The coronavirus pandemic has placed unprecedented challenges on employers, as we have seen companies being forced to implement layoffs and furloughs and navigate financial constraints from decreased revenues and profits. It has become clear that the COVID-19 health crisis has brought and will continue to bring significant economic disruption, which means that employers need to confront the challenges related to their 401(k) plans. Many organizations have been coming up with ways to prudently manage their budgets and expenses, and one topic that deserves attention is the flexibility surrounding changes to employer-sponsored retirement plans with respect to the employer match, profit-sharing, and discretionary contributions.

It was another tough week for the markets – rehashing the numbers merely magnifies the pain, so let’s leave it at that. A positive to acknowledge: The U.S. economy entered this period of uncertainty from a position of strength. The economy was robust, the unemployment rate, at 3.5%, was at historic lows, the consumer balance sheet was strong, and consumer debt service – after years of refinancing – was at modern-era lows. We shudder at the thought of what the damage to the economy would have been if we had had to battle this pandemic in 2009 while our economy was suffering in the aftermath of the credit crisis. This outbreak is an external factor penetrating the economy; it is not a by-the-book recession that involves the economy bubbling and bursting internally with a grim recovery outlook due to the issues stemming from weak fundamentals. Fundamentals were strong and trending positive before this acute event, meaning, from an economic standpoint, we are in a position to weather this storm, regain strength, and eventually recover.

We want to take a moment to address the extreme selling that has transpired in the markets throughout the last few days and weeks. It’s too early to say if yesterday’s capitulation-style selling signaled a market bottom, and it is too early to predict what the resulting short-term and long-term damage to the domestic and global economies will be. Our view is that most industries and sectors will recover from the coronavirus sell-off, while the industries that have been most directly impacted by the virus – hospitality, transportation, and tourism – will face a prolonged recovery. The timing and degree of recovery is first and foremost dependent on the spread and subsequent containment of the virus.

We are all aware of the 401(k) contribution limits set annually by the IRS, but what if you’ve maxed out your contributions for the year and still want to save money for retirement? You could fund a brokerage account separate from your 401(k), but you would face a costly capital gains tax on those earnings. This is where leveraging an after-tax source in your 401(k) comes into play.

Before dispersing for its winter break, Congress passed significant changes to retirement savings law that will affect many of us now and all of us in the future. This new law, the Setting Every Community Up for Retirement Enhancement (SECURE) Act, is part of the massive government spending bill that was approved by Congress on December 19 and signed into law by President Trump on December 20, 2019. This bill extensively reshapes the realm of employer-sponsored retirement plans for both employers and employees and enacts the biggest changes to the U.S. retirement system since 2006.

Bethesda, MD (October 10, 2019)— AFS 401(k) Retirement Services, a Retirement Plan specialist in Bethesda, MD, today announces that its Managing Principal, Alex Assaley, AIF®, has been named to the Financial Times 401 Top Retirement Advisers list for 2019. The fifth annual list, produced independently by the Financial Times in collaboration with Ignites Research, was recently published in a special section of the newspaper’s U.S. edition, as well as on ft.com. 

Bethesda, MD (November 19, 2018)—AFS 401(k) Retirement Services, a Retirement Plan specialist in Bethesda, MD, today announces that its Managing Principal, Alex Assaley, AIF®, has been named ‘2018 Top Advisor by Participant Outcomes’ (TAPO) recipient, he was chosen by a group of independent panel of industry experts.  

For the past several years, we've produced an annual Trends and Innovations in Employee Benefits report. This report compiles some of the biggest trends, ideas, and initiatives impacting organizations and companies with respect to employee benefits, engagement, and human capitol management. As we prepared for our tenth installment our team worked diligently to continue our mission of delivering fresh, forward-thinking topics with high quality ideas shared from industry leaders, practitioners, and peers.