BPP401k.com Newsletter Benefit Plans Plus 4_1

BPP401k.com Newsletter
April 1, 2009

News Highlights

Why You're Making Dumb 401(k) Choices Five common mistakes that drain money from retirement accounts.

The Lost Souls of 403(b) and the 2009 Form 5500 How do you count former employees for purposes of the 2009 Form 5500, which 403(b) plans will need to file in toto for the first time.

Market Collapse Places Fiduciaries at Risk Beware all who would enter here: the land of the retirement plan fiduciary is not for the weak or faint of heart, or those with a queasy stomach.

Watch Out for Top-Heavy In terminating, freezing or reducing the contributions in a safe harbor 401k plan, an employer must take into account the possibility of incurring a top-heavy minimum contribution which might equal or exceed the safe harbor contribution that the employer is eliminating.

Celebrate National Employee Benefits Day on Thursday, April 2 Check out our retirement calculators

401k Plan Sponsors Not Making Changes During Economic Downturn - Summary: According to a recent survey of 401k plan sponsors, approximately three-fifths of respondents stated that the recent financial crisis had not made any changes to their companies' 401k plans. This is a summary of the results. Located at: CCH. Click on headline for full article.

Third of Sponsors in Poll Dropped, Reduced DC Match - Summary: A Spectrem Group news release about its "Plan Sponsor Attitudes at the End of a Tumultuous Year" report said 34% of the February 2009 online poll of 150 plan sponsors had taken steps to change their match policies. Located at: Plansponsor.com (free registration may be required). Click on headline for full article.

Adding Low Wage Employee and Top-Heavy Status - Summary: Looking at the question, "Does adding a low wage hourly employee as a 401k plan participant help to alleviate a 'top-heavy' problem?" Located at: Benefitslink.com. Click on headline for full article.

Watch Out for Top-Heavy - Summary: In terminating, freezing or reducing the contributions in a safe harbor 401k plan, an employer must take into account the possibility of incurring a top-heavy minimum contribution which might equal or exceed the safe harbor contribution that the employer is eliminating. Located at: Sungard/Relius. Click on headline for full article.

A Waiver Is Not a QDRO - Summary: The Supreme Court's decision in Kennedy v. Plan Administrator for DuPont Savings and Investment Plan reinforced two principles of ERISA important for participants and beneficiaries and for plan administrators. Located at: Chang, Ruthenberg & Long PC. Click on headline for full article.

GOP Congressmen Offer Savings Proposal - Summary: A group of Republican Congressmen have proposed a plan they say offers a shot in the arm for American savings. Located at: Planadviser.com. Click on headline for full article.

House Reviews Advice Given to 401k, IRA Holders - Summary: Members of a congressional panel said they wanted to ensure that retirement account holders have access to unbiased invest. advice, an issue that's all the more important since stock market declines drained billions from retirement savings. Located at: New York Times. Click on headline for full article.

Market Collapse Places Fiduciaries at Risk - Summary: Beware all who would enter here: the land of the retirement plan fiduciary is not for the weak or faint of heart, or those with a queasy stomach. This article is designed to provide a survey of fiduciary exposure issues in two parts. The first will explore recent trends in fiduciary litigation, and the second will look at some of the pertinent changes in the law and how employers are coping with them. Located at: Holland & Hart LLP (PDF File). Click on headline for full article.

The Lost Souls of 403(b) and the 2009 Form 5500 - Summary: Discusses the question of the counting of former employees for purposes of the 2009 Form 5500, which 403(b) plans will need to file in toto for the first time. Located at: Business of Benefits Blog. Click on headline for full article.

Implications of a Bear Market for Retirement Security - Summary: This paper examines several hypothetical scenarios over the past 138 years in which investors would have faced historically poor markets. Shows impact of a significant market decline on a retiree who followed a "life-cycle" approach to investing. Also shows that if investors focus on areas that they can control, they can measurably improve their long-term prospects for weathering such negative environments. Located at: Vanguard Investment Counseling & Research (PDF File). Click on headline for full article.

Conflicts of Interest Can Affect Defined Benefit and Defined Contribution Plans - Summary: Testimony before the Subcommittee on Health, Employment, Labor and Pensions, Education and Labor Committee, House of Representatives by the US Government Accountability Office on conflicts of interest that can affect both DB and DC plans. Located at: US Government Accountability Office (PDF File). Click on headline for full article.

Labor Department 401k Rules May Create Conflicts - Summary: Labor Department rules allowing retirement plan administrators to offer specific invest. advice may create a conflict of interest, House Democrats said at a hearing Tuesday. Located at: Bloomberg.com. Click on headline for full article.

DOL Delays Final Invest. Advice Regulations - Summary: The DOL's notice does not offer any clues as to what changes, if any, might follow from its legal and policy review, so plan sponsors and others will simply have to wait and see what the DOL decides. Located at: Employee Benefits Institute of America. Click on headline for full article.

New Rules on Retirement Advice Get Mixed Reviews - Summary: As American workers' retirement assets continue to be devoured by the bear market, the government is reconsidering how best to make invest. advice available to retirement plan participants. Located at: Financial-planning.com. Click on headline for full article.

5500 Schedule C Reporting Delay and Additional Guidance Needed - Summary: A substantial majority of retirement plan service providers are unsure about how to comply with the new Form 5500 Schedule C reporting requirements, according to a recent survey. Located at: 401khelpcenter.com. Click on headline for full article.

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