Is Your 401(k) Up To Par?

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The quality of 401(k) plans offered needs to improve or plan participants will leave the plan. These plans need to convert to a more pension fund like approach.

Here are some of the other key design features and the percent of plans surveyed with that feature, according to the IRS survey:No age requirement to sign up (20%)

No service requirement (minimum time on the job) needed to make contributions (13%)

Employees can change deferral elections at any time (41%)

Catch-up contributions allowed for employees at age 50 (96%)

Employer matching contributions program in place (68%)

Permit after-tax contributions (4%)

Hardship distributions permitted (76%)

Employee loans permitted (65%)

For a look at the “crucial” role that 401(k) plans will play in the future of Americans’ retirement readiness, check out this speech The Investment Company Institute President/CEO Paul Stevens gave earlier this month at Town Hall Los Angeles.

The 401(k) plan has become the sole source of retirement of most Americans. If plan sponsors do not take their 401(k) plan seriously someone else will.

Please comment or call to discuss how this affects you and your company sponsored retirement plan.

Posted via email from Curated 401k Plan Content

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Families That Cheat Investors Together, Stay Together

Financial author William Bernstein said it best: “…there is a third type of investor – the investment professional, who indeed knows that he or she doesn’t know, but whose livelihood depends upon appearing to know.”

Actually, there is a fourth type of “investment professional.” They definitely know they don’t know. They make a living conning you out of your money by offering you the lure of outsized returns without meaningful risk. Their con is more blatant and despicable than the conduct of your typical retail broker, but both have the same goal: Enriching themselves at your expense.

The debate on the fiduciary standard for all recommending investments will continue because many in the financial industry benefit fro the conflicts of interest. Investors must come first if we are to regain the trust of the American public. There is a successful business model which puts the interest of the investor first.

Please comment or call to discuss.

Posted via email from Curated 401k Plan Content

Are You Ready for a DOL Audit? 401(k) and Pensions Plans are in the Crosshairs

A recent report of U.S. Department of Labor (DOL) audit results contained some surprising statistics: almost 3 out of 4 audits find violations of the Employee Retirement Income Security Act of 1974 (ERISA) and the average cost for a plan to correct them, including fines and penalties, is $450,000. The DOL’s ERISA audit force will expand to include over 1000 investigators and audit activity will be increasing.

Plan administrators often prepare for IRS audits by doing their own plan compliance audits to identify problems to correct. However, we hear less frequently about clients preparing for a possible DOL audit, even though these audits are becoming more common. DOL audits could be triggered by answers on Form 5500 or employee complaints, or be the result of random selection.

Many plan sponsors have been busy managing their business, with little time for their company retirement plan. As regulations continue to increase and DOL audits increasing now is not the time to ignore this important employee benefit.

Please comment or call to discuss.

The End of Human Resources as We Know It

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The competition for skilled employees will continue to challenge growing companies. Talent will find top organizations.

HR can’t be well managed without thoughtful criteria for assessing talent. The best HR leaders today are doing the math.A New Kind of HR Leader

The rise of the CHRO — Chief HR Officers, participating in the highest levels of decision-making — confirms the seriousness of boards of directors in elevating the role and capabilities of HR leadership. While historically CHROs were added to boards as a way to add diversity, companies in recent years have begun to add top-notch CHROs to broaden their perspective on organizational issues and expertise in talent matters.

The trend has accelerated this year and will continue to do so.

The pressures in this new HR world are enormous. A few of the current crop of HR superstars — Kevin Cox of American Express, Laszlo Bock of Google, Jeff Smith of BlackRock, Tracy Keoch of HP, Matt Schuyler of Hilton Hotels, Ashley Goldsmith of Polycom — are carrying the weight of their organizations on their shoulders.

Leaders like these won’t be caught short when asked for a realistic assessment of their organizations’ critical assets.

The best HR leaders welcome the challenge and in the process are strengthening the role of HR. They understand that talent is the competitive edge and the core of any organization — and that talent development is the most important responsibility of their job.

Organizations will find attracting and retaining top talent their main challenge going forward. This, I believe, is relevant to all organizations looking for skilled employees.

Please comment or call to discuss.

  • Vice President, Human Resources (
  • Senior Vice President, Talent Management Director (
  • Assessing the Real Value of ‘Me’ (
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Worker morale still needs a boost

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Talk is not cheap

Perhaps the most important thing you can do to help morale is “acknowledging the stresses and circumstances that your employees are feeling,” says Arlene Vernon, president of HRx Inc, an Eden Prairie, Minn.-based HR consultancy.

That may sound familiar, because it’s the sort of advice consultants were giving out during the financial crisis. They suggested company owners walk around the office, factory or selling floor and talk to workers. Ask them how things are going. Listen to them vent about the economy. See if they have questions about the company.

