Should 401k Plans Offer Only Index Funds?

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By Robert C. Lawton, President, Lawton Retirement Plan Consultants, LLC

A number of retirement plan experts believe that 401k plan participants should only be allowed to invest in index funds. They say the additional cost that participants pay for actively managed mutual funds is not justified by better performance. Some 401k plan sponsors have agreed, offering only index funds in their fund lineups. Is that a good idea?

Arguments For Using Only Index Funds

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What Your 401k Investment Committee Should Discuss

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By Robert C. Lawton, AIF, CRPS, President, Lawton Retirement Plan Consultants, LLC

If you are like most 401k plan sponsors, you worry about whether your 401k plan investment committee is focused on the right stuff. Is the investment committee using its time wisely talking about what is important? Or do you spend way too much time agonizing about investment performance? I believe that your 401k plan investment committee should focus on reviewing the following at their meetings: [Read more…]

Fiduciary Confusion: What’s A 401k Plan Sponsor To Do?

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By Robert C. Lawton, AIF, CRPS, President, Lawton Retirement Plan Consultants, LLC

On February 3, President Trump signed a memorandum asking the Department of Labor to review the new fiduciary rules that apply to retirement accounts. The next week, on February 9, the Department of Labor (DoL) filed documents that will likely result in a six-month delay of the scheduled April implementation of the rules. There have been a lot of comments circulated on the impact of a delay or any changes. And of course, debate has once again been revived on the value of these new rules. Most important, though, is what this means for your 401k plan and participants and what your 401k fiduciary responsibility is. [Read more…]

How To Avoid A DoL 401k Audit

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By Robert C. Lawton, AIF, CRPS, President, Lawton Retirement Plan Consultants, LLC

There are many reasons for plan sponsors to do everything possible to avoid a Department of Labor (DoL) 401k audit. They can be costly, time-consuming and generally unpleasant.

The DoL in its Fact Sheet for fiscal year 2016 indicates that the Employee Benefits Security Administration (EBSA) closed 2,002 civil investigations with 1,356 of those cases (67.7%) resulting in monetary penalties/additional contributions. The total amount EBSA recovered for Employee Retirement Income Security Act (ERISA) plan participants last year was $777.5 million.

In my experience, if you receive notification from the DoL that it has an interest in looking over your 401k plan, you need to be concerned. Not only do the statistics above support the fact that DoL auditors do a good job of uncovering problems but in my opinion, they are not an easy group to negotiate with to fix deficiencies.

As a result, I believe the best policy to follow to ensure you don’t receive a visit from a DoL representative is to do everything possible to avoid encouraging such a visit. Here are some suggestions that may help you avoid a DoL 401k audit: [Read more…]

Six New Year’s Resolutions 401k Plan Sponsors Should Make

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By Robert C. Lawton, AIF, CRPS, President, Lawton Retirement Plan Consultants, LLC

I hope that 2016 was a great year for you and that 2017 will be even better!

A few changes can make your good 401k plan into a great one. To help your 401k plan achieve greatness, consider making the following 401k plan improvements by year-end: [Read more…]

Why Trump Won’t Roll Back New Fiduciary Regs

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By Robert C. Lawton, AIF, CRPS, President, Lawton Retirement Plan Consultants, LLC

There have been significant differences of opinion on whether President-elect Trump will roll back the new fiduciary regulations set to go into effect on April 10, 2017. These fiduciary regulations, issued by the Department of Labor (DoL), require anyone working with retirement accounts to act as a fiduciary with regard to advice provided. I don’t believe the new Trump administration will cancel or roll back these fiduciary regulations. Here’s why. [Read more…]

How To Hire A 401k Investment Adviser

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By Robert C. Lawton, AIF, CRPS, President, Lawton Retirement Plan Consultants, LLC

Employer plan sponsors often ask me which investment adviser credentials are most important to look for when hiring a 401k investment adviser. As a 401k investment adviser myself, I have observed a number of plan sponsors hiring the wrong advisers because they aren’t looking at the right investment adviser credentials and are using an incorrect set of criteria to judge who is best.

Following are some universal, common sense criteria that plan sponsors can apply when hiring a 401k investment adviser along with important investment adviser credentials to evaluate. The information is divided into what I would consider the three major categories plan sponsors should evaluate: Fiduciary Responsibility, Firm and Background. [Read more…]

Employers, You Should Be Appalled!

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By Robert C. Lawton, AIF, CRPS, President, Lawton Retirement Plan Consultants, LLC

On June 1, 2016 the U.S. Chamber of Commerce, Securities Industry and Financial Markets Association (SIFMA) and the Financial Services Institute and a number of other organizations filed suit against the Department of Labor (DoL) to stop the implementation of the new fiduciary rules.

Why you should be appalled

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What 401k Plan Sponsors Want To Know About The New Fiduciary Regs

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PSI Newsletter and Website Header 10.2.15By Robert C. Lawton, AIF, CRPS, President, Lawton Retirement Plan Consultants, LLC

Since the Department of Labor released its final fiduciary compliance rules, there has been a tremendous amount of media coverage devoted to what plan sponsors need to know about the new fiduciary regs. Although much of it has been well written with good intentions, most of it has been wrong and has only served to confuse plan sponsors. Based on what I am hearing from plan sponsors, following is what you say you want to know about the new fiduciary regs: [Read more…]

New Fiduciary Regs: A Win For Plan Sponsors

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PSI Newsletter and Website Header 10.2.15By Robert C. Lawton, AIF, CRPS, President, Lawton Retirement Plan Consultants, LLC

On Wednesday, April 6, 2016 the Department of Labor (DoL) issued its final fiduciary regs for investment advisors working with retirement accounts. The rules were aimed specifically at brokers who provide investment advice to clients under the “suitability” requirement (which exempted brokers from being fiduciaries). The issuance of these final fiduciary regs ends a long war that the brokerage industry waged against regulators, employing all manner of threats to avoid fiduciary responsibility (e.g.; small clients will not be able to receive investment advice — absolutely ridiculous) and spending millions on intense political lobbying. Who won? Remarkably, plan sponsors!

What is a fiduciary?

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