Watch What You Say: Employee Benefit Claims
Jana Steele explains how a new EBSA letter on informational calls with plan participants affects sponsors.
Will Boring Still Be Beautiful?
A simple, “boring,” glidepath beat a diversified one over the last 10 years. Will that continue?
IRS Announces Updated Retirement Plan Limits for 2021
The IRS announced the updated retirement plan limits for 2021.
Our DC Index Had a Noteworthy First Quarter
The Callan DC Index™ tracks roughly 100 defined contribution (DC) plans with about $250 billion in total assets. The Index serves as a proxy for the DC universe and provides plan-related statistics such as asset class prevalence, average allocation figures, and the average number of plan investment options. With our comprehensive perspective on the DC […]
DOL Issues Common-Sense Information Letter About Private Equity in DC Plans
In an information letter released in June, the Department of Labor said that defined contribution (DC) plan sponsors considering the inclusion of private equity in their plans (in a multi-asset framework) must adhere to the same standards and weigh the same considerations as they would for other asset classes. Namely, plan fiduciaries “have duties to […]
Freezing or Suspending Matching Contributions: Requirements and Timing
DC plan sponsors hit hard by the recent economic environment are evaluating if reducing or suspending matching contributions is prudent. The presence of an employer match both supplements and encourages employee retirement savings. Background Plan sponsors have been more likely to decrease or suspend matching contributions during periods of economic hardship. This was seen in […]
Guidance on Substantial Workforce Cuts and DC Plan Terminations
Employers that reduce their workforce or discontinue defined contribution (DC) plan eligibility for certain employee groups may experience an inadvertent “partial plan termination.” If not properly managed, this event could result in a disqualification of the entire plan. Background A partial plan termination is typically triggered by a distinct event or series of events (e.g., […]
How the Coronavirus Relief Bill Affects DC Plans
The coronavirus relief bill, known as the CARES Act, seeks to address the recent economic tremors stemming from the coronavirus pandemic. Certain provisions look to liberalize loan and distribution availability for certain DC plan participants (i.e., “qualified individuals”). Background The CARES Act was signed into law on March 27. Drafting this legislation was expedited, which […]
Balancing ERISA Rules With Current Economic Concerns
Plan sponsors have traditionally sought to limit “leakage” from defined contribution (DC) plans. However, in these chaotic times, sponsors should consider how they can support participants in financial distress. Background The coronavirus pandemic has led to significant economic tremors, including income insecurity and job reductions. As a result, plan sponsors and participants are looking to […]
How DC Plans Should Prepare for Missed Loan Payments
Takeaway: The significant economic tremors, including income insecurity and job reductions, stemming from the coronavirus pandemic may lead to increased loan defaults and impact long-term retirement readiness. Background: Defined contribution (DC) plans have the option of offering loans to participants. Generally, the participant must repay a plan loan within five years (except for purchases of a primary […]