Tag: Employee Benefit Plans

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Employee Benefit Plan Newsletter – March 2016

Our last two newsletters featured articles about two common “auto” features used by defined contribution (DC) plans to improve participation and savings rates. Numerous studies have documented the positive impact these features have had. Beyond such auto features, there are a number of other practices that should be explored to help drive successful retirement outcomes. A plan’s approach to employer contributions, for instance, can be designed to maximize the employee’s contributions. Turn to Page 3 for a discussion of how this could be accomplished.

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How to Help Increase Your Participants’ Retirement Savings: Auto Escalation

Numerous studies have found that in order to accrue adequate money to achieve a secure retirement, the average plan participant needs to contribute between 10–15% of their annual salary. Considering that default contribution rates for plans utilizing automatic enrollment are generally in the 3% to 6% range, it is a marked gap, and one that plan sponsors can help remedy.

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Employee Benefit Plan Newsletter – January 2016

Over the past thirty-plus years, defined contribution (DC) plans have become the primary means for the average worker to accumulate wealth to provide for a financially secure retirement. With longer life expectancies and increased health care costs, it is more important than ever for employees to adequately save for retirement. Accordingly, it is crucial that employees effectively utilize DC plans to achieve this objective. Unfortunately, several surveys and studies have concluded that this may not be happening.

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New EBSA Report Finds Deficiencies in Audit Quality

According to a U.S. Department of Labor Employee Benefits Security Administration (EBSA) Report issued May 2015, 39% of 400 audits reviewed by EBSA contained major deficiencies. This latest report indicates that the quality of employee benefit plan audits has not improved, but has, in fact, been worsening over previous studies.

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Recent Supreme Court Ruling Puts Onus on Employee Benefit Plan Sponsors…

A ruling by the Supreme Court in the case Tibble vs. Edison International last month makes it clear that plan sponsors have an ongoing fiduciary duty to monitor the investments in 401(k) plans. Although the Supreme Court decision was narrowly focused on the statute of limitations issue, there are broader implications that plan sponsors will need to consider.

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Increase Participation Rates in Your Plan: Auto Enrollment

Automatic enrollment features have proven to be an effective means of increasing plan participation. In addition to helping to improve participant outcomes, the increased participation can help plans comply with the non-discrimination requirements.

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