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Fiduciary slugfest! 401(K) fees square off vs. proprietary funds — A case for why fees may come out on top, and how you can mitigate your fiduciary risk

As a fiduciary partner, our clients are seeking input on which area warrants greater risk mitigation: ensuring fee reasonableness or the use of proprietary funds in the core lineup? While it could turn into a technical tit-for-tat, to simplify things we took the most straightforward approach and ran a Google News search on "401(k) lawsuits." This may not come as a surprise, but the first 10 search results pointed to excessive plan fees.

A summary of the SECURE Act

As an early holiday present for some, Congress passed (and the President signed into law) two spending bills, one of which contained the provisions for the Setting Every Community Up for Retirement Enhancement Act of 2019 (the “SECURE Act”). The purpose of the SECURE Act, which has been sitting in Congress for months, is to enhance opportunities for people to increase their retirement savings and ease administration of qualified retirement savings plans for employer sponsors. This post will provide an overview of the SECURE Act’s most notable changes to retirement plans and how employers, as well as employees, will be impacted.

New hardship distribution rules and how plan sponsors should respond

Because hardship withdrawals permanently reduce an employee’s account balance, the IRS has placed stringent rules on how and when a participant can take a distribution — even if it’s for a financial need. The IRS has issued final rules that will relax some of the more arduous guidelines. The new guidelines are set to take effect January 1, 2020, and some of them are mandatory for plan sponsors to adopt.