1. 2016 RETIREMENT PLAN UPDATES / TRENDS
Presented by: Brad Wexler, MBA, QPA, QKA, CPFA
Tycor Benefit Administrators, Inc.®
(610)
Securities offered through Kestra Investment Services, LLC (Kestra IS), member FINRA/SIPC. Investment advisory services offered through Kestra Advisory Services, LLC (Kestra AS), an affiliate of Kestra IS. Kestra IS and Kestra AS are not affiliated with Tycor Benefit Administrators, Inc.® or Tycor Asset Management, Inc.® 9/16

2. Agenda Department of Labor Conflicts of Interest Rule
Litigation Trends
Proposed Changes to Form 5500
Capturing the Young Saver
QDIA / Evaluating Target Date Investment Structure
Alternative Plan Designs

3. DOL Conflicts of Interest Rule
The most notable change in 2016
Increased responsibility for trustees / plan sponsors
Revised definition of “Fiduciary”
Revised the activities that are excluded from the definition of advice
Created the Best Interest Contract Exemption (BICE)
New agreements and disclosures
Education vs. Advice

4. Litigation Trends Increased litigation due to excessive fees
Increased responsibility for plan sponsors to value / document services
DOL/IRS moving down-market toward smaller plans
Increasing civil monetary penalties to retirement plans / sponsors
Selecting your auditor (if over 100 employees)

5. Proposed Changes to Form 5500
Will have significant impact on retirement plan sponsors.
Previously, an information return.
Proposal will supply key components for DOL, IRS and PBGC.
Will lead to more plan audits.
Key Areas- Timely 401(k) Deposits, Fee disclosures, required minimum distributions, hardship distributions.
To go into effect gradually, between 2016 plan year and 2019 play year.

6. Capturing the Young Saver
Generation “Y” (age 40 or younger) - Least engaged employees with regard to retirement.
Will be first generation to have 401(k) accounts for their entire working career.
55% have not started saving; 64% do not think about retirement*.
Uncertainty related to Social Security/Medicare; increasing life expectancies.
Must improve retirement readiness among the young saver.
Raise participation.
Automatic Enrollment – ‘path of least resistance’.
Automatic Escalation.
*2012 Forbes Magazine

7. QDIA / Evaluating Target Date Investment Structure
QDIA-Qualified Default Investment Alternative
Used with Auto Enrollment/Auto Escalation
Target Date Investments (TDI) most popular QDIA
48% of 401(k) participants in TDI as of 2014 (expected to be around 85% as of 2019)*
Not all TDIs the same; plan sponsor responsible for evaluating them
Investment Management Firm
*April 2016 Employee Benefit Research Institute

8. QDIA / Evaluating Target Date Investment Structure (Cont’d)
Equity Glide Path
To vs. Through Retirement
Asset Class Selection
Investment Management Implementation
Investment Costs
Customized TDI

9. Alternative Plan Design “The Cash Balance Plan”
IRS-qualified (tax-favored) retirement plan that combines the high contribution amounts of a defined benefit plan that looks and feels like a 401(k) plan.
Participant accounts grow annually via employer contribution and interest crediting rate (ICR).
ICR benchmarked to 30-year Treasury Rate or flat rate between 4%-6%.
Should be used in conjunction with 401(k) plan.
Allows owners to squeeze 20+ years of savings in 10 years.

10. Questions

11. 850 Cassatt Road, Suite 310 Berwyn, PA 19312 610.251.0670
Tycor Benefit Administrators, Inc.®
Confidence in your plan ™
For More Information
Call
Brad Wexler
850 Cassatt Road, Suite Berwyn, PA
Securities offered through Kestra Investment Services, LLC (Kestra IS), member FINRA/SIPC. Investment advisory services offered through Kestra Advisory Services, LLC (Kestra AS), an affiliate of Kestra IS. Kestra IS and Kestra AS are not affiliated with Tycor Benefit Administrators, Inc.® or Tycor Asset Management, Inc.® 9/16