Winter 2011
Retirement Confidence Is Still Down
A new Towers Watson survey of more than 9,000 full-time employees indicated that workers continue to be concerned about a secure retirement, as respondents were when a similar survey was conducted in 2009. The current study found that market turmoil and declines may have a more long-term effect than previously expected.
Learn more about the survey's findings.
continueResearch Reveals Retiree Income Sources
Research conducted by the Employee Benefit Research Institute (EBRI) confirms that Social Security is the largest income source of those ages 65 and older. EBRI based its analysis of the U.S. Census Bureau's 2009 Current Population Survey.
Discover the average sources and proportions of income for today's retirees.
continueThe Four Major Regulatory Events of 2010
The retirement plans industry saw a great deal of legislative action in 2010. The Department of Labor and the Securities Exchange Commission in particular have been active with proposed or final regulations that will affect how qualified plans are administered.
The Standard has prepared timely information about participant and plan sponsor fee disclosures, fiduciary definition, Roth in-plan conversions, and disclosures for QDIAs and target-date funds.
continueReminder about The Standard's annual compliance process
If your retirement plan with The Standard has a Dec. 31 plan year end and is subject to ADP and/or ACP compliance testing, we will need to receive your year-end data by the end of January. This time frame will allow us to complete the testing for your plan in advance of an Internal Revenue Service deadline (any necessary corrections preferably occur within two and one-half months after the plan year end).
continueAutomatic Enrollment Can Boost Savings
Research by the Employee Benefit Research Institute (EBRI) found that automatic enrollment and automatic contribution increases can significantly improve retirement savings, particularly for low-income workers.
With more optimal use of automatic features, the chances rise dramatically of younger participants reaching the 80 percent pre-retirement income replacement target commonly recommended by many financial experts.
Learn the three key factors related to automatic contribution increases.
continuePlan Sponsors Ask...
Q. We're planning ahead for preparation of the plan's Summary Annual Report. What are the key items that must be included?
Q. We just received our first Qualified Domestic Relations Order. What should we know about who can be an "alternate payee?"
Discover our answers to these questions.
continue
The Mainspring in Motion quarterly newsletter for retirement plan sponsors features market commentary, regulatory and legislative updates, product enhancement announcements and articles on retirement readiness, savings, participant behavior and improving plan effectiveness.
Pension Plan Limitations
for 2011
| Maximum Participant Deferral (for employees who participate in 401(k), 403(b) or 457(b) plans) | $16,500* |
| Defined Contribution Maximum Annual Addition | $49,000 |
| Highly Compensated Employee | $49,000 |
| Annual Compensation Limit | $245,000 |
*$22,000 for those age 50 or over, if plan permits
Plan Sponsor's Quarterly Calendar
Consult your plan's counsel or tax advisor regarding these and other items that may apply to your plan.
January
- Send payroll and employee census data to the plan's recordkeeper for plan-year-end compliance testing (calendar-year plans).
- Audit fourth-quarter payroll and plan deposit dates to ensure compliance with the Department of Labor's rules regarding timely deposit of participant contributions and loan repayments.
- Verify that employees who became eligible for the plan between Oct. 1 and Dec. 31 received and returned an enrollment form. Follow up on forms that were not returned.
February
- Update the plan's ERISA fidelity bond coverage to reflect the plan's assets as of Dec. 31 (calendar-year plans). Remember that if the plan holds employer stock, bond coverage is higher than for non-stock plans.
- Issue a reminder memo or email to all employees to encourage them to review and update, if necessary, their beneficiary designations for all benefit plans by which they are covered.
- Review and revise the roster of all plan fiduciaries and confirm each individual's responsibilities and duties to the plan in writing. Ensure than each fiduciary understands his or her obligations to the plan.
March
- Begin planning for the timely completion and submission of the plan's Form 5500 and, if required, a plan audit (calendar-year plans). Consider, if appropriate, the Department of Labor's small-plan audit waiver requirements.
- Review all outstanding participant plan loans to determine if there are any delinquent payments. Also, confirm that each loan's repayment period and the amount borrowed comply with legal limits.
- Check bulletin boards and display racks to make sure that posters and other plan materials are conspicuously posted and readily available to employees, and that information is complete and current.
