Jessica Crowley used to dwell on an unpleasant thought. When her children began college, she'd still be repaying her own student loans. But a few months ago, the company where she works announced a new benefit: student loan assistance. Now, New York Air Brake, which makes train control systems, pays Crowley $166 a month toward her student loan balance, which means she'll be debt-free sooner than she thought. "It's going to shorten my loan life by a couple of years," Crowley, 30, said. "It's going to be a big difference." PepsiCo to Buy SodaStream for $3.2 Billion Student loan assistance, which started as a niche offering by a handful of companies, is finding its way into the mainstream menu of workplace benefits. "This is certainly emerging as a new and very important benefit," said David Pratt, a professor at Albany Law School who studies employee benefits. This year, Fidelity began to offer businesses a way to contribute to their workers' … [Read more...] about Student Loan Assistance May Become as Popular as 401(k) Plans
Massmutual 401k loan
In Golden Star Inc. v. MassMutual Life Ins. Co., 2014 WL 2117511 (D. Mass. May 20, 2014), a district court addressed two issues that have become hotly contested in 401(k) plan fee litigation: (1) whether and when a plan provider’s possession or exercise of discretion over fees confers fiduciary status; and (2) whether, to be a fiduciary with respect to plan investments, a plan provider must not only possess, but actually exercise discretion over the investment options offered by the plan.MassMutual offered plaintiff Golden Star (the plan sponsor and named fiduciary) recordkeeping and other services for its 401(K) plan. MassMutual defined the menu of investment options offered, and Golden Star selected the options to be offered in its plan from that menu. The mechanism for these investments was separate accounts owned by MassMutual as an insurer; MassMutual would pool the investments of several 401(K) plans investments into these separate accounts and then invest the accounts … [Read more...] about The Debate Continues Over The Fiduciary Status of 401(k) Plan Service Providers
For the last few weeks, U.S. tax reform deliberations put 401(k) retirement plans on a roller coaster ride. Rumors abounded, including, for example, whether legislators would impose new contribution caps, or eliminate pre-tax contributions altogether. Legislators often have targeted the tax-advantaged status of retirement savings plans as a revenue raiser to pay for federal programs and competing tax breaks. The House Republicans’ release of the Tax Cuts and Jobs Act (the “Act”) on November 2 appears to have stopped the roller coaster – at least temporarily.The Ways and Means Committee is touting that the “bill retains the popular retirement savings options – such as 401(k)s and Individual Retirement Accounts – as Americans know them today.” This is clearly the case. However, claims that there are no changes to 401(k) or other retirement savings plans are not quite accurate. While the current … [Read more...] about U.S. tax reform – 401(k) plans saved from the chopping block?
An investment analyst is advising against overreactive responses to Democratic presidential candidates' goals on "Medicare for All" and doing away with private healthcare because you cannot know what the true market response will be, if it ever even comes to it. "Many investors are nervous, fearing fallout for healthcare stocks," Ken Fisher of Fisher Investments wrote in the USA Today. "But it's too early to fear (or cheer) this — or any policy proposals that flash-forward this year. Slow down." Fisher's warning came in an analytics piece headlined "Is 'Medicare for All' a health hazard for stocks in your 401(k)?" "Setting aside all political views, if Medicare for All passed, health insurance and hospital stocks likely would suffer," Fisher wrote. "Possibly drug and medical device makers would too, although they are more insulated. Even if legislation doesn't pass, a heated debate could hurt sentiment, sparking volatility in these stocks. But you shouldn't think that … [Read more...] about Ken Fisher: ‘Too Early to Fear (or Cheer)’ Dem Policies
The deposit timing rules are relatively straightforward, or so we thought…Just a few weeks ago, a client asked us for assistance in completing the 401(k) recordkeeper’s 2014 Form 5500 data questionnaire. As expected, the questionnaire asked whether there were any employee contributions that were not deposited on-time. We were very surprised to see the questionnaire go on to incorrectly state the deposit timing rule. The recordkeeper was incorrectly advising its clients, in writing, that the deposit deadline can be extended to the 15th business day of the month following the withholding. This is an old myth, and one we thought had been universally debunked years ago.U.S. Department of Labor (DOL) regulations clearly require the employer to deposit employee deferrals and loan payments in the 401(k) plan trust on the earliest date those amounts can reasonably be segregated from the employer’s assets. In other words, the employer must deposit employee … [Read more...] about Is Your Company Making Timely 401(K) Contributions?