Call Us Today! 516-594-1557

Bad Plan Provider Behaviors You Shouldn’t Emulate

When I met co-workers or law firm partners that were cruel, I always wonder if that was a choice they made or whether it was a personality disorder. I treat people the way I wanted to be treated and for the most part, it has worked out. There are plan providers out there that while might be few and far between, they have behaviors that you should never try to emulate. These are the bad plan provider behaviors you shouldn’t copy.

DOL announces Form 5500 Changes

The Department of Labor (DOL) announced changes to Form 5500.

For Multiple Employer Plans (MEPs), new codes have been added to Line 8a of Part II to identify different types of MEPs, such as pooled employer plans, association retirement plans, professional employer organization MEPs, and other MEPs.

For Schedule MB, used by multiemployer defined benefit plans and certain money-purchase plan actuarial information, instructions for Line 3 have been changed to require an attachment that shows total withdrawal liability payments by participating employers, made to the plan while separating periodic and lump sum withdrawals. Line 8b(1) was updated to increase the projection period in the attachment to 50 years for plans with 1,000 or more participants. Line 8b(3) has been changed to require plans with 1,000 or more participants to attach a 10-year projection of employer contributions and withdrawals. Schedule R, Line 13 of Part V was changed to require plans must report identifying information about any participating employer who either contributed more than 5% of the plan’s total contributions or was one of the 10 highest contributors.

The instructions for Form 5500, have been updated to reflect an increase in the maximum civil penalty amount assessable under ERISA.

Robinhood offers IRAs

Robinhood is rolling out retirement accounts for users of its mobile app, by offering a 401(k) like match to IRAs.

Robinhood will offer customers a 1% match on its traditional or Roth IRAs. Users can start investing on deposits of up to $1,000 before contributions settle into their accounts. Customers will get 1% on IRA contributions up to the $6,500 limit.

The launch allows Robinhood to against brokerage giants, like Fidelity, Charles Schwab, and Morgan Stanley’s E*TRADE.

Full availability on this IRA offering is set to begin in January.

Avoid the nonsense on anti-ESG rhetoric

My wife forwarded me an op-ed piece, criticizing the Biden administration rule change on ESG investments in 401(k) plans. Obviously, the person writing it doesn’t understand how 401(k) plans work.

The ESG rule isn’t licensed theft to pursue a woke agenda, whatever that means. Most 401(k) plans are participant-directed, so the ESG rule will merely allow 401(k) plans to add ESG funds to their fund lineup. It will be up to plan participants to decide whether their account balance should be used for a woke agenda.

I’m not in favor of the ESG rule because I think the main aim is for total return and ESG funds don’t do that. However, I could see nonsense when I read it.

Two BlackRock cases dismissed

Two lawsuits questioning the prudence of plans holding the BlackRock Lifepath target-date funds were thrown out.

The two suits, one involving Capital One Financial Corp., and the other involving Booz Allen Hamilton were both dismissed by U.S. District Judge Michael S. Nachmanoff.

The judge rejected arguments that the BlackRock funds could be compared with similar funds without considering different strategies, glide paths and investments.

Oakland registration is open.

Oakland has been booked for Friday, April 14th.

For information on sponsorship, which starts as little as $500, please click here.

To register for just $100, please click here.

We will have tickets for the game that night vs my New York Mets.

Detroit registration is open.

We will have a great event in the Motor City this May 3rd. Information and signup is available here.

For information on sponsorship, which starts as little as $500, please click here.

National Virtual Conference registration is 2 weeks away. Registration is $2.23

Our national event is virtual again. Spread over 2 days in January, you can attend the event from the comfort of your office or home.

For 401(k) advisors, it's the most fun for just $2.23, you read that right.

For information on sponsorship, which starts as little as $500, please click here.

VOLUME 14 ISSUE 1

January 2023

Get In Touch With Us