It's All in the Design...

It's All in the Design...

For many new Plan Sponsors, and even those savvy at running company retirement plans, understanding plan design can be daunting. Industry terminology, IRS code sections, and complicated illustrations can make understanding difficult.As a retirement plan service provider, we try to ensure that your plan design is the most optimal for your group of employees. Since employee demographics can change, it’s a good idea to understand the basics and review your design from time to time.Permitted D...
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Complying with Safe Harbor Deadlines

Complying with Safe Harbor Deadlines

All 401(k) plan contributions have deposit deadlines, and it’s up to 401(k) fiduciaries to meet them. Yet, many are unclear about the deadlines applicable to their 401(k) plan. That confusion can easily lead to late contributions.Most of the confusion surrounds the deadline to deposit amounts withheld from employee wages, i.e., 401(k) pre-tax, 401(k) Roth, and/or participant loan repayments. Passed into law in 2004, the Department of Labor (DOL) set forth the rules to comply with the safe ...
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Bucket List: Retirement

Bucket List: Retirement

The economy continues at its strong pace, keeping unemployment at its lowest rate in nearly 50 years. While this is usually good news, employee financial vulnerability is clouding this sunny forecast. The repercussions are impacting their ability to save for retirement.Millennials are the most stressed by their financial situations, followed by Gen X and Baby Boomers according to PWC’s 8th annual Employee Financial Wellness Survey released in June 2019. More than 80% of the employees surve...
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Why Permitted Disparity Matters

Why Permitted Disparity Matters

When it comes to retirement plans, there are many ways to distribute a company’s profit sharing contribution. It may be as straightforward as a proportional, or “pro rata,” share to each eligible participant or it can be based on a formula that considers age or other factors.
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Protect Your 401(k)

Protect Your 401(k)

Though some employers may not think so, the truth is that in today's world 401(k) plans are subject to fraudulent activity and that the often-overlooked retirement plan can be the perfect place for it to occur. For example, in late 2017, several news outlets reported a scheme targeting individual 401(k) accounts. The U.S. Attorney's office in Colorado had filed a lawsuit to recover up to $2 million in losses due to fraudulent distributions from retirement plan accounts. The lawsuit, file...
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Automatic Enrollment is on the Rise

Automatic Enrollment is on the Rise

With the future of Social Security in question, it is becoming ever increasingly important for workers to self- prepare for post-retirement living. Studies show that approximately one out of every three eligible workers choose NOT to participate in their employer-sponsored 401(k) plan. Offering automatic enrollment in your 401(k) plan is a way for you, as Plan Sponsor, to help lend a hand to employees that are not fully aware of the significance of having a post-retirement source of revenue.Plan...
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Payroll, It’s More Than a Detail

Payroll, It’s More Than a Detail

Download The Action DocEvery retirement plan design begins with a study of a company’s payroll. It’s the essential information that drives thinking around how to optimize tax and savings potential for both business owners and their employees.Once a plan is installed, we rely on payroll data to determine eligibility, vesting, and of course, contributions. Accurate and complete data is something we assume of course, but in the real world, information is not always timely or completely ...
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Consider Behavioral Bias in Retirement Plan Design & Communications

Consider Behavioral Bias in Retirement Plan Design & Communications

As an investment professional, you may already know a great deal about how behavioral bias affects how investors make decisions and how they perceive their account performance. We know, of course, that behavioral finance tells us that many people are influenced by their emotions, their aversion to risk, their own social peer group, and sometimes by a skewed perception of control or investment skill.
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The 401(k) Turns 40

The 401(k) Turns 40

In 2018, the 401(k) plan celebrated its 40th birthday! Though extremely popular today, 401(k) plans came about almost by accident. IRC Section 401(k) was passed into law as part of the Revenue Act of 1978 and was included to limit executive compensation. However, in 1980, Ted Benna of the Johnson Companies used the provision to create and get IRS approval of the first 401(k) plan for his company. For this he is often referred to as the father of the 401(k).At its inception, employees could contr...
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Know Your Options

Know Your Options

If your plan offers a Roth 401(k) provision, your participants might ask, “Which one is better for me?” As the availability of Roth options in 401(k) plans and Roth contribution percentages continue to rise, it’s important to be able to guide participants in making the right choice.401(k) plans offer many advantages to participants; the ability for accounts to grow on a tax-deferred basis, the chance of receiving employer contributions in the form of a match or non-elective con...
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