Secure 2.0 (1) Death of 401(k) Testing As We Knew It

As part of the 1,653 pages of the Consolidated Appropriations Act, 2023 we got, from pages 817 through 946, the SECURE
2.0 Act of 2022
. This series will review aspects of this new pension law impacting me my clients starting with the death blow to ADP testing as practiced when these 401(k) plans originated.

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Hanging In There!

This book is why you roam the stacks after you locate all the books you had on your list to pick up at the Waterbury library. A dissertation on “how to resist retirement from life and avoid being put out to pasture” from forty years ago by an author who made it through 25 more years after he wrote it.

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Don Rickles: Merchant of Venom

More reportage but unlike all those Trump books by reporters this subject is of interest to me as I relived some of my life in TV entertainment. Not much quotable but a nice ride.

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First headline on yahoo is about big changes coming to the private retirement system while Bloomberg does not see it as going far enough. Pertinent (to me) excerpts form the Senate Finance Committee Summary of SECURE 2.0:

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Truth on NJ Financial State 2022

Truth in Accounting (TIA) released its thirteenth annual Financial State of the States with New Jersey (after a year at number 49) regaining it’s worst-in-the-nation status.

(50) NEW JERSEY moved from 49th to last place in fiscal year 2021 and remained in the bottom five Sinkhole States for the thirteenth year in a row. New Jersey was the only state to experience a decrease in their financial condition. The money needed to pay bills increased by more than $12.5 billion. Like all states, New Jersey’s pension plan assets experienced significant, short-term increases in values, yet the state’s portion of their Net Pension Liability increased because they assumed new pension responsibility from their local governments. This all translates to an individual Taxpayer Burden™ of $58,700 giving New Jersey the distinct dishonor of last place in the Financial State of the States for 2022. (page 12)

Supplanting my new home state:

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Central States Bailout Approved

Not that there was much doubt about it and it is not on the PBGC website yet but today the announcement was made.

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Judicial Hellhole for Actuaries

The New Jersey Affidavit of Merit statute, N.J.S.A. 2A:53A-26 et seq., states, in pertinent part:

In any action for damages for personal injuries, wrongful death or property damage resulting from an alleged act of malpractice or negligence by a licensed person in his profession or occupation, the plaintiff shall, within 60 days following the date of filing of the answer to the complaint by the defendant, provide each defendant with an affidavit of an appropriate licensed person that there exists a reasonable probability that the care, skill or knowledge exercised or exhibited in the treatment, practice or work that is the subject of the complaint, fell outside acceptable professional or occupational standards or treatment practices. The court may grant no more than one additional period, not to exceed 60 days, to file the affidavit pursuant to this section, upon a finding of good cause.

This rule came in around 2003 and decreased the number of lawsuits against doctors and other professionals here thus going a long way towards keeping New Jersey off this list.

But as for actuaries, we don’t make this list:

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Broken News (II)

Rest of the book excerpts.

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Broken News (I)

Chris Stirewalt, who had a hand in pulling the trigger on Trump in Arizona in 2020 and got bounced from Fox News for it, has a book that diagnoses the development of the “media rage machine”.

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Billion Dollar PBGC Bailouts

On November 15, 2022, PBGC posted a list of plans that meet the requirements for SFA application Priority Group 6 which includes plans for which PBGC projects a present value of financial assistance payments under section 4261 of ERISA that would exceed $1 billion in the absence of SFA. The application period for Priority Group 6 plans is currently scheduled to open on February 11, 2023.

PBGC lists 14 eligible plans but according to Shcedule MB data from 2016 there were 103 plans with unfunded liabilities of over $1 billion – listed below with 9 of the 14 priority Group 6 plans located with their EIN in bold.

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