The Frugal Fiduciary Blog

Government Shocker! The 401k Form 5500 May Become Useful Soon

Posted by Eric Droblyen on Sep 21, 2016

 

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Topics: 401k blog, Form 5500

Safe Harbor 401k Plans: Answers To Common Questions

Posted by Eric Droblyen on Jun 15, 2016

“Safe harbor” 401k plans are the most popular type of 401k used by small businesses today. They automatically pass annual ADP/ACP and top heavy tests and allow business owners to maximize contributions to the plan. To achieve safe harbor status, owners are required to make a contribution on behalf of participating employees. For many employers, that trade-off is well worth the cost. Here’s why.

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Topics: 401k blog, safe harbor, small business 401k, 401(k)

What’s Old Is New Again: “Mega Back Door” Roth IRA Contributions Spark New Interest in Old School After-Tax Contributions

Posted by Holly Roussel-Godfrey on May 24, 2016

Ever hear of voluntary 401k contributions? If you are like most people, probably not. They are after-tax employee contributions like Roth deferrals, but subject to different ERISA rules. Voluntary contributions have been around decades longer than Roth deferrals, but are less popular – mostly because their earnings can’t be withdrawn tax-free at retirement like Roth deferrals.

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Topics: 401k blog, 401(k)

Jerry Schlichter Interviewed by Frontline; 401k Sponsors Should Take Note

Posted by Eric Droblyen on Mar 11, 2015

Last week, Frontline published an article as a follow-up to its 2013 documentary “The Retirement Gamble.” That documentary painted a picture of a retirement industry mired in hidden fees and conflicts of interests. In the new article, Frontline interviewed Jerome Schlichter, a St. Louis attorney specializing in suing plan sponsors for excessive 401k fees. Over the years, Schlichter has settled six 401k cases, including cases against General Dynamics, International Paper and Caterpillar. The settlements have been huge and influential, generating $125 million in recoveries to 300,000 participants.

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Topics: 401k plan sponsor, 401k blog, 401(k)

DOL’s Fiduciary Rule Advances to OMB; Not Everyone is Happy about It

Posted by Eric Droblyen on Mar 4, 2015

On February 23, 2015, President Obama announced that the long-awaited redrafting of the DOL’s “fiduciary rule” was being submitted to the Office of Management and Budget (OMB) for review. This rule, also called the “conflict of interest rule for investment advice,” would subject all financial advisors who provide investment advice to retirement plans to a fiduciary (conflict-free) standard of care.

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Topics: fiduciary, 401k blog, small business 401k, DOL

Target Monthly Income and not an Account Balance When Saving for Retirement

Posted by Eric Droblyen on Feb 25, 2015

Most people consider $100,000 a lot of money – I do anyway. But is it a lot of money when you’re saving for retirement? The short answer is it depends upon how old you are. A 30 year-old with a $100,000 nest egg is likely on track for a comfortable retirement at age 65 if they’re saving 10%-15% of their income each year, while a 50 year-old with the same nest egg is likely behind in their savings and will need to save much more each year to catch-up in order to retire at 65.

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Topics: 401k blog, Retirement Readiness

Evaluating 401k Providers: Separating Commodity from Value-Added Services

Posted by Eric Droblyen on Feb 10, 2015

Selecting competent service providers is one of the most important fiduciary duties of a 401k plan sponsor – and it can appear daunting at first glance. Fortunately, this process can be made much simpler by understanding each service that makes up a 401k plan and applying appropriate benchmarks to those services to measure their value. Once you’ve done that, you’re ready to pick 401k providers based on the value of their services.

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Topics: 401k plan sponsor, 401(k) Investments, 401k blog, 401k fees

NAPA stakes a position against the DOL’s fiduciary rule

Posted by Eric Droblyen on Jan 26, 2015

This month, the DOL is expected to propose a “fiduciary rule” for financial advisors that provide investment advice to retirement plans. This rule, also called the “conflict of interest rule for investment advice,” would subject brokers to the same fiduciary obligations as investment advisers. The DOL proposed a fiduciary rule in 2010, but that proposal was withdrawn in 2011 under heavy pressure from some lawmakers and lobbyists representing the financial services industry.
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Topics: retirement plans, fiduciary, 401k blog, DOL, 401(k) advisors

Keeping my Fingers Crossed for 401k Reform in Tonight’s SOTU Address

Posted by Eric Droblyen on Jan 20, 2015

President Barack Obama will give his State of the Union address at 9 p.m. Eastern tonight. During this speech, he is expected to propose reforms to our private retirement plan system. If he does, it will be second year in a row the president addressed retirement plan reform. Last year, the president created the myRA, a new type of retirement account. If you read my last blog, you know I am not a fan of the myRA. This year, I hope the president will do better by announcing his support for the DOL’s proposed fiduciary rule for advisors overseeing retirement plans, now called the “conflict of interest rule for investment advice.”
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Topics: small business retirement plans, retirement plans, 401k blog, small business 401k, 401(k), President Obama

MyRAs are not the answer for expanding retirement plan coverage

Posted by Eric Droblyen on Jan 6, 2015

 

In his 2014 State of the Union address, President Obama directed the U.S. Treasury Department to create a new type of savings account for Americans. The myRA—short for “my Retirement Account”—is designed to be a starter account for workers who aren’t covered by a workplace retirement plan.
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Topics: retirement plans, 401k blog, small business 401k

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