I recently spent a whole day in Salt Lake City discussing operational nuances and considerations with ERISA 403(b) plans that have more than one service provider. As this is the case with a large number of 403(b) plans, even those with a single current provider due to service provider contracts that require individual releases to transfer. Some always remain with a former provider.
I love the mountains, and the view from the conference room was awesome. I think kids today overuse that word, but to me, the mountains are truly awesome, and I was thrilled to be able to look out the window during our discussion. One item that took my attention away from the picturesque vista was a discussion around beneficiary designations. These could be truly problematic when there are multiple service providers involved. This is true for any plan with multiple providers, and not just ERISA plans. Read more
I’d like to thank you for indulging me as I take one last dramatic turn in my blog series featuring the “Seven Administrative Sins.” In each blog, I’ve uncovered the errors 403(b) plan sponsors make (many times unknowingly) that can doom their plans – either from a compliance perspective or through administrative adversity.
To get up to speed, you can read the first blog of this series, where I talked about how problems arise when many plans have provisions to force out small amounts, as well as the limitations regarding retirement plan loan limitations. In the second blog, I introduced two more “sins” – hardship distributions and Qualified Domestic Relations Orders (QDROs).
At the Principal Financial Group®, we typically see these type of problems crop up when a 403(b) plan sponsor who is shopping for a new service provider comes to us in search of a professional to guide them. Which brings me to the last chapter – the final three (and possibly the most pervasive) sins a plan sponsor can make. Read more
This is my second of three blogs in a series I call the “Seven Administrative Sins,” which I know sounds a little ominous. Yet I’ve found it’s an effective way to point out the mistakes 403(b) plan sponsors make that can put a non-profit plan out of compliance – or turn it into an administrative monster.
In the first blog of this series, I talked about the problems regarding how many plans have provisions to force out small amounts, as well as the limitations regarding retirement plan loan limitations and the challenge of tracking them. In this blog, I will introduce two more “sins” that can plague 403(b) plan sponsors – and suggest a way to help them. Read more
Despite conventional wisdom that says one shouldn’t discuss religion or politics in social situations, I invariably find myself in conversations about one or both. Thankfully the discussions regarding religion have never touched on something as philosophical as the “Seven Deadly Sins” (I was definitely not a philosophy major!). But the concept got me thinking about the mistakes that 403(b) plan sponsors make—the “Seven Administrative Sins” if you will, that can put a non-profit plan in real jeopardy.
While the majority of “sins” are committed unknowingly, they have the potential to create some real administrative and compliance-related issues for plan sponsors—problems that could be avoided and rectified with the help of a financial professional. In the first installment of this series, I will go over the first two sins—the problems that surface as we at the Principal Financial Group® are assisting a plan sponsor. Read more
While I love college football, I’m not a pro football fanatic by any means. I do enjoy a few good pro games each season – and am so glad those painful pre-season games are behind us! Yet I’m always intrigued by how the coach will play their star players for maybe the first quarter and then usher in a gaggle of no-name back-ups to finish it out. It makes for must-snore TV.
I know it’s for good reason – they want to keep their starters healthy, evaluate their second and third stringers, etc. But I wonder if they don’t go with their best line-up, how will they really know what level of talent they’ll have on the field once the real season starts?
I liken this to what I learned from the recent results from surveys by the Plan Sponsor Council of America. I realized that the 401(k) plans were largely outscoring 403(b) plans in some key plan features. Read more
Ah, summer time! I’m not one of those people who prefer summer over the other seasons, but I will admit it has its delights. For example, I was able to get together with one of our field service leaders recently, and we had some time to throw a line in the water and do a little fishing. Some people play business golf. I do a little business fishing.
(Maybe someday, if I could ever elevate my golf skills to “lousy”, I could add a little business golf in there as well.)
Whether it’s fishing or golf, the opportunity to maintain and develop business relationships on a face to face basis is of key importance. Read more
In the retirement plan world, change equals opportunity for financial professionals, and change has been a constant among 403(b) plans since the Internal Revenue Service (IRS) passed significant regulations in 2007 (effective 2009). But the biggest opportunity for change right now lies in one key segment of the 403(b) market: private higher education. Private colleges are discovering there are better ways to approach retirement plans for their participants. Read more