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The mission of the Partners is to empower all of us to go directly to each other with our expertise. FiduciaryFirst is considered an industry leader and our knowledge and informative blogs can help you gain an understanding about key topics within the industry.

With President Donald Trump’s Memo, DOL Rule on Hold

  If you’re wondering what the status is for changes to the 401(k) fiduciary rule, you’re not alone. On Friday, February 3, President Donald Trump signed a memorandum that asked the Department of Labor (DOL) to review the fiduciary rule that was scheduled to go into effect on April 10. The memo doesn’t revise or repeal the rule, or require the DOL to delay its implementation. However, it’s likely the DOL will delay the rule’s implementation to give the department time to conduct its analysis. President Trump’s stated goal is to, “empower Americans to make their own financial decisions,” and he feels the rule limits the number of investment options that financial advisors can offer to their clients. His instructions to the DOL require the department to determine whether or not the rule “may adversely affect the ability of Americans to gain access to retirement information and financial advice.”1 The DOL’s...
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Millennials: Start Saving Now

  Typically, younger people don’t make retirement savings a priority. Living expenses, student debt, rent or house payments, and other day-to-day expenses mean that retirement savings take a back seat. In fact, a Franklin Templeton Investments survey from January 2016 says that 40 percent of millennials don’t have a retirement plan in place, and 57 percent haven’t started saving.1 That attitude, however, will make it much more difficult to have a secure retirement later, though, according to seasoned pension consulting practitioners. The main thing that millennials are sacrificing by not saving now is time. Time allows funds to grow through compounding, and that can turn relatively modest savings into much larger nest eggs. For example, saving $50 each month in a retirement account earning 6.5 percent annually and compounded monthly would generate retirement savings of $226,781 over 50 years. A millennial who starts saving the same amount 30 years later,...
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Nonprofit Organizations Are Particularly Vulnerable to Retirement Plan Lawsuits

In 2016, a number of large universities faced lawsuits alleging that their 403(b) contribution plans charged excessive investment and recordkeeping fees and kept expensive, underperforming investment options in the plans. Many of the suits have already been settled with universities paying out millions. 403(b) retirement plans are similar to 401(k) plans, offering tax-advantaged savings for employees of public education institutions, some non-profit employers, some hospital service organizations, and self-employed ministers. These 403(b) plans are particularly vulnerable to lawsuits since there was little oversight of these plans before new 403(b) regulations were adopted in 2007. In fact, before 2009, 403(b) plans weren’t even required to have a written plan document. Traditionally, 403(b) plans provided an extensive array of investment options, including annuities. Some plans offered literally hundreds of investment options. With the increased number of legal challenges, every nonprofit organization that offers a 403(b) contribution plan needs to conduct a thorough...
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The Impact of Auto-Enrollment into Retirement Plans

Americans are saving more for retirement, according to a survey released by the Plan Sponsor Council of America.1 In fact, employees put 6.8 percent of their paychecks into 401(k) and profit-sharing plans in 2015. In comparison, employees contributed only 6.2 percent of their salaries in 2010. Why the increase? One reason may be that 57.5 percent of retirement plan sponsors have included an automatic enrollment feature in their plans. An automatic enrollment feature in a retirement plan allows employers to enroll eligible employees in their retirement plans unless the employee chooses to opt out of the plan. It’s often used for 401(k) plans, but can also be included in 403(b) plans, 457(b) plans for government employees, Salary Reduction Simplified Employee Pension plans (SARSEPs), and Savings Incentive Match Plans for Employees (SIMPLE) IRA plans. Automatic enrollment clearly boosts retirement plan participation. According to Bloomberg, in plans that feature automatic enrollment, 89...
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The New Department of Labor Fiduciary Rule is Changing the Financial Employment Landscape

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