Recent Developments in Benefit Plans
DOL Fiduciary Rule Finalized. The U.S. Department of Labor (DOL) issued its final version of the rule governing those who provide investment advice to retirement plans, plan sponsors, plan fiduciaries, plan participants and beneficiaries, individual retirement accounts (IRAs), and IRA owners. The new rule requires all who provide retirement investment advice to abide by a fiduciary standard and put their clients’ best interests first. The changes will be phased in, with full compliance due to begin January 1, 2018.
Communicating About Benefits. A recent study by the International Foundation of Employee Benefit Plans showed that 65% of organizations surveyed believe that educating employees about their benefits is a high priority. The strategies with the highest success rates are communicating by life stage (81%), year-round communication (79%), and leveraging word-of-mouth (75%). Topics with the highest success rates include information on retirement benefits (83%), financial literacy (77%), and health care benefits (75%).
Deciding When to Retire. Being happy at work can be a significant factor in predicting an individual’s retirement age. According to a report from the Center for Retirement Research at Boston College, nonfinancial rewards keep some workers in the work force and influence others to retire. In particular, nonfinancial factors such as personal growth and meaningful relationships directly affect one’s choice