HANYS Benefit Services’ 2016 Employee Benefits Survey, Understanding the Strategic Value of Health Benefits , highlights the need to take a multi-faceted approach when designing a cost-efficient and competitive benefits package. A benefits package must be structured in a way that is competitive and controls costs, without shortchanging employee health and wellbeing. To achieve this delicate balance, employers are increasingly seeking guidance on compliance and plan design. “This survey helped call to attention the increasingly complex circumstances under which employee benefit plans are constructed,” said James J. Kelley, President, HANYS Benefit Services. “Employers still need to design plans that are cost effective without a negative impact on recruitment or retention of key employees. The message is clear that the best way to accomplish this goal is to use creative strategies and seek professional guidance on regulations.” Key takeaways from the 2016 HBS survey : Employee benefit r

Register for our live webinar: Retirement Plan Law Suits on the Rise A number of prestigious colleges and universities, including several Ivy League schools, have recently appeared in the headlines as defendants in class action lawsuits relative to their retirement plans. Starting in 2006, the law firm of Schlichter, Bogard and Denton filed a bevy of lawsuits against corporate giants relative to the 401(k) plans sponsored by each corporation. A common thread through all of the suits was excessive fees, but the overarching theme was the alleged failure on the part of the plan fiduciaries to fulfill their fiduciary responsibilities and obligations. Settlements have been reached in several of the suits, resulting in settlement amounts in the tens of millions of dollars. Lawyers on behalf of retirement plan participants are now setting their sights on non-profit institutions, including one hospital in New York. This is a wake-up call to all non-profit organizations to make sure their retir

A retirement plan’s overarching goals are to help participants accumulate wealth during their years of employment and to provide them with income during their retirement. The challenge for fiduciaries is to successfully navigate the options available and build an optimal investment menu that is designed to guide participant choices and improve their retirement readiness. Since plan fiduciaries may be exposed to personal liability, it is prudent to have a process in place for the selection and monitoring of investment options. HANYS Benefit Services has outlined a four-step process for constructing an optimal investment menu that: fosters ERISA compliance; provides desirable investment choices for plan participants; and impacts retirement outcomes. Read  4 Steps to Building an Optimal Retirement Plan Lineup for Participants  to learn more. If you have any questions, or would like to begin talking to a retirement plan advisor, please get in touch by calling (800) 388-1963 or e-mail us at

Target date funds (TDFs) are characterized as either proprietary or custom. The U.S. Department of Labor encourages plan fiduciaries to consider a custom solution. Custom TDFs are typically offered in separate account or collective trust vehicles. These vehicles are not registered as investment companies under the Investment Company Act of 1940 and therefore are precluded from use in 403(b) plans. Proprietary TDFs are defined as pre‐packaged investments that usually are comprised of underlying mutual funds of a single investment firm. Therefore, it can be challenging to ensure “best in class” managers are offered across the underlying funds within the proprietary TDF. Morningstar, Inc., a leading investment analysis firm, considers it a best practice for target date managers to continually assess the stand-alone merit of each underlying fund used within their target-date series. Custom TDFs are created by the retirement plan sponsor, who ultimately becomes responsible for choosing the

The U.S. Department of Labor's Employee Benefits Security Administration issued tips intended to help plan sponsors select and monitor target date funds (TDFs) in their investment lineups. These target date fund basic definitions will help plan fiduciaries navigate the Department of Labor Tips for ERISA Plan Fiduciaries. Asset classes  are groups of securities that exhibit similar characteristics. The three main asset classes are equities (stock), fixed-income (bonds), and cash. Additional asset classes that may be employed within a target date fund are: world bond, emerging markets, and/or real assets like commodities and real estate investment trusts (REITs). Risk  is the probability or likelihood that an investment’s actual return will be different from the expected return. This includes the possibility of losing some or all of the original investment. Volatility  refers to the relative rate at which the price of a security moves up or down. Certain investments are more volatile

In 2013, the U.S. Department of Labor’s Employee Benefits Security Administration issued tips intended to help plan sponsors select and monitor target date funds (TDFs) in their investment lineups. It is incumbent on plan fiduciaries to establish a process or fiduciary best practice for comparing and selecting target date strategies, especially when they serve as the plan’s Qualified Default Investment Alternative (QDIA). Fiduciaries should implement a process to perform periodic reviews to have a clear understanding of the investments and how they will change over time, and to compare the funds’ fees. Target date funds automatically adjust their asset mixes to become more conservative as investors approach retirement age. This shift in the asset allocation over time is called the TDF’s glide path. Some TDFs’ glide paths are managed “to” retirement, while others are managed “through” retirement. Risk Level at Retirement Comparison of “ to ” versus “ through ” funds © 2015 Morningstar

The U.S. Department of Labor's Employee Benefits Security Administration issued tips intended to help plan sponsors select and monitor target date funds (TDFs) in their investment lineups. These target date fund basic definitions will help plan fiduciaries navigate the Department of Labor Tips for ERISA Plan Fiduciaries. Target date funds  automatically adjust their asset mix to become more conservative as an employee gets closer to his or her target retirement date. QDIA  is a default investment option chosen by a plan fiduciary for participants who fail to make their own investment election. The Pension Protection Act of 2006 approved target date funds as a QDIA. Glide path  refers to the target date fund’s shift in asset allocation over time. Fiduciaries should understand the target date fund’s glide path and be comfortable that it is appropriate for their participant demographics. Fiduciaries should know whether the glide path uses a  “to retirement”  or  “through retirement”