…contributions and ACP tests after-tax and employer matching contributions. The Top Heavy Test tests the account balances of key employees vs. non-key employees. Minimum Coverage Test – Tests the population of HCEs vs. NHCEs HOW DOES TESTING THE 401(K) CONTRIBUTIONS WORK? The Actual Deferral Percentage…
…research firm Cerulli Associates, with assets rising from $4.6 million as of July 1, 2018 to $10.9 million as of December 31, 2018. But, Cerulli added, the average balance was less than $500, well below the national average 401(k) account balance of $85,000. The IRI…
…changing the rules for retirement plans with 100 or more eligible plan participants: Rather than requiring them to file an annual audit, as is now required, the new rule states that plans should only count participants with account balances. Thus, if a large company’s plan…
…of the year count. That’s important because it can include former employees if they still have an account balance. This reality, plus the annual plan cost of carrying former employees, encourages many plan sponsors to force out former employees with small balances. The Department of…
…As with any future event, it is unclear what will happen with interest rates in 2020. The Fed is currently signaling a hold on rates or at most one rate cut in 2020. They will have to balance a slowing U.S. economy and mild inflation,…
…contributions either way. Keep in mind that while most employers with a student loan proviso make monthly cash payments against an employee’s debt to the loan holder, those payments are taxed. The employer also benefits by providing such a solution in its recruiting of new,…
It is commonly stated that investing and asset allocation involve the choice between 3 asset classes: stocks, bonds and cash. However, it has long been believed that certain types of stocks behave differently from other types of stocks. This concept was first developed by Graham…
…(representing investment grade U.S. bonds) returned 1.2% (1.1% YTD) and the long end of the curve recovered following a difficult first-half of the year with the BarCap Long Treasury Index surging 5.1% (0.2% YTD). Cash continued to yield near 0.0% at the end of 3Q….
…Barclays Capital (“BarCap”) U.S. Aggregate Bond Index (-1.7%) faltered, but the real damage occurred at the long-end of the curve where the BarCap Long Government Index (-8.3%) and the BarCap U.S. Long Credit Index (-7.3%) fell precipitously. Cash continued to produce a yield near 0.0%….
…Longer duration bonds had the most success in Q1as interest rates declined. The Barclays Capital (“BarCap”) Long Government/Credit Index (+3.4%) outpaced both the BarCap U.S. Aggregate Bond Index (+1.6%) and the BarCap Intermediate U.S. High Yield Index (+ 2.4%). Cash continued to produce a yield…
…Markets Longer duration bonds had the most success in Q1. The Barclays Capital (“BarCap”) Long Government/Credit Index (+6.6%) outpaced both the BarCap U.S. Aggregate Bond Index (+1.8%) and the BarCap Intermediate U.S. High Yield Index (+ 2.8%). Cash continued to produce a yield near 0.0%….
…participants. KSOP A KSOP is an ESOP with a 401(k) feature and provides for both employer stock contributions and employee deferrals. Employer contributions can be mad in either stock or cash. A KSOP combines two separate plans, offering simplified administration, streamlined employee communication and greater…