Take a Closer Look at Your 401(a) and 457(b) Plans When You Change Providers

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By Jeff Chang

Previously, we have discussed a number of the do’s and don’ts of switching plan providers, such as investment advisors and recordkeepers. This post focuses on why plan sponsors, plan administrators and plan recordkeepers all should take greater care in reviewing plan documents as part of the process of switching from one recordkeeper to another.

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Posted in 401(a), 457(b) Plans, Governmental plans, Plan Administration, Plan Qualification, record-keeping | Tagged , , | Leave a comment

Managing Your Agency’s CalPERS Pension Liabilities

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By Jeff Chang

Municipal and special district employers, particularly their elected council and board members, continue to express concerns over the size of their agencies’ CalPERS “liabilities” and what can be done to mitigate them. Although there are several strategies to address pension liabilities, the proper approach or strategy may depend on whether you are more concerned with overall unfunded accrued liability (UAL) or whether your agency can afford its increasing, minimum required employer contribution (Required Contribution). Continue reading

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Posted in Governmental Retirement, Pension | Tagged , , , , | Leave a comment

Is Your 457(b) or 401(a) Plan Fee Allocation Fair and Reasonable?

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By Jeff Chang

Investment fiduciaries and plan administrators of California public sector 457(b) and 401(a) plans are required by law to act as “prudent experts” for the sole and exclusive purpose of providing benefits and defraying “reasonable expenses” of administering the plan. We believe that these duties should cause plan fiduciaries to look beyond whether their plan investment fees and plan recordkeeping fees are reasonable in the aggregate – at the plan level. If you take a closer look at the various types of plan fees (and what they represent), you may decide that the current manner in which your plan “spreads” or allocates these fees no longer makes sense or no longer seems fair.

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Posted in 401(a), 457(b) Plans, fiduciary, Governmental plans, Investments, Plan Administration, record-keeping, Retirement Plan Fees | Tagged , , | Comments Off on Is Your 457(b) or 401(a) Plan Fee Allocation Fair and Reasonable?

What Participant-Level Records Should Your Governmental 401(a) or 457(b) Plan Keep?

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By Jeff Chang

In earlier posts, we discussed the plan documents you should keep as well as some of the policies and procedures you will need to properly maintain and administer your governmental 401(a) or 457(b) plan. This post discusses the participant-level records that you may need to keep in order to determine the benefits due, or which may become due, to plan participants, their spouses, beneficiaries, and alternate payees. Although governmental plans generally are not subject to ERISA, the inclusion of ERISA-like fiduciary duties and responsibilities in authorities such as the California Constitution, definitely make the guidance and rules promulgated by the U.S. Department of Labor (DOL) relevant to California’s public sector plans.

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Posted in 401(a), 457(b) Plans, Governmental Retirement, Missing Participants, Plan Administration, record-keeping | Tagged , | Comments Off on What Participant-Level Records Should Your Governmental 401(a) or 457(b) Plan Keep?

Is Your Social Security Replacement Plan Up to Snuff?

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By Jeff Chang

As we previously explained, most public agencies are not automatically subject to Social Security. They have a choice between voluntarily participating in Social Security pursuant to a section 218 agreement, or they can exempt some or all of their payroll by providing what is known as a “Social Security Replacement Plan” (SSRP).

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Posted in 401(a), 457(b) Plans, Governmental plans, Plan Administration, record-keeping, Social Security Administration | Tagged , , | Comments Off on Is Your Social Security Replacement Plan Up to Snuff?