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Common Cash Concerns: What Signs Can Be Found in the Guidance for Secure 2.0 Act Sections 304 and 348?

Recently, the IRS issued guidance on implementing section 348 (cash balance accounts). This guidance may hint at potential regulatory flexibility towards plan testing. Similarly, section 304 (automatic cash out of small accounts) could lead to flexibility in plan audits for small plans.

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Navigating Benefit Cutbacks: 8 Tips for Communicating Effectively with Employees

In the realm of employee benefits, change is inevitable. Sometimes, however, change comes in the form of cutbacks, which can be unsettling for employees. As a plan sponsor, effectively communicating these changes to your workforce is paramount. In today's landscape, where employees expect transparency and authenticity, navigating benefit cutbacks requires finesse and a departure from traditional corporate speak.

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AI and Benefits Policy Management: Guidance on the Use of AI

As corporate governance business processes become part of plan litigation, and because benefits may be an area ripe for budget trimming, management of employee benefits policies is attracting more attention. Caution is due in this area as AI systems create their own risks.

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EBSA Enforcement Data: Are Enforcement Numbers Up?

Has the agency tasked with enforcing ERISA performed on the prediction of increased enforcement action under in the Biden Administration or did it focus on new regulations instead? We compared the first year of the new administration to last year to find out.

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Everyone’s Talking About Aging, So Why Can’t Advisors?

The public is having a very heated conversation on aging and capacity, especially when it comes to holding political office. Some may even want a break from the coverage of older politicians and their foibles. But one arena that may need more discussion of longevity and aging is retirement planning.

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“Have I answered All Your Questions today?”

One aspect of active listening that advisors may want to consider involves asking confirming questions. Yet, some business experts suggest avoiding the most common of those confirming questions: “Have I answered all of your questions today?” Here’s what advisors can do to think of how to adopt this phrase in their client communications.

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Post-Hughes, Mid-Lawsuit Frenzy: Keeping Records on Your Recordkeeping Fees May Be Crucial

2023 ranks among the highest for number of lawsuits against plan administrators in the last decade or so, and 2022 had nearly 100 such suits. One reason for the spike is the 2021 Supreme Court ruling in Hughes v. Northwestern. This summer, the lower court ruled on the Hughes case, and its findings further muddied the waters on recordkeeping fees.

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Trend Watch: Pension Popularity

Into the brave new world of post Secure Act 2.0 benefit administration comes new and challenging accommodation requests for things such as mental health and long COVID-related illnesses, which may create confusion over balancing and discrimination testing a plan. So, we can only imagine the dismay some benefits advisors may have over news noting an increased favorability of pensions.

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Supreme Court Weighs Power of Agencies Like the DOL to Impose Penalties without a Jury

Last Fall, we noted several cases before the U.S. Supreme Court that could impact the power federal agencies have to regulate and prosecute plan sponsors. Many of those cases are now working their way through the Court and may have profound impact on agencies such as FINRA, the SEC and the Consumer Finance Protection Bureau. They may also impact the Department of Labor and its investigative wing, the EBSA.

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Divesting Inflation Demographics: Consumer Studies May Show It’s More Than Inflation Irking Investors

Two recent studies released in January of 2024 point in opposite directions: one indicates that inflation may be slowing down quieting consumer concerns, others say inflation is still top of mind for most workers. What gives? It may be where investors live. For advisors struggling with determining how to manage inflation’s impact on their clients, digging into these studies may help.

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New Year, New Rules: Fiduciary Duty Rules and Independent Contract Rules May Put Advisors in a Pinch

Financial advisors may feel like they are finding themselves between a rock and a hard place lately and both rock and hard place may be the doing of the Department of Labor. If you thought the proposed fiduciary rule was the only problem popping up, beware the independent contractor definition changes.

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Major Overhaul of Financial Regulations Coming? Supreme Court Considers Chevron Change

Three major supreme court opinions may be coming soon that could have significant implications for financial advisors and they may not be the ones you’ve heard about. These cases may be more significant: they may reduce the ability of agency regulators to oversee, investigate, and fine financial advisors and institutions by changing a long-held rule deferring to federal agencies in their decisions.

