February 2007
401(k) Newsletter
General Issues
New Developments for Automatically Enrolled Plans
— Summary: Numerous studies have shown that not enough workers are saving for retirement-and of those that do, they often do not save enough. To combat employee inertia, the Pension Protection Act of 2006 made significant changes and article highlights and comments on the key features of the new automatic enrollment provisions. Located at: Reish Luftman Reicher & Cohen (PDF File). Click on headline for full article.
2007 Crystal Ball - A Blinding Flash of the Obvious — Summary: Jeb Graham looks at some hot topics and key questions in the world of retirement plan investment oversight for 2007. Located at: 401khelpcenter.com. Click on headline for full article.
Flipping the Switch: Tips for Moving From DB to DC — Summary: The trend toward DC is clear and well-known. In recent years, employers increasingly have been dropping or freezing their pensions and switching to a 401k. Two employers and a consultant shared their experiences and what they learned in this process. Located at: Benefitnews.com. Click on headline for full article.
Six Paths to Retirement — Summary: The conventional view of retirement—working full-time until a set date and then shifting to full-time leisure—does not match the experience of many older Americans. This study explores the transition from the world of work to the world of retirement. Using actual work histories, the study identifies six distinct paths from work to retirement and examines the triggers that influence these paths. Located at: Vanguard Center for Retirement Research (PDF File). Click on headline for full article.
401k Plans in the Multiemployer Environment — Summary: This article briefly reviews the legal structure of multiemployer 401k plans, including the impact of the PPA. Types of contributions, tax code limits, investments, loans and hardship distributions are discussed. Located at: International Foundation of Employee Benefit Plans (PDF File). Click on headline for full article.
PSCA Releases Eligibility Mini-Survey — Summary: PSCA has collected eligibility data annually since 1998, and has noticed a general trend towards shorter eligibility periods for all plan types. This is the data from their most recent survey. Located at: Profit Sharing/401k Council of America (PDF File). Click on headline for full article.
Fiduciary Issues
Online Year 2007 ERISA Reporting Calendars — Summary: Wyatt's 2007 ERISA Reporting Calendars are now available online! Plan administrators of single and multiemployer pension and welfare benefit plans can visit our web site for concise information on filing annual and special reports with the DOL, IRS and PBGC. Located at: Watson Wyatt Worldwide. Click on headline for full article.
The Fiduciary Duty to Get Help — Summary: The DOL, as well as a number of courts, has taken the position that fiduciaries that are not qualified to fulfill their duties are required to seek assistance from competent sources. However, as with investments (and any other fiduciary decisions), fiduciaries are required to engage in prudent processes for selecting and monitoring their advisers. Located at: Plansponsor.com (free registration may be required). Click on headline for full article.
DOL and IRS Issues
401k Resource Guide — General Distribution Rules — Summary: To help plan sponsors understand 401k plan distributions better, the IRS has just made available a this basic resource guide. Located at: IRS. Click on headline for full article.
DOL Issues Good Faith Compliance Guidelines for Individual Benefit Statements — Summary: Under the PPA, a private sector plan administrator is now obligated, for plan years beginning after December 31, 2006, to furnish pension benefit statements. This is a review of what those statements must be furnished. Located at: Ice Miller LLP. Click on headline for full article.
IRS Issues "Grab-Bag" of Guidance on PPA Distribution Issues — Summary: The IRS released Notice 2007-7 on January 10, 2007 featuring guidance generally related to distribution issues presented by the Pension Protection Act of 2006. Here, we focus on some of the issues affected by the notice. Located at: CCA Strategies. Click on headline for full article.
IRS Devotes Web Page to PPA — Summary: The Internal Revenue Service has devoted a Web page to information relating to the Pension Protection Act of 2006 (PPA), including links to a chart of PPA provisions, published guidance on certain provisions, and newsletter articles. Located at: IRS. Click on headline for full article.
Headlines
