The Rosenbaum Law Firm P.C. Blog

On August 3, 2002, the Internal Revenue Service (IRS) issued Notice 2022-33 which extended the amendment deadline for plans for the SECURE Act, the Miners Act, and the CARES Act. Prior to this Notice, amendments for all provisions of the Acts were due by the last day of the plan year beginning on or after January 1, 2022 (December 31, 2022, for calendar year plans).

Under the Notice, amendments for all provisions of the SECURE Act are now due no later than December 31, 2025.

For the CARES Act, the December 31, 2025, extended deadline only applies to the 2020 required minimum distribution waiver for defined contributions and IRAs. Amendments for other provisions of the CARES Act, such as optional COVID distributions and loans, must still be adopted by the last day of the plan year beginning on or after January 1, 2022.

In a move that shouldn’t surprise anyone, Empower announced the end of the Great-West brand in order to “strengthen and simplify” how the organization connects with customers.

Great-West came to Denver in the 1970s. Empower was created in 2014 through a three-part merger of the retirement companies of Great-West Financial, Putnam Investments, and J.P. Morgan Retirement Plan Services. So with a national presence and an increase in size using the Empower name, it’s no shock that Great-West’s name will be eliminated.

I have always had a problem with target date funds (TDFs). It had to do with glide paths and the fact that there was no uniformity as it pertained to what should be in a 2025 fund or any fund for that matter.

The Morningstar Center for Retirement & Policy Studies found that target-date fund plan sponsors may expose individual investors to increased risk by not tailoring plan glide paths to their behavior.

The center reports that 58% of defined-contribution plan assets are invested in off-the-shelf TDFs, many of which are designed for participants to stay in the plan through their retirement, even when they are likely to roll their money out of the plan at retirement.

While TDFs are a great idea, there are just too many issues that still remain.

As a crypto investor who is trying to drive down my average cost through dollar cost averaging, the increase in Bitcoin’s price of late, has helped. On the downside, it will increase the interest as an investment in the 401(k) space. I’d love Bitcoin to be back around $69,000 because I’ve been driving down my average by buying it at $18-20,000. That being said until there are some regulations on Bitcoin and a lot less volatility, I still think it was a bad idea before the Department of Labor said it was a bad idea.

Ascensus announced that Kasey Price, Ascensus’ head of Sales, will assume the role of President of FuturePlan by Ascensus on Aug. 1, 2022.

Price was a founding partner and CEO of Georgia-based Retirement Strategies, Inc. (RSI), a third-party administrator before it was bought by Asecnsus in 2017.

My latest article on JDSupra.com can be found here.

My latest newsletter can be found here.

My latest article on JDSupra.com can be found here.

Having been in the retirement plan business for the last 24 years, I have learned something new almost every day and I’ve seen a lot of things that I could never believe I would see when I was an L.LM student learning about the qualified plan.

Having survived 9 years as an attorney for third-party administration firms and 3 years as a law firm attorney, you learn how to do business and how not to do business.

The most important value that I believe a retirement plan provider should have is honesty. You don’t have to be the best, the smartest, the hardest working, or the best value. You need to be honest because honesty maintains the trust that your clients have in you and if you are caught lying, then you have betrayed that trust and then you lose the client. The most important asset that you have in the retirement business is your reputation because providers with poor reputations don’t do as well as those that have good reputations. Honesty only enhances your reputation, it will never besmirch it.

Honesty is not just about being honest about fees, it’s about being honest with mistakes you make and forthcoming with any changes that the plan sponsor needs to make to improve their plan and limit their liability. Sometimes that honesty will cost you business; especially an actuary who tells the plan sponsor that it’s time to terminate their defined benefit plan and the actuary will lose that client. At the end of the day, the client’s needs do have to come first.

I have seen retirement providers of all sorts (TPAs, financial advisors, attorneys, and auditors) do wrong to their clients by being dishonest and less forthcoming with their clients. I never wanted to take that road because my fear is that the client would find out that I did wrong and I never want to betray my client’s trust.

With fee transparency and so many tools out there to gauge a provider’s work, the incentive to be dishonest is being minimized.

As a retirement professional, your word is your bond with your client. Without that bond, then you will not have that client or a good reputation in the industry.

Having been in the retirement plan business for the last 24 years, I have learned something new almost every day and I’ve seen a lot of things that I could never believe I would see when I was an L.LM student learning about the qualified plan.

Having survived 9 years as an attorney for third-party administration firms and 3 years as a law firm attorney, you learn how to do business and how not to do business.

The most important value that I believe a retirement plan provider should have is honesty. You don’t have to be the best, the smartest, the hardest working, or the best value. You need to be honest because honesty maintains the trust that your clients have in you and if you are caught lying, then you have betrayed that trust and then you lose the client. The most important asset that you have in the retirement business is your reputation because providers with poor reputations don’t do as well as those that have good reputations. Honesty only enhances your reputation, it will never besmirch it.

Honesty is not just about being honest about fees, it’s about being honest with mistakes you make and forthcoming with any changes that the plan sponsor needs to make to improve their plan and limit their liability. Sometimes that honesty will cost you business; especially an actuary who tells the plan sponsor that it’s time to terminate their defined benefit plan and the actuary will lose that client. At the end of the day, the client’s needs do have to come first.

I have seen retirement providers of all sorts (TPAs, financial advisors, attorneys, and auditors) do wrong to their clients by being dishonest and less forthcoming with their clients. I never wanted to take that road because my fear is that the client would find out that I did wrong and I never want to betray my client’s trust.

With fee transparency and so many tools out there to gauge a provider’s work, the incentive to be dishonest is being minimized.

As a retirement professional, your word is your bond with your client. Without that bond, then you will not have that client or a good reputation in the industry.