Understanding how forfeitures work in retirement plans When we talk about 401k type retirement plans we sometimes focus on the contributions made by employees that are ALWAYS immediately vested. In other words, it’s THEIR money and they can always withdraw it without forfeiting ANY-…
…owner or beneficiary for QCD purposes is a person who has attained age 70 ½ or older, and has assets in traditional IRAs, Roth IRAs, or “inactive” Simplified Employee Pension (SEP) IRAs or Savings Incentive Match Plans for Employees (SIMPLE) IRAs. Inactive means there are…
…be educated consumers of 3(16) fiduciary services. Running a qualified retirement plan for employees is like running a business for clients. Just as with a business, the administrative responsibilities and liabilities of operating a plan are significant. The Department of Labor (DOL) views all business…
…101, “Expanding automatic enrollment in retirement plans,” of the newly enacted SECURE Act 2.0 of 2022 is intended to build on that idea. Beginning with the 2025 plan year, newly established 401(k) and 403(b) plans must automatically enroll employees in a certain type of eligible…
At a glance, compliance tests assure that every retirement plan is producing a meaningful benefit to rank and file employees and that it demonstrates a level of fairness in the benefits those same employees get as compared to the benefits achieved by owners and other…
…opportunity for rank and file employees to participate while giving owners a more generous savings path. And don’t forget, the IRS provides all employees over the age of 50 the opportunity to make what are called “catch up” contributions. This might be the best named…
…other factors. So, a simple formula might allocate 3% of compensation to all eligible employees. Participants share on a pro rata basis. A company owner might ask – can we include the contributions we make to social security as a factor in our formula? The…
…save. Some may want a way to contribute a share of profits to their employees’ retirement. Some are looking to provide an incentive for employees to stay around longer. And some need a competitive retirement benefit to attract and retain top talent. If we truly…
…about how participant loans affect long term retirement outcomes. On one hand, it’s not hard to appreciate that employees may be more motivated to enroll in a plan that includes a loan feature since it provides comfort that they’ll be able to access their savings…
…to save at a high enough rate to meet real income needs later in life. An important way to help employees of company-sponsored retirement plans make real progress for themselves is to offer auto-enrollment and auto-escalation features to retirement plans. Both can positively influence retirement…