Participant education is one of the most neglected aspects of a 401k plan. The goal for a successful plan should be the same for the sponsors and the participants; to reach retirement with the accumulated assets they need. Studies have shown that nearly one in four eligible employees do not contribute to their company’s 401k plan. Studies also show that even actively participating employees often have contribution rates and investment allocations inconsistent with their long term goals. See 401k Education Program
October Retirement Report
BRI’s annual Retirement Confidence Survey shows need for action now. This survey highlights that workers‘ confidence regarding their ability to “live a comfortable lifestyle” in retirement has dropped to its lowest point in 23 years, with 28% of respondents identifying themselves as “not at all confident.” Clearly, low savings levels and high consumer debt are problems for workers, demonstrating an urgent need for action. October 2013
3rd Quarter Newsletter 9/30/2013
“We’re from the Government and we’re here to help you.” Bond investors are beginning to wonder if that is still the case. Quantitative Easing, Open Market bond purchases, extended unemployment benefits and disability payments. Is this economic stimulus or financial repression? The fate of interest rates and bond prices appear to be under the direction of the Federal Reserve. This in turn has kept borrowing costs low. Some aspects of the economy appear to have benefitted. Then they mention the “Taper” word and all of a sudden the “safe haven” of bonds doesn’t seem so much anymore. Newsletter 9-30-2013
Why Small Firms Should Consider Setting Up 401(k)s
“Small companies aren’t big on 401(k)s. A recent study by SurePayroll, a company that provides payment services, found that more than 70% of small firms didn’t offer a 401(k) plan to their employees.” See Why Small Firms should Consider 401(k)s
Part II-Service Plan
“Out of sight out of mind” is not how you treat an important piece of equipment. Regularly scheduled maintenance ensures vital machinery and tools perform at optimal levels. The same principles apply to your 401k. Putting in place a Service Plan that addresses the essential elements of your plan can work the same way.
The Service Plan should focus on the main objectives of addressing the fiduciary needs of the 401k sponsor and by extension address the needs of both the sponsor and the participants. A well run plan serves everyone’s best interests. 401k Service Plan
Are Stock Bulls Banking on a Bubbly Endgame?
It’s always dangerous to spin stories about exactly why markets are behaving as they are. And a major hazard of the past few years has been the instinct to point out financial bubbles that weren’t there. But, granting all that, sometimes writing about Wall Street means running toward danger — especially when a provocative narrative is also plausible. See Stock Bulls
Part I-Fiduciary Responsibilities
The fiduciary responsibilities of a 401k plan sponsor on their face seem pretty straight forward. The U.S. Department of Labor lists the essential elements.
Each plan has certain key elements. These include:
- A written plan that describes the benefit structure and guides day-to-day operations;
- A trust fund to hold the plan’s assets1;
- A recordkeeping system to track the flow of monies going to and from the retirement plan; and
- Documents to provide plan information to employees participating in the plan and to the government.
September Retirement Report
To Loan or Not to Loan? As you re-evaluate your retirement plan’s design, consider asking yourself, “Should our plan continue allowing participants to take loans from their retirement accounts?”
If your retirement plan currently permits loans, you are not alone. According to the Profit Sharing Council of America’s (PSCA) recently published 55th Annual Survey of Profit Sharing and 401(k) Plans, loans are permitted in 88% of profit sharing/401(k) plans. September 2013
The Essential Elements of a Successful 401k Plan
The basic framework of a 401k plan is easy to put in place. For it to actually function to help your organization and your employees to more effectively work toward a good retirement outcome requires disciplined execution of a process that focuses a few fundamental concepts. Over the next several weeks we will be posting a series of articles highlighting those concepts and how your organization can put in place the processes to make your 401k plan more successful. Essential Elements of a Successful 401k
How Much You Should Save for Retirement, Based on 139 Years of Data
With the stock market constantly rising and falling, it’s hard to predict what kind of luck you’ll have when you retire and how much you should be saving so you don’t run out of money. One financial expert, however, has found the magic retirement savings rates for most people. How much you should save?