the most common red flags leading to litigation and reminds plan sponsors of the importance of regularly reviewing fees and expenses.

2017
May 05

Helping Soon-to-Be Retirees Understand RMD Rules

Employees who are approaching retirement age may be unaware of their required minimum distribution (RMD) obligations, which begin at age 70½ for both individual IRAs and 401(k)s. This article summarizes what they need to know for financial and tax-planning purposes.

2017
Apr 04

Be Prepared for Your Next — or First — QDRO

In the settlement of divorce cases, it is frequent to have the courts order that a portion of one spouse’s pension benefits be assigned to the other (soon to be former) spouse. However, it is up to the plan sponsor or administrator to determine whether the order qualifies as a Qualified Domestic Relations Order (QDRO). This article discusses common errors that plan sponsors encounter when qualifying a domestic relations order and how to handle the rejection of an order.

2017
Mar 07

Fiduciary Duties: Reviewing & Benchmarking Plan Fees

Are the services a plan receives reasonably priced? Knowing the answer is a vital fiduciary duty. ERISA expects more from plan fiduciaries than simply shopping around for plan providers offering rock bottom rates. This article summarizes some key areas all fiduciaries must consider when benchmarking costs of their qualified retirement plan. A sidebar discusses a report that suggests ways employers can help current plan participants ease into retirement.

2017
Feb 07

Understand Your Target-Date Fund Series

Target-date or lifecycle funds first came to market in 1994. Since then, they have experienced much growth with nearly every large financial institution today offering their own version of these funds. Along with target-date funds becoming a fundamental option of 401(k) plans, comes a fiduciary responsibility to monitor and evaluate them, much like other plan investments. This article examines key characteristics plan sponsors and investment committees should know about target-date funds.

2017
Jan 03

Do You Know Where All of Your Plan Participants Are?

It is not uncommon for previously active employed plan participants to fall off the radar screen. They include retirees and former employees that move away without informing the plan administrator. Before anyone realizes it, they become “lost” participants. This article details the steps to take when dealing with these participants.

2016
Dec 06

Auto-Escalation Should be Offered in Conjunction with Auto-Enrollment

Auto-enrolling 401(k) plan participants without also incorporating an auto-escalation feature might be a counterproductive exercise. Survey data suggests that average 401(k) plan deferral rates have been trending downward even though more employers are adopting auto-enrollment. The apparent culprit: low auto-deferral rates. This brief article highlights how to use both auto-enrollment and auto-escalation clauses to help benefit employees.

2016
Nov 07

Let’s Play Ball! It’s Time to Step Up to the Plate to Review Fiduciary Status and Fiduciary Duties

Are you a fiduciary for your company or organization’s retirement plan? If yes, you may find it challenging to “cover all the bases” in understanding your fiduciary duties. Some common duties that get overlooked include failing to identify the plan’s fiduciaries and insufficiently training fiduciaries on their responsibilities.

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