Pentegra recently received a call regarding a common inquiry related to SECURE Act 2.0 of 2022 (SECURE 2.0). “My client wants to terminate its SIMPLE IRA plan during 2024 and start a safe harbor 401(k) plan as allowed by SECURE 2.0. What types of safe…
In this article we review the Department of Labor’s (DOL) recently (January 29, 2024) proposed regulation implementing SECURE 2.0’s statutory prohibited transaction exemption for automatic portability transactions that meet certain conditions. Automatic portability is, in effect, a “different way” to implement mandatory distributions (distributions of…
Despite all the 401(k) media attention and national plan fiduciary discussion, plan sponsors continue to make very common mistakes year over year that are relatively easy to identify, fix and avoid, with the right help. Mistakes can be opportunities to improve existing retirement plans for…
Most CEOs and other executives just want to run their businesses. Whether they help run a factory, a consulting firm, or a school, they’d prefer to focus on what they are best at: leading, serving, and building their business. Most are not interested in becoming…
As we embark on yet another “testing season” for retirement plans, we are again reminded of all the ways that employers may run afoul of numerous compliance rules. Of course, compliance concerns may arise at any time, but this time of the year reinforces the…
Cash balance plans seem to be getting a lot of attention recently. And for good reason. They can provide substantial benefits—both immediate and long-term—to employers. Plus, they offer employees a clearer picture of their retirement benefits than traditional defined benefit plans. Here we will take…
The Department of Labor (DOL) requires retirement plans with at least 100 eligible plan participants to submit an audit report with their annual Form 5500 return. As you might expect, any audit—even if it’s a routine review—can create anxiety for a plan sponsor. Working with…
So many things are simply better together—peanut butter and jelly, baseball games and hot dogs, summer and a good book. Add to that list a 401(k) plan with a cash balance plan. When it comes to retirement plans, too often the discussion focuses on one…
In previous articles, we explored some of the basics of cash balance plans. Now we’ll go into more detail on one of the surest ways for certain businesses to ensure substantial retirement benefits for their employees. A Primer on Defined Contribution Plans Versus Defined Benefit…
Watch an Olympic gymnast compete in floor exercise, and it seems as if the routines are almost effortless. But years of practice and endless hours of perfecting moves create this demonstration of strength and grace. Now compare a toddler’s tumbling maneuvers on the living room…
If you are ready to explore the possibility of establishing a retirement plan for your business, there are many plan design options that may fit your needs. Whether your business is large or small, whether it has unique requirements or not, or whether you simply…
For decades—before the 401(k) plan came on the scene—defined benefit (DB) pension plans ruled the retirement plan world. If an employer offered a retirement plan, it was quite likely a DB plan. Certainly governmental and union plans were almost always DBs. And many private sector…