By now you have heard about the "final final" DOL ruling and the delay.
A compilation of articles on this topic appears below.
The important question is how do you reduce your stress and liability dealing with these new regulations - not one-time, but every year from now on?
There are two ways to turn the "annual fee disclosure drama" into a non-issue.
1) Move to a transparent plan delivered by fiduciaries. (Eliminate the source of the problem.)
This is what we do for our clients with "standalone" plans. These are competitive in cost, significantly reduce your fiduciary liability and include investment advice for your participants. In other words - much higher value for same or lower cost. All of our plans, including the MEP below, contain the best passive investing fund building blocks on the planet from the Nobel Laureates at Dimensional Fund Advisors (DFA).
2) How about exiting the plan sponsor role altogether? Free up more time for yourself or your HR executive. Throw your plan sponsor hat in the trash can. Yahoo!
The MEP (multiple employer plan) is "the solution". The plan is similar to our standalone version - but with a key difference -- a group of companies are in one plan, still each completely flexible with their company parameters. The companies in the plan delegate the plan sponsor duty to one overall plan sponsor. Liability drops to near zero and time/hassle drop significantly. Cost continues to be competitive with even more value. It includes investment advice for your participants too. Unless you have some unusual quirk in your 401(k) plan that you "must have", we strongly recommend the MEP. Our MEP is truly the "greatest no-brainer in the history of 401(k) plans"!
Here are the articles:
401k Fees Hidden Till August
Finally the Final ... 408(b)(2)Regulation (4 page PDF report by nationally recognized ERISA attorneys Drinker, Biddle)
ERISA Blog Article on the Extension
Labor Dept Delays Roadmap (Reuters)
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Common Mistakes
The biggest mistake we see is plan sponsors not taking a few moments to understand the difference in the status quo and a plan structure that includes an ERISA 3(38) advisor as we offer. The improvements are vast. When you move to a clean transparent plan that includes an ERISA Section 3(21) and 3(38) advisor - and eliminates 12b-1 fee paying mutual funds - then all the problems occurring inside 99% of the plans, that the DOL Regs attempt to fix just disappear. Plan sponsors that have these type of "clean" plans will have a much easier time dealing with the 2012 regulations. Your fee disclosure to plan participants is simple, clean and reasonable.
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What to Do Next
Problem Solved: Use an ERISA Section 3(21) independent advisor (RIA) that insists on bringing an ERISA Section 3(38) independent advisor (RIA) with them. They both have strict disclosure requirements built into their licensing so that complete transparency is the norm from day one. They'll be watching each other as well as the TPA, record-keeper and custodian, that are also independent. Multiple checks and balances - a fiduciary wouldn't have it any other way. Call us at 760-804-0910. Newsletter Archive
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