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New Statistics on American’s Feelings About Annuities and the DOL’s Fiduciary Rule: Possibly Out of Synch

If you are searching for answers to this knowledge gap, don’t look to advisors. Results from a study released by the Harris Poll in August 2023 showed that advisors are twice as likely (80% to 40%) to include annuities as asset protection and diversification tools over EFTs. What’s the holdup?

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Profit Vultures and Compliance Culture

Among the many takeaways from the Binance charges and the Bankman-Fried trial how charisma can impact a company’s disregard for business basics, such as an accounting department in the Bankman-Fried case. Unlike cranberry sauce at Thanksgiving, you can never have too much consideration of compliance in the financial industry. Company culture can be a big player in how employees put compliance into effect.

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Luxury Lapses: Quiet Luxury and Prospect Clients

As 2023 ends, it may be that luxury brands are showing a lapse in both profit as well as sway on consumers. For financial advisors who look to track luxury brands in their marketing and advertising approaches, this could be an important trend to track. And it isn’t all negative.

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Inflation and Retirement Investing: Revisiting the Saving by Side Hustle and Its Drawbacks.

If you think inflation is last year’s news, you may be out of step with employees. COLA increases by SSA and inflation adjustments by the IRS to retirement accounts show that inflation is still running rough on employees’ savings. And now two new studies show investors are very concerned about inflation’s impact on both the date and amount of their retirement.

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Tips for Tackling Employee Concerns on Volatility

Employee concerns about worker strikes and military action in the middle east region may show anxiety about market volatility and retirement fund safety. Plan sponsors may want to pause and consider how they can use employee surveys to gauge the level of employee distress over volatility as well as how to address those concerns.

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Empowering Retirement Choices Among Plan Participants

Employees may be chafing from feeling forced towards action in other areas of their life that seems to be morality-based or “woke.” Will that discomfort translate into unhappiness with the actions of plan sponsors to encourage retirement readiness? Sponsors may have some options for how to continue incentivizing employees to enroll in retirement plans.

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Overseas Plan Participants Refresher

Events outside of the United States have been on everyone’s hearts and minds this fall. Plan sponsors may be concerned for their own families and loved ones, and also for their plan participants who have retired overseas. Nine million Americans live abroad, according to the State Department. Those living abroad may have two concerns when it comes to their retirement funds: bank account access and email.

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Benefits and Recruitment: Protect Your Online Reputation

Benefits can be an important part of the view prospective employees have of your company and whether they want to apply. How can you make sure your benefits measure up? We have a few thoughts.

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New News: Substacks for Your Plan Participants?

If you’ve been following financial writers on other platforms for topics to cover in employee education sessions, it’s worth your time to consider what Substack writers have to offer. And, if you recommend accounts on your employee education pages, adding other sources with in-depth information may increase your employees’ knowledge base. We’ve picked a few we enjoy.

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The Tax Man Cometh, and He’s Bringing a Friend: Greater Hiring at the IRS Shows a Potential for More Enforcement and Audits

The IRS’s new details on how it will increase its hiring shows a potential for increased scrutiny and potential audits for 401(k) plans and investors with complex wealth basis.

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Good Luck Gen X

For a generation named for its inability to be quantified it may come as a surprise that Generation X may go down in history for having the worst numbers, at least when it comes to retirement. Generation X, those now in their 40s and 50s, account for about one-fifth of the population, a significantly smaller cohort than other generations and yet their worries are weightier than others.

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Communications Plan Series, Part 3 of 3: Down to the Nitty Gritty on Your Calendar

For many professionals, the end of the year means nailing down the details of key business plans, like your marketing and communications plans. That is why we’ve scheduled this series on how to construct and format your communications calendar to right when you may need it.

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Can’t Touch This: AI Can’t Beat the Human Touch

These days, artificial Intelligence is top of mind for almost any professional. Financial advisors are no exception. They have often had to justify how their work can’t be replaced by that of a robot. First, were robo-indexes. Then the algorithms. And now, artificial intelligence, specifically ChatGPT. But good news humans! AI makes for a terrible financial advisor. Here’s what you should know.

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Authors

Beau Adams
Executive Vice President, BCG
John Correll
Client Relations Team Leader
Kevin Bonner
Regional Retirement Sales Director
Nina Wilkinson
Client Relations Manager
Robert Terry
Retirement Plan Sales Manager

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