For whatever reason, advisors and plan sponsors seem to take the Fifth when it comes to exposing their thoughts in public. Our retirement topics are popular with benefits professionals, but plan experts choose to stay mum in our comments section.
But you're not a silent class of professionals. I get reader emails every week full of everything from best practice questions to regulation opinions to helpful suggestions on my writing.
And though I might not respond right away to every query or criticism, this is my humble request from you: Tell me what you think – whether it's out in the open or disclosed via email – about the most pressing issues ahead this year, and subsequently, what you're doing about it.
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In the words of Linda Richman, talk amongst yourselves. I'll give you a topic:
Fee disclosure: The 401(k) industry impatiently awaits a final resolution on 408(b)(2) regulation (service provider compensation disclosure) at the end of January, and many marketing and compliance dollars already have been invested in preparing for the 404(a) regulation under which 72 million plan participants will be told what they're paying for their 401(k) plan.
While it's no doubt a game changer for participants, it's a hell ride for advisors and sponsors. If you haven't noticed, the American Society of Pension Professionals & Actuaries decided last year was time for employer-sponsored retirement plan advisors to unite in their niche and have a voice in Washington through the National Association of Plan Advisors.
[See also: Top 5 changes to 401(k) market in 2012 and The impact of 408(b)(2) disclosure regulations on TPAs]
Fiduciary standard: As BenefitsPro and Benefits Selling magazine columnist Chris Carosa reiterates, "By the end of the first quarter, we'll have two competing regulatory versions of the Fiduciary Standard (both of which will compete with a third legal version of "fiduciary"). The SEC will soon pronounce a Fiduciary Standard representing neither a true meaning of fiduciary nor a true standardization. Nearly all will complain. Around the same time, the Department of Labor will reissue its new Fiduciary Rule, which will satisfy most save for the most conflicted service providers and the strictest adherents of fiduciary law." [See Three sure-fire 401(k) predictions for 2012]
You may have noticed plan providers ramping up their fiduciary services. The Principal is the latest in a slew of major firms to partner with a fiduciary consultant (Santa Monica-based Wilshire Associates).
Lifetime income options: Lawmakers lately have tinkered a lot with requiring plans to offer a lifetime income option in defined contribution plans and to give participants an idea of the amount of savings they'll be able to distribute throughout their retirement without running short of funds.
Emily Meyer, an associate in the Employee Benefits & Executive Compensation Practice Group at law firm King & Spalding, wrote a concise review of the contentious subject, which you can find here: http://www.martindale.com/employee-benefits-law/article_King-Spalding-LLP_1397118.htm
Pension reform: Liabilities are ravaging the infrastructure and economic threshold of local communities. Just look at Rhode Island – a small state with a huge pension problem. After just overhauling the state's pension system, the state is mulling over giving cities and towns the authority to cut pensions or else raise taxes or slash services.
Many other states are just as dire. For a good centralized resource on pension reform, visit the International Foundation of Employee Benefit Plans' "Pension Reform Central."
Retirement readiness: In short, not many are ready.
Have I missed something? Let me know. No big whoop.
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