IPS Advisors April Retirement Report

 

DOL Extends Fiduciary Rule Applicability Date to June 9, 2017
 
The U.S. Department of Labor has announced a 60-day extension of the applicability dates of the fiduciary rule and related exemptions, including the Best Interest Contract Exemption. The announcement follows a Feb. 3, 2017, presidential memorandum which directed the department to examine the fiduciary rule to ensure that it does not adversely affect the ability of Americans to gain access to retirement information and financial advice.
 
Under the terms of the extension, advisers to retirement investors will be treated as fiduciaries and have an obligation to give advice that adheres to "impartial conduct standards" beginning on June 9 rather than on April 10, 2017, as originally scheduled. 
New IRS Audit Guidelines for Safe Harbor Hardship Distributions
 
On February 23, 2017, the Internal Revenue Service ("IRS") notified its field examiners of new guidelines for substantiating hardship withdrawals from 401(k) plans. The new guidelines permit an employer or third-party administrator to obtain and rely upon a "summary" (via email, paper copy or telephone records) of information supporting the safe harbor distribution. Previously, the IRS required that the employer maintain financial information and documentation substantiating the employee's immediate and heavy financial need. The new guidelines will ease recordkeeping for safe harbor hardship withdrawals, provided that the employer or third-party administrator provides a specific employee notification before making the distribution. 
 
Plan sponsors should take this opportunity to review their hardship distributions procedures to determine if changes should be made, such as limiting hardship withdrawals to the IRS safe harbors, expanding the group of persons on whose behalf a hardship distribution may be made to include primary beneficiaries, or limiting the number of hardship distributions that may be taken during a plan year. If you need assistance, please contact your IPS Advisors consultant or email us at ipsadvisors@ipsadvisors.com.  
Stressed Out: 2017 Retirement Confidence Survey
 
Many American workers today are feeling stressed about retirement and are not taking steps to prepare for it. And those feeling stressed have lower levels of retirement confidence and are less likely to feel financially secure, according to the 2017 Retirement Confidence Survey (RCS) by the nonpartisan Employee Benefit Research Institute (EBRI) and Greenwald & Associates. This is the 27th annual RCS, the longest-running survey of its kind in the nation, canvassing both current workers and retirees. 

This year's RCS finds that 3 in 10 workers report that they feel mentally or emotionally stressed about preparing for retirement. In addition, another 3 in 10 say that they worry about their personal finances while at work (30 percent). Half of these workers believe they would be more productive at work if they didn't spend time worrying. Among all workers, about half say that retirement planning (52 percent), financial planning (49 percent), or healthcare planning (47 percent) programs would be helpful in increasing their productivity. Yet, many workers are not taking critical retirement-planning steps. Six in 10 workers (61 percent) say they have saved for retirement. Just 4 in 10 have tried to figure out how much money they will need in retirement (41 percent). Continue reading at www.ebri.org
Compliance Calendar Reminders
 
April 3: Required beginning date for Minimum Required Distributions (MRDs).
 
April 14: Deadline for corrective distributions for excess deferrals.
 
April 17: Deadline for filing individual and/or partnership tax returns and contribution deadline for deductibility for unincorporated entities (without extension). Deadline for requesting automatic extension (to October 16) of individual and partnership tax returns.
Upcoming Industry Events
 
IPS Advisors looks forward to seeing many of you out in the field this spring! 
 
Government Finance Officers Association of Texas (GFOAT) Spring Institute
April 9-11, Austin
 
Association for Advanced Life Underwriting (AALU) Annual Meeting
April 30-May 2, Washington, D.C.
 
Plan Sponsor Council of America (PSCA) 70th Annual National Conference
May 2-3, Chicago
 
Texas Municipal Human Resources Association (TMHRA) Annual Conference
May 3-5, Austin
 
Pensions&Investments 401(k)/403(b) Investment Lineup Conference
May 11, Dallas
 
42nd Annual SouthWest Benefits Association Conference
May 24-26, Houston
 
Additionally, IPS Advisors is sponsoring two local fundraising events this month. Special appreciation goes to our Managing Partners, Randall Martell and Rod Sager, respectively, for their involvement in these two organizations:
 
JDRF Greater Dallas Dream Gala // April 8, Omni Hotel (Dallas)
Big Thought "Big Night" // April 29, Granada Theater (Dallas)
Employee Communication Corner: Test Your Retirement IQ
 
This month's employee memo quizzes plan participants on five important retirement facts.
 
Click here to access the memo and share with your employees.  
If you have questions, please contact your dedicated IPS Advisors Employee Benefit Specialist, or contact one of our Retirement Plan Consultants below:
 
Tim Thurston, AIF®
Manager, Retirement Plan Services
(214) 443-2410
Tammy Woodman, QKA, AAMS®
Defined Contribution Consultant
(214) 292-4123

 

Click here for the print version of this newsletter. 

The information provided is for educational purposes only. This information is from sources we believe to be reliable, but we cannot guarantee or represent that it is accurate or complete. The opinions are those of the writer, and the opinions and information presented are subject to change without notice.

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