Benefits Blog

What Can Organ Donation Rules Teach Us About 401(k) and 403(b) Plans?

Posted by Nathan Carlson on Monday, September 21, 2015 @ 01:03 PM


The percentage of individuals in Europe that donate their organs upon their death varies greatly from one European country to the next.  For example, only twelve percent of the German citizens choose to donate their organs but if one steps across the border and enters Austria, close to one hundred percent (99.98%) donate their organs.  In Denmark only 4.25% donate their organs, but if one leaves Copenhagen and drives across the Oresund Bridge, down the two-mile long undersea Drogden Tunnel and into Sweden, 86% of the population donate their organs.  Why these strange differences amongst very similar demographics?


Germany, United Kingdom, Netherlands, and Denmark all require an explicit consent before organs can be donated whereas the other seven countries in the study presume that consent has been given unless the citizen specifically opts out of the organ donation program.[1]

In a traditional 401(k) or 403(b) plan at least 30% of the employees never get around to enrolling in the plan, whether or not there is an employer match.  However, when eligible employees are automatically enrolled in the plan (consent is presumed) and then given the option to opt out, about 91% stay enrolled in the retirement plan.[2]

Yes, organ donation rates can teach us about human tendencies and retirement plans.  For further information about adding Auto-Enrollment provisions or to visit with an ERISA professional at Retirement Planning Services, click on the button below.

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[1] Max Bazeman, Psychology of Negotiations, Harvard Business School, 2014

[2] Auto-enroll provisions can only be added to an existing 401(k) or 403(b) plan at certain times during the plan year and only with the necessary plan document amendments and employee notices.  Such provisions must be installed by a competent ERISA professional.


ERISA Dates You Really Don't Want to Miss!

Posted by Nathan Carlson on Wednesday, January 08, 2014 @ 02:02 PM

Ian Thorpe, the former Australian Olympic swimmer doesn’t miss much. He won three gold medals and two silver medals at the 2000 Summer Olympics and eleven World Championship gold medals. But in 2001 he missed an important date. He was out jogging in New York City and intended to go to the observation deck of the World Trade Center when done. However, he realized that he had forgotten his camera in his hotel room. He hailed a cab, returned to his room, and turned on his television to discover he had narrowly missed death. The date was 9/11/2001.

When it comes to ERISA, there are certain dates you really don’t want to miss. Download the following table for free to help prepare. Note that this chart assumes that you are a client of RPS and the retirement plan is on a calendar year. 

Click Here To Download 2014 ERISA Chart

*RPS is only responsible for these items if properly engaged via an executed Service Agreement.

Tags: ERISA, 2014 ERISA Dates

2014 IRS Cost of Living Adjustments

Posted by Nathan Carlson on Friday, November 01, 2013 @ 01:30 PM

IRS Announces New 2014 Limits

October 31, 2013


Today, the IRS announced the 2014 cost of living adjustments for dollar limitations on qualified retirement plan benefits and contributions.

IRS Cost of Living Adjustments for 2014


Tags: Pension, 401(k). SIMPLE IRA, ERISA, Retirement Planning

DOL Audits and Criminal Investigations are Increasing

Posted by Nathan Carlson on Wednesday, September 04, 2013 @ 03:20 PM

describe the imageWhen ERISA was passed in 1974, Congress realized that the provisions of ERISA would have to
be enforced.  So, Congress also created the Employee Benefits Security Administration (EBSA), which is responsible for ensuring the compliance and integrity of the private employee benefit system in the United States.  EBSA is a division of the Department of Labor.

EBSA’s job is immense and the numbers are staggering:

  • EBSA oversees 707,000 retirement plans and 2.3 million health plans

  • These plans cover 141 million workers and over $7 trillion in assets

EBSA was very busy in 2012.  Through over 3,500 EBSA audits and investigations of employee benefit plans, it recovered $189 million in plan assets.  EBSA was also involved in 318 criminal investigations that led to the indictment of 117 individuals--including plan officials, corporate officers, and service providers – for offenses related to employee benefit plans.


Recently, EBSA brought charges against a former 401(k) Trustee, Matthew Hutcheson for 17 counts of felony wire fraud involving three different ERISA retirement accounts that he oversaw.  Matthew was convicted on all 17 counts, ordered to pay $5.3 million in restitution, and sentenced to 17½ years in jail.


How does the Department of Labor and EBSA identify retirement plans for possible audit?  The DOL routinely reviews Form 5500s that are filed on an annual basis by all retirement plans.  For example, if the 5500 is reporting the existence of late contributions, no fidelity bond, or a high concentration in illiquid assets, the plan has a high probability of audit.


However, the greatest source of leads for DOL/EBSA audits comes from none other than the plan’s disgruntled participants.  In 2012, the DOL received over 230,000 phone calls from these participants—calls that resulted in 815 plan audits.


If you are one of the “lucky” ones that have been selected for an IRS or DOL audit, you may want to download a copy of my most recent White Paper, “How to Prepare for an IRS or DOL Qualified Plan Audit”.  This resource will help you to understand the different emphases of an IRS vs. a DOL audit; gives you a checklist of the various documents the auditor may request; and, should you seek out professional assistance, the types of professionals and the corresponding ERISA credentials to look for.


Download the Full PDF Report

Tags: Pension, ERISA, 401(k), DOL, EBSA, Audit