Tag: IRA

DOL Can’t Put Fiduciary Duty on IRAs, Ex-Labor Official Testifies

Mary Pat Campbell

Link: https://www.thinkadvisor.com/2024/01/10/dol-cant-put-fiduciary-duty-on-iras-ex-labor-official-testifies/

Excerpt:

The Labor Department lacks the legal authority to promulgate its new fiduciary rule, Brad Campbell, partner at Faegre Drinker, and former head of Labor’s Employee Benefits Security Administration, told House lawmakers Wednesday.

During testimony before the House Financial Services Capital Markets Subcommittee, Campbell maintained that the department “doesn’t have the legal authority to do what it is trying to do” because it cannot impose a fiduciary duty as it relates to individual retirement accounts.

“The reason we are here today is that the Proposals go well beyond DOL’s limited authority,” Campbell told lawmakers.

Labor’s plan ”would make DOL the primary financial regulator of $26 trillion, approximately half of which is held by individuals” in IRAs rather than employer-provided plans.

If Labor’s proposals “were limited to redefining fiduciary advice within the department’s actual authority — which is to administer the fiduciary standard expressly created by Congress to regulate employee benefit plans sponsored by private sector employers under Title I of ERISA — we wouldn’t be here today,” Campbell opined.

Author(s): Melanie Waddell

Publication Date: 10 Jan 2024

Publication Site: Think Advisor

ASPPA 2021 Conference: Day 1

Mary Pat Campbell

Link:https://burypensions.wordpress.com/2021/10/17/asppa-2021-conference-day-1/

Excerpt:

General Session 1: Washington Update

per Brian Graff who has spent 25 years at ASPPA and got some recognition for it at the end of this session.

….

Hispanic and Black coverage in 401(k) plans is low and if this situation it does not improve private sector plans could be eliminated in favor of a government option as in Australia. States (first Oregon, then CA, and 8 others) are setting up their own plans and forcing companies to be in it if they don’t have their own plans. This is good for us in that companies do not want to give their money to states (especially in CA and NJ) so they set up their own plans that need to administered by us.

Proposal that may be effective in 2023 is requiring all companies with at least six employees in the last two years to set up a 401(k) plan with auto-enrollment at 6% going up to 10%. Pie would increase by 62 million participants (from 95 million now) and 600,000 plans (on top of 800,000 now).

Author(s): John Bury

Publication Date: 17 Oct 2021

Publication Site: burypensions

House Panel Votes to Rein in Large Retirement Account Balances

Mary Pat Campbell

Link: https://www.asppa.org/news/browse-topics/house-panel-votes-rein-large-retirement-account-balances

Excerpt:

Mega-Roth, backdoor IRAs and large retirement account balances would be limited under legislation approved Sept. 15 by the House Ways and Means Committee.

In a near party-line vote of 24-19, the changes were approved as part of the $3.5 trillion Build Back Better Act reconciliation recommendations that address everything from implementing infrastructure development and green energy incentives, to expanding Medicare, offering paid family and medical leave, and extending Trade Adjustment Assistance. 

….

These revenue-raising retirement proposals are included in Subtitle I, “Responsibly Funding Our Priorities,” along with a host of other individual and corporate tax increases. The Joint Committee on Taxation estimates that these tax changes would raise approximately $2.1 trillion over 10 years to help pay for the fiscal year 2022 budget reconciliation bill. (For a more detailed description of the retirement-based revenue proposals, click here.)

Author(s): Ted Godbout

Publication Date: 16 Sept 2021

Publication Site: American Society of Pension Professionals & Actuaries

Visualizing U.S. Stock Ownership Over Time (1965-2019)

Mary Pat Campbell
Visualizing U.S. Stock Ownership Over Time (1965-2019)

Graphic:

Excerpt:

The U.S. stock market is the largest in the world, with total U.S. stock ownership amounting to almost $40 trillion in 2019. But who owns all these equities?

In this Markets in a Minute from New York Life Investments, we show the percentage of U.S. stock owned by various groups, and how the proportions have changed over time.

Author(s): Jenna Ross

Publication Date: 31 March 2021

Publication Site: Visual Capitalism

U.S. Retirees’ Experience Differs From Nonretirees’ Outlook

Mary Pat Campbell

Link: https://news.gallup.com/poll/350048/retirees-experience-differs-nonretirees-outlook.aspx

Graphic:

Excerpt:

The differences in reliance on income sources between those who are already retired and those who are not yet retired are likely attributable, at least in part, to apprehension about the Social Security system, as well as the rise of 401(k)s accompanied by a decline in work-sponsored pension plans.

57% of retired U.S. adults say they rely on Social Security as a major income source, and 38% of nonretirees expect it to be a major source for them.

Likewise, 36% of retirees and 19% of nonretirees say a work-sponsored pension plan is or will be a major income source.

Nonretirees are most likely to say a 401(k) or other retirement savings account will fund their retirement (49%). Meanwhile, 35% of retirees mention 401(k)s as a major funding source of their retirement.

Author(s): Megan Brenan

Publication Date: 18 May 2021

Publication Site: Gallup