| Sponsored message from PLANADVISER |
| The U.S. House and Senate have passed a bipartisan appropriations package. Folded into the sweeping legislation are virtually all of the provisions of the Setting Every Community Up for Retirement Security Act (SECURE Act), including a laundry list of popular proposals aimed at expanding and modernizing the defined contribution retirement plan system. In this special edition newsletter, readers can find in-depth coverage of the SECURE Act’s most important elements, from “open MEPs” to an annuity selection safe harbor for plan fiduciaries.
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| Simplification to Encourage Retirement Benefits |
| The SECURE Act provides nondiscrimination testing relief for pension plans still providing valuable retirement benefits to long-tenured employees; more time to adopt retirement plans, allowing employers more flexibility to offer plans at start up or during a transition; and consolidated Form 5500 filings for similar plans with the same investments and fiduciaries, which is particularly relevant to achieving economies of scale for plans that are not part of a MEP.
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| Assessing the Open MEP Opportunity |
| Lower-priced 401(k) options have become available, so open MEPs or PEPs will need to be priced competitively to penetrate the small business market. The SECURE Act sweetens the deal for employers by offering tax incentives for businesses opening new plans and for businesses with plans that add auto-enrollment.
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| Who Will Distribute Open MEPs? |
| For retirement plan advisers, passage of open MEP legislation could change relationships with plan sponsors and providers, as well as create the need for new distribution models.
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| Market Mirror |
| Wednesday, the Dow was down 27.88 points (0.10%) at 28,239.28, the NASDAQ increased 4.38 points (0.05%) to 8,827.74, and the S&P 500 slipped 1.38 points (0.04%) to 3,191.14. The Russell 2000 closed 4.17 points (0.25%) higher at 1,661.73, and the Wilshire 5000 was up 4.69 points (0.01%) at 32,508.38.
The price of the 10-year Treasury note was down 4/32, increasing its yield to 1.928%. The price of the 30-year Treasury bond fell 1 2/32, bringing its yield up to 2.363%.
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