These chats may not seem important, but they do go a long way toward helping employees feel better. If workers have to sit on their feelings and just put on a bright face all the time, they’re just bottling up unhappiness and that can be a big morale-buster.

Employees also need to feel that they’re really being listened to, not patronized. That means you need to take in what your workers are saying, and if they are upset about their jobs, see what the problem is and what you can do to help.


Your employees are your most valuable asset.

Please comment or call to discuss.

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Can poor people retire?

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This problem can be solved by proper education. Potential employees must realize that they will not be hired without the proper skills. On the job training is becoming a thing of the past.

the nation is experiencing a skilled worker shortage. Stories in the past week show an interesting trend in hiring – that the real problem with unemployment might not be a lack of jobs [See Businesses post most job openings in 3 years], but that employers won’t hire people who lack the qualifications. Which relates to the fact that lower-skilled adults ages 18 to 34 have had the largest jumps in poverty. [See also: Unemployment crisis: Can’t find jobs or can’t find talent?] So what does all this have to do with retirement plans? It means possibly that the next big wave of retirees will be so broke, they either won’t be able to quit working, or they’ll be living off Social Security‘s dwindling revenue. And that the cash power for Gen Y might be segregated to cohorts who are part of the greatest wealth transfer in history, an estimated $41 trillion by 2052, according to Boston College’s Center on Wealth and Philanthropy.


Is the fundamental employment problem a lack of training or a lack of potential employees desire to learn the necessary skills.

Please comment or call to discuss.

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Press Release

Internal Revenue Service (IRS)
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401K Plan Advisors LLC is Proud to announce that Tony
Krance, MBA, CFP®, AIF®, ERPA has been awarded the designation of Enrolled
Retirement Plan Agent (ERPA) by the Internal Revenue Service.  This enrollment allows Mr. Krance to
represent taxpayers before the Internal Revenue Service concerning the
following qualified retirement plan issues:

  • IRS/DOL audit representation
  • Employee Plan Compliance Resolution Program
  • Employee plan determination letters
  • Form 5500 and 5300 representation

The ERPA designation reflects Tony Krance’s commitment to
providing the expertise to their clients necessary in this increasingly complex
regulatory environment.

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401(k) rip-offs: How to protect yourself

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The 401k was first established as a supplement to pension plans. It is now the primary resource for most Americans to successfully retire. We must begin to treat them as such.

There may be larcenous gremlins in your 401(k) eating your retirement money. They aren’t easy to identify and are often buried in plan documents. You will need a trained professional to exterminate them.Many of the biggest 401(k) money-eaters escape the notice of your employer, who is legally obligated to ferret them out. Your company may have bought 401(k) services from middlemen who suck up your money in the form of commissions, administrative or management fees.

How do you know if your money is being siphoned off? In many cases, you will never know, nor will your employer take the time to audit your plan to get rid of the worst abuses.

The U.S. Department of Labor is working on new rules that would make money managers connected to retirement plans fiduciaries. That would set a higher standard that would put your interests first.

The money trust is vigorously opposing these guidelines, which could potentially eliminate or curtail some of the worst skimming practices. Yet that may not have much impact if the Labor Department does little or no enforcement, which has been the case in the past.


Wall Street has used the 401(k) plans as a cash cow. It may be time to stop this and put more money in the accounts of the participants. Unless of course you believe Wall Street can use the money.

Please comment or call to discuss how benchmarking your plan would benefit you and your participants.

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ERISA §3(38) Fiduciaries and the Flavor of the Month

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There are many service providers touting fiduciary warranties and risk management. However, there is only one way to transfer the responsibility and liability to an expert. That is for the service provider to sign an agreement, covering all funds in the plan, specifying they will accept the ERISA 3(38) investment manager duties.

One of the most positive developments in the retirement plan business is the proliferation of independent ERISA §3(38) fiduciaries. While the §3(38) defined investment manager has been in ERISA since the beginning in 1974, there has been a dramatic increase in the number of registered investment advisors offering this option to their clients.The uniqueness of the §3(38) proposition is that the §3(38) fiduciary has discretionary authority, assuming the liability of the fiduciary process from the plan sponsor. It’s a nice proposition because many 401(k) plan sponsors don’t do a job of handling it on their own or with the help of a financial advisor. Development of an investment policy statement (IPS), selection and review of investment options based on that IPS, and offering education to participants for participant directed plans isn’t an easy task. Please note that the hiring of an ERISA §3(38) is a fiduciary function, so plan sponsors may be on the hook if they hire a poor §3(38) fiduciary.

Many retirement plan advisers will profess to be accountable for the fund selection in your plan. However unless the adviser agrees in writing to be the ERISA 3(38) investment manager to the entire plan, there is no relieve for the plan sponsor. The plan sponsor holds all the responsibilities for the fund in their plan.

Please comment or call to discuss how this affects you and your company.

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