February 14 2018

Like It or Not, Here Are the ABCs of ADP Testing

True or false:  how much a Highly Compensated Employee is allowed to contribute to a 401(k) plan may depend on how much Non-Highly Compensated Employees and other HCEs choose to contribute.  At first glance, the answer to that question would seem to ...

January 24 2018

Compensation: What's in a Name?

With the new year having just begun, our retirement plan clients are busily working on compiling the information we need to do their year-end calculations.  One of the most critical pieces of data we need is compensation paid to each employee for the...

December 20 2017

Investment Considerations for Cash Balance Plans

Cash balance plans have gained in popularity over the last number of years because of the tax savings opportunities available to high-earning business owners and executives. Cash balance plans offer characteristics of both defined contribution plans,...

December 13 2017

The Myth of the Rule of Parity, or, Why Rehires Must Immediately Re-Enter the 401(k) Plan

Suppose someone works at a company, participates in the 401(k) plan, leaves the company for a number of years, and then is rehired.  Does the employee re-enter the 401(k) right away, or does he need to wait a period of time like a brand new employee ...

November 22 2017

Charging Fees to Terminated Plan Participants Okay in Some Cases

When an employee leaves a small company, the expectation is that he will withdraw his 401(k) money at the same time.  While former employees of larger companies often leave their 401(k) money in the plan until retirement, small companies have less to...

November 08 2017

Top-Paid Group Election for HCEs May Help Plan Compliance Testing

Not everybody is familiar with precise definitions of pension terms like Highly Compensated Employee, but most of us would agree that someone with an annual salary of $500,000 sounds like an HCE.  In most cases, we’d be right.  But there is one insta...

October 27 2017

IRS, PBGC, SSA Release 2018 Cost-of-Living Increases

 

September 27 2017

What You Need to Know Before Adopting a 401(k) Plan

The beauty of a 401(k) plan is the flexibility it offers. As a business owner, your main priority may be to offer a 401(k) plan to attract top talent. Or you may want to have a 401(k) plan to reduce taxes by offering a match or a profit-sharing compo...

July 26 2017

Baby Boomer Close to Retirement? Here’s How to Prepare.

 Are you a Baby Boomer close to retirement without the savings you need? If you’re still not ready to retire, you’re not alone. Every day, 10,000 Baby Boomers retire. Yet, 78% of 50-year-olds and 74% of 60-year-olds are behind in saving for retiremen...

July 19 2017

5 Reasons Why You Need to Revisit Your 401(k) Plan Design

Are you guilty of having a 401(k) plan but can’t remember plan design or investment menu? If you answered yes, you are not alone. Many plan sponsors let their plan run on autopilot once it’s up and running, but it may be time to rethink your position...