The Rosenbaum Law Firm P.C. Blog

I once said that I thought I lived in a great community until I joined the Facebook community newsgroups. You just can’t imagine what people think. The same can be said about some of these polls of plan participants, which shows that we still are failing at the job of explaining plan costs.

An AARP survey found that over 70 percent of plan participants thought that they weren’t paying any fees at all. I’m sure a lot of plan sponsors still think their administration is free. Despite fee disclosures and the industry is far more transparent, there is still an issue that people think they’re getting free 401(k) administration.

FuturePlan by Ascensus, and Voya Financial are introducing a new Employer Aggregated Plan, called FuturePlan EAP.

This solution which is an aggregated plan, instead of a Pooled Employer Plan will offer employers the ability to ease administrative burdens and limit fiduciary risk while providing retirement plan access to more savers. Voya—will serve as recordkeeper, FuturePlan will be the Third Party Administrator and 3(16) service provider, and LeafHouse will provide 3(38) services.

A class action lawsuit brought by former SeaWorld employees that alleged participants in the SWBG LLC 401(k) plan were harmed will continue.

The former employees’ arguments sustained the fiduciary breach of the duty of prudence allegations, count one, and the second charge, a related count, for the breach of the duty to monitor plan investments and covered service providers.

The former employees allege harm to their retirement investments because of high-cost, underperforming investments in the plan when lower-cost options were available. The former employees also allege the plan paid excessive administrative and recordkeeping fees and imprudently selected and retained actively managed target-date funds from American Century.

The judge did grant part of the SeaWorld defendants’ motions to dismiss the amended complaint, including the motion by Alliant Insurance Services, which served as a fiduciary consultant to the plan and provided financial advice and assistance with fiduciary oversight responsibilities.

I’ve been long in this business to remember no participant websites, so I’m amazed by technological breakthroughs. Artificial Intelligence (AI) tools

BenchMine is billed as the first-ever AI 401(k) comparative analysis tool that’s free and open to the public.

Plan advisors can now search through more than 56,000 plans with at least $1 million in total assets nationwide to see how particular company 401(k) plans stack up in their area, against a competitor, or within a specific industry. The tool will allow them to show plan sponsors where the plan excels and/or falls short in terms of average fees, contributions, and performance. The tool draws on Department of Labor 401(k) data from companies that filed a Form 5500 Schedule H for 2021.

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

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

19 states, led by Florida’s Republican Governor Ron DeSantis, signed an open letter declaring their opposition to the use of environmental, social, and governance factors (ESG) in government investing and outlined legislative priorities to that effect.

In addition to Florida, the coalition includes Alabama, Alaska, Arkansas, Georgia, Idaho, Iowa, Mississippi, Missouri, Montana, Nebraska, New Hampshire, North Dakota, Oklahoma, South Dakota, Tennessee, Utah, West Virginia, and Wyoming.

The joint statement read that “The proliferation of ESG throughout America is a direct threat to the American economy, individual economic freedom, and our way of life, putting investment decisions in the hands of the woke mob to bypass the ballot box and inject political ideology into investment decisions, corporate governance, and the everyday economy.”

The letter claims the Department of Labor’s recent final rule permitting the use of ESG factors when selecting retirement plan investments will cost Americans money by prioritizing a political agenda over maximum return.

With DeSantis running for President, this is just politics. I think in the end, most plan sponsors aren’t going to be using ESG funds and the coalition is just using this opposition for political gain against the Biden White House.

New Vanguard data shows that 72% of plan sponsors allowed for immediate eligibility of retirement saving deferrals in 2021, which is an increase over the 58% in 2012, according to own research.

Although not every Vanguard plan permits immediate eligibility for employee deferrals, 86% of plans allow for entry within three months of employment, according to the data.

With a tight labor market, I think immediate eligibility is a great recruitment tool. I was an employee once too and eligibility requirements for deferrals that were more than 3 months were a big minus.

One Digital announced it has acquired 401K Resources and The Clear Group

401K Resources was founded by Renee Scherzer, the President-Elect of the National Association of Plan Advisors (NAPA).

The Clear Group, founded by Renee’s husband Chris, provides employee benefits solutions, retirement planning, human resources consulting, and personal and business property and casualty solutions.

If your Department of Labor (DOL) proposes a rule, as President, you’re not likely to throw them under the bus and overrule them.

In a move that surprised no one, President Joe Biden used his first veto to preserve a recent DOL rule about investment choice in 401(k) and other workplace retirement plans.

The Biden administration rule paved the way to overturn the previous rule that barred employers from selecting environmental, social, and governance (ESG) funds for their company 401(k) plans, experts said.