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Retirement Income and Rollovers |
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| IRA Rollovers and Level Fees |
| The DOL fiduciary rule does not impact the ongoing discretionary investment management services provided to the IRA. Those are fiduciary services under the Internal Revenue Code, are not subject to a DOL fiduciary standard of conduct, and do not constitute a prohibited transaction, because you charge a level fee. On the other hand, the rollover recommendation is a fiduciary act under the DOL rules and is subject to the Employee Retirement Income Security Act standard of conduct. Also, in most instances, the rollover recommendation will result in a PT for which an exemption such as the best interest contract exemption is needed.
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| Annuities in DC Plans |
| Creating a retirement income stream from savings is, in many ways, the most complicated part of working with one’s retirement plan. Studies have shown that people like the idea of a steady income stream but are unaware of the products—specifically annuities that they can purchase to help them attain that. As plan sponsors consider their options to give plan participants access to annuities through the company plan, advisers are in a position to explain the “how”s and “why”s.
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| Retirement Income Options Over Time |
| Some retirement plan sponsors may be waiting for the Department of Labor (DOL) to issue additional safe harbor provisions for retirement income products. Yet, comparing the 2016 PLANSPONSOR Defined Contribution (DC) Survey with the 2015 edition shows a slight uptick, at least among plans with $50 million of assets or more, in the use of in-plan products that guarantee monthly income.
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| Brand Trust Dominates IRA Rollover Decision |
| Fees are often thought of as the prevailing factor in most retirement investment decisions, but new research suggests the destination of an IRA rollover is determined by more subtle considerations.
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| Retirement Income Language Barrier Remains a Problem |
| Despite the generally positive perceptions of the benefits of guaranteed lifetime income, only one in four survey respondents age 45 and up plan to purchase an annuity.
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| Measuring Retirement Income Adequacy Not An Exact Science |
| Researchers have developed diverse approaches for quantifying the adequacy of retirement income, focusing on different groups of retirees and employing different definitions of income and adequacy, a CBO report notes.
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