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Employee Benefit Security Administration–Protector of Your Pension Benefits–Recovers Nearly $1.4 Billion in Pension and Other Employee Benefits in FY 2024

Employee Benefit Security Administration–Protector of Your Pension Benefits–Recovers Nearly $1.4 Billion in Pension and Other Employee Benefits in FY 2024

The Employee Benefit Security Administration (EBSA) is an agency within the U.S. Department of Labor (DOL) charged with ensuring the integrity of our nation’s private employee benefit plan system by enforcing the Employee Retirement Income Security Act (ERISA). EBSA currently oversees approximately 801,000 pension plans and three million welfare plans which collectively hold $14 TRILLION in assets and cover 156 million workers, retirees, and their dependents. EBSA has been highly successful in fulfilling its statutory duty of protecting workers’ employer-…

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Are Your Contributions to Your 401(k) Plan Protected From Creditors in a Bankruptcy Proceeding?

Are Your Contributions to Your 401(k) Plan Protected From Creditors in a Bankruptcy Proceeding?

The answer depends. But, here’s how the Sixth Circuit Court of Appeals answered that question in Davis v. Helbling (In re Davis), No. 19-3117, 2020 U.S. App. LEXIS 17223 (6th Cir. June 1, 2020). In 2017, Camille Davis filed a bankruptcy petition under Chapter 13 of the U.S. Bankruptcy Code. Chapter 13 gives individuals with a regular source of income the opportunity to propose a plan of repayment to their creditors while under the bankruptcy court’s protection. When Davis filed…

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An Idea Whose Time Has Come: A National “Lost and Found” for Retirement Accounts

An Idea Whose Time Has Come: A National “Lost and Found” for Retirement Accounts

As explained in my prior Post, each year millions of Americans lose thousands of dollars in retirement savings in the process of changing jobs. The problem largely results from employers shifting from defined benefit plans that pay an annuity for life to defined contribution plans, like 401(k) plans, that pay a lump sum upon separation from employment or at a later date when the participant elects to take his/her lump sum. If a separated participant chooses to leave the lump…

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It’s High Time to Do-Away With the “Arbitrary and Capricious” Standard of Review for Employee Benefit Claims

It’s High Time to Do-Away With the “Arbitrary and Capricious” Standard of Review for Employee Benefit Claims

The Employee Retirement Security Act (ERISA) has long-required that employee benefit plans (e.g., pension and welfare plans) provide “a full and fair review” of any decision denying a participant’s claim for benefits. ERISA §503, 29 U.S.C. §1133. Accordingly, most employee benefit plans provide procedures for submitting a claim for benefits to the plan administrator and for requesting a review of any denial of the claim. Often, the merits of a participant’s claim will turn on the interpretation of disputed plan…

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Growing Trend: Employers Are “De-Risking” Their Pension Plans Through the Purchase of Group Annuity Contracts

Growing Trend: Employers Are “De-Risking” Their Pension Plans Through the Purchase of Group Annuity Contracts

The past five years have seen a growing trend among sponsors of single-employer defined-benefit plans: They are “de-risking” their pension plans by transferring all or a portion of their pension obligations to a life insurance company through the purchase of a group annuity contract. Thereafter, the life insurance company is responsible for paying retirees’ pension benefits. The arrangement is appealing to plan sponsors because it enables them to reduce the risks of funding their pension obligations in a volatile asset…

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The Secure Act- What Would It Mean To Retirement?

The Secure Act- What Would It Mean To Retirement?

The House of Representatives passed the Setting Every Community Up for Retirement Enhancement Act of 2019 (the “SECURE Act”). The SECURE Act is now in the hands of the Senate. If the Senate and President approve, the following are some of the key provisions that could impact individuals and businesses when it comes to retirement planning: · After the death of a participant in a retirement plan or owner of an IRA (or Roth IRA), distributions of the entire account…

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Does It Make Sense to Delay Collecting Social Security Retirement Benefits in Order to Receive a Higher Monthly Benefit?

Does It Make Sense to Delay Collecting Social Security Retirement Benefits in Order to Receive a Higher Monthly Benefit?

First, if you qualify for Social Security retirement benefits (SS benefits), you may choose to start receiving them between age 62 and age 70. However, if you start your SS benefits before your full retirement age (FRA), they will be reduced; if you wait until age 70, they will be increased. Your FRA depends on the year you were born; it is age 66 if your birth year was 1943-1954; it is age 67 if your birth year is 1960…

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One More Thing to Worry About in Retirement: the Solvency of Medicare’s Hospital Insurance Trust Fund [Medicare Part A]

One More Thing to Worry About in Retirement: the Solvency of Medicare’s Hospital Insurance Trust Fund [Medicare Part A]

On June 5, 2018, Medicare’s Board of Trustees issued its annual report on the state of its two trust funds: the Hospital Insurance Trust Fund (Hospital Fund) and the Supplementary Medical Insurance Trust Fund (Supplementary Fund). The Hospital Fund, known as Medicare Part A, helps pay for hospital stays, home health services following a hospital stay, care in a skilled nursing facility, and hospice care the aged and disabled. The Hospital Fund is financed by taxes on workers’ earnings. Thus,…

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Women Face More Obstacles Than Men In Achieving Retirement Security

Women Face More Obstacles Than Men In Achieving Retirement Security

Women face more obstacles than men in achieving a financially secure retirement. That’s the conclusion of a recent report based on an online survey of 6,372 workers conducted by the Harris Poll between August and October 2017 for TransAmerican Retirement Studies. [See “Here and Now: How Women Can Take Control of Their Retirement” by TransAmerica Retirement Studies]. For starters, women earn only 80.5% of the salary of men. They are also more likely to work part-time and to take time…

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Retirement Expectations Versus Retirement Realities. There’s a large and troubling gap between the two

Retirement Expectations Versus Retirement Realities. There’s a large and troubling gap between the two

There exists a large and troubling gap between retirement expectations and retirement realities, according to the results of a recent online survey conducted by the Harris Poll on behalf of Prudential Insurance. [See “Planning Your Retirement? Expect the Unexpected” by Salene Hitchcock-Gear, Pres. Prudential Advisors] For starters, the average anticipated retirement age of pre-retirees was 65, while the actual retirement age of retirees was age 59–a six-year gap which is expected to widen into the future. Moreover, approximately half (51%)…

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