Saint-Laurent Associates, a financial planning company based in Beverly, Massachussets, has introduced an easy way that plan sponsors and fiduciaries can get access to the information their plan provider should have. Plan sponsors can have access to a weekly informational, financial trade webinar series offering insights that are usually limited to those in the 401(k) provider space
More details can be found at http://covidprep.agoodadvisor.org.
The latest announcement aims to provide high-quality resources for anyone interested in optimizing their 401(k) retirement plans according to the latest legislative and financial developments.
The current pandemic has had a strong impact on 401k retirement plans, from new legislative proposals to guidance from the IRS, DOL, or PBGC, such as Notice 2020-23, which extends numerous retirement plan deadlines (even the deadline to distribute 402(g) excess deferrals).
Since COVID-19 information and policies are fluid and potentially confusing, retirement plan sponsors and fiduciaries particularly have been deluged with questions dealing with the issues retirement plans face in today’s tough economy, such as whether or not a layoff/furlough is a separation, the possibility of distribution and whether or not it may trigger a due on termination loan provision, and various others.
According to the company, an even more important aspect is knowing whether one’s 401k provider or adviser has the knowledge and expertise to service them within DOL and IRS guideline.
Saint-Laurent Associates explains that plans sponsors are personally liable for any errors and unjustified expenses and financial losses in participant accounts, regardless of a co-fiduciary adviser engagement. All it takes is one disgruntled participant or ex-employee to launch a class action suit against a company and any employee involved with the implementation of the 401(k) plan. In times of financial crisis, these lawsuits tend to increase.
As trustee of, or person involved with, discretionary judgment authority of a company benefits plan, employers are at risk of being sued by one or all one’s plan participants. A recent Supreme Court ruling on February 20, 2008 (LaRue v, DeWolff Boberg & Associates, Inc.et al) has made the possibility of such lawsuits against retirement plan sponsors more likely. This case has created a precedent that all fiduciaries should heed.
The firm’s new resources aim to help clients navigate the potentially complex circumstances surrounding the latest retirement legislation.
During periods of market volatility and plan losses the possibility of participant lawsuits may be tested even more. Retirement plan sponsors need to take the necessary steps to reduce potential – usually unintended – breaches of their fiduciary responsibilities as outlines in ERISA regulations.
Fred Reish, managing director and partner of the Los Angeles-based law firm of Reish Luftman Reicher & Cohen and a nationally recognized expert in employee benefits law, says: “Although plan sponsors may think they are complying with the 404(c) conditions, most do not satisfy the 20 to 25 necessary conditions for proper participant education – and that could mean that committee members and other fiduciaries may be in for a rude awakening if they are faced with claims of investment losses because of imprudent participant decisions.”
Until now, no benefits plan provider has been able to meet all the criteria necessary to mitigate plan sponsors’ fiduciary liability.
The Beverly financial planning company explains that some of the standard features of compliant plans which help reduce fiduciary risk while increasing transparency for participants according to DOL and ERISA regulations are:
– co-fiduciary responsibility by offering discretionary trustee services to reduce fiduciary liability;
– credentials not held by most firms: CEFEX (Center For Fiduciary Excellence), ERISA 3(38) and 3(21) Advisors;
– unique investment models offering tactical investment strategies based on proven computer-based algorithms;
– unbundled, low fees: unbundled plans typically reduce expenses by 15%, on average, including advisory fees, compliance testing and 5500 filings fees;
– quarterly bench-marking: regular due diligence, bench marking, and replacement, if necessary, of poor-performing funds;
– investment advice: one-on-one advice at no additional cost designed to consistently increase financial literacy and participation rates.
– plan document cloud-based access: paperwork reduction and ease of access for sponsors and participants via a user-friendly web site interface.
With its new resource series, the company is offering access to essential information on all relevant 401(k) recent developments.
For those that are not able to attend a webinar series, the company provides a brief compliance review to see if one’s plan is within DOL and IRS compliance and my have any “red flags” deficiencies, which government auditors will use to issue potential sanctions and fines. The resource is available at https://tinyurl.com/401kcheck.
Interested parties can find more information by visiting the above-mentioned website.
Release ID: 88962254