Prior to SECURE 2.0, AFNs were generally required to contain information about the plan’s funded status, investment policies, regulatory filings, participant demographics, and other key information. Though the goal of keeping relevant parties informed through AFNs remains the same, some of the requirements for the specific information to be included have changed, including:

Funded status: Single employer plans must now must report the “percentage of plan liabilities funded,” which is the ratio between the fair market value of the assets on the last day of the plan year and the value of the liabilities determined as of the last day of the plan year using market-related interest assumption.
Demographic information: Required information is the same, but now must be determined “as of the last day of such plan year and the preceding 2 plan years, in tabular format.” Plan administrators of small plans have “up to 9 ½ months following the last day of the notice year to furnish the annual funding notice.”
Funding policy: Plans now must additionally disclose the “average return on assets” for the notice year in the annual funding notices of both single-employer and multiemployer DB plans.
PBGC guarantees: Single employer plans now must additionally disclose that “if plan assets are determined to be sufficient to pay vested benefits that are not guaranteed by the [PBGC], participants and beneficiaries may receive benefits in excess of the guaranteed amount,” along with a disclosure that in the event of a plan’s termination, the PBGC’s calculation of the plan’s liabilities may be greater than what is disclosed in the AFN.

The following language may be used to describe benefits eligible to be guaranteed by PBGC upon plan termination, according to the DOL:

“Participants and beneficiaries may receive benefits greater than the PBGC guaranteed amount but only if PBGC determines the Plan’s assets are sufficient to do so. Because PBGC makes this determination using different assumptions than the Plan, the additional benefits received may not correspond exactly to the Plan’s funded percentage. For example, just because a plan is 80% funded based on the plan’s assumptions, does not mean participants in that plan will receive 80% of their vested benefits.”

Related: New SECURE 2.0 rules & state mandates: Is your 401(k) plan in compliance?

According to the DOL, SECURE 2.0 compliant notices must be provided for the 2024 notice year no later than: 1) the date the plan administrator files the annual report for the 2024 plan year; or 2) the latest date by which the 2024 annual report must be filed, whichever is earlier.