From the February 2010 issue of Investment Advisor • Subscribe!

Retirement News

Kathryn Capage, Strategic Planning Director for the Retirement & Tax Advantages Products Division for AIM Investments, recently detailed in a Center for Due Diligence (CFDD) Legislative Update pending retirement-related legislation to watch for this year.

o Fee disclosure Fee disclosure may go to a full Congressional vote in 2010; Department of Labor (DOL) regulations dealing with providers' fee disclosure are due in May 2010.

o Investment advice Investment advice has a chance of passage in 2010; a complete rewrite of the previously issued DOL regulations has a May 2010 deadline.

o Executive pay A number of bills currently pending in Congress could impact executive compensation and corporate governance issues in 2010. H.R. 4173 passed the House in December 2009; as written, it faces an uncertain future in the Senate.

o Defined benefit (DB) plan funding relief Reps. Pomeroy (D-North Dakota) and Tiberi (R-Ohio) introduced a bill in October 2009 which would implement many of the DB plan funding relief proposals being advocated by sponsor and participant groups. There is general support for "doing something" to provide DB funding relief; passage is likely in early 2010.

o Target date funds Regulatory and/or legislative action anticipated in 2010.

o Cross-testing A bill introduced by Rep. Doggett (D-Texas) in November 2009 would eliminate cross-testing of benefits and contributions; facing strong industry opposition, the outlook for this measure is uncertain for 2010.

o Mandatory payroll deduction IRAs Included in President Obama's 2010 budget blueprint; if passed in 2010, companies that don't currently offer a tax-deferred retirement savings plan would funnel employee contributions into IRA accounts through direct payroll deposit.

o Annuities The DOL just announced a project to facilitate use of lifetime income investment vehicles in retirement plans (a formal "request for information" was due in January 2010); any legislative initiative may get folded into broader retirement legislation in 2010 (or 2011).

o Expansion of the saver's credit Also likely to be included in the Obama 2010 budget; a modified version of Rep. Pomeroy's April 2009 bill expanding the credit may pass in 2010.

Lord, Abbett said it was moving to help advisors grow their business by waiving the annual custodial fee for every new Lord Abbett IRA account opened between January 1 and April 15, 2010. Lord Abbett also says it will pay the FedEx shipping charges currently absorbed by advisors for submission of paperwork to open each new account. Under the banner, "The Lord Abbett IRA, The Easy Way to Grow Your Business," the firm says it will also make available to advisors the opportunity to consult with its most senior retirement experts on topics such as Roth conversions and other IRA topics, as well as access a full range of online resources, including videos, articles, and literature through the new Lord Abbett Web site (

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