FullSizeRender copyHello friends,

Thank you for bearing with me over the last few days.  After our summit last week with the Treasurer, I had to spend a few well deserved days with the family, and on Monday morning, began to deal with House Bill 399 dealing with Component 5 issues.  Now that the dust has settled, I want to let everyone who was not able to attend our meeting know how it went.

First of all another THANK YOU to Treasurer Simpler and his team.  They were able to address our group concerns and offer some valuable insight into the process and the reasons for the retirement plan changes.

I also want to say THANK YOU to our DSEA hosts!  Their hospitality and attention to detail helped make the Summit successful from a logistic perspective, and they also helped out with refreshments.

A HUGE SHOUT OUT to Tammy Wagner of DSEA and Martha Sturtevant from the Treasurers office.  Both of these wonderful ladies helped me set up the Summit, and were extremely patient and kind!

The Summit began with a meet and greet.  We had well over 30 people in attendance.  As the group began to settle in Treasurer Simpler was introduced and was given an opportunity to share some of his background and the process under which the Deferred Compensation Committee worked.  It is important to point out the Treasurer Simpler did outline who the specific members of the DCC were, and did explain that there was indeed a missing member of the committee , which traditionally had been a teacher.  He spent a great deal of time going over the  “Fiduciary” nature of his position on the DCC.

There have always been sayings like “Pesto is the quiche of the 90’s” and “Orange is the new black”,  so here is a new one for our lexicon….. “Fiduciary is the because I said so “of  today!


adjective Law
adjective: fiduciary
  1. 1. involving trust, especially with regard to the relationship between a trustee and a beneficiary. “the company has a fiduciary duty to shareholders”
    • archaic
      held or given in trust.
      “fiduciary estates”
    • Finance
      (of a paper currency) depending for its value on securities (as opposed to gold) or the reputation of the issuer.
noun: fiduciary; plural noun: fiduciaries
  1. 1. a trustee.


late 16th century (in the sense ‘something inspiring trust; credentials’): from Latin fiduciarius, from fiducia ‘trust,’ from fidere ‘to trust.’

In the news…

The ‘fiduciary rule’ would force financial professionals to charge their customers more.

Generally, the “Fiduciary Excuse” as I call it, (not to be negative, it just seems to cover so much i may use it to get out of a situation if I can from now on) was thrown around many times.  All of our suggestions and solutions received the “Fiduciary Excuse” as the night went on.  We talked about “Grandfathering” and “delayed start up” and other scenarios that would offer relief to our members, but ultimately, the “Fiduciary Excuse” always seemed to be the answer.  There was also a great deal of legal back and forth between the Delaware Attorney Generals office and legislators.  This seemed to also cause a slow down in the way information was getting out to our members.
A representative from VOYA was present to address concerns and present VOYA to our members as the new Retirement Benefit vendor.  I will say that their presentation and their plan for development was generally well received.  VOYA seems to have some new and innovative products and platforms that may work out well for many of our members.  It is unfortunate that their entry into our retirement benefit process was hampered by the process.  I wish them luck in their future work with our Delaware State Employees.
Ultimately the Summit was successful in getting the concerned parties to the table.  At this point many of our DSEA Local Leaders have been informed about the changes, and have been able to share member questions and concerns.  That was the goal of our Summit, and to that end, I believe we had some success.  So where do we go from here?
I spent the day in Dover on Tuesday and while dealing with Component 5 legislation, I was also able to sneak around both chambers of our Delaware State House.  I was able to chat with a few legislators about our retirement issues.  Each and every politician that i spoke with felt bad about what was happening with our retirement options.  Each of them offered their support, BUT NONE OF THEM SEEMED WILLING TO GO THAT EXTRA STEP.
At this point we may need legislation to slow down the process.  When i directly asked each of these Representatives, and Senators about their willingness to craft a bill in our favor, i received less that enthusiastic responses. I have also reached out to Governor Jack Markell for aid both publicly and privately, but have received no response, so our chances of getting some kind of “Executive Reprieve” is not likely.
As the summer goes on I suggest we continue to monitor the situation, and continue to communicate with each other and our legislators…

Contact The Deferred Compensation Committee

Deferred Compensation Team


Join the group…

FACEBOOK GROUP Delaware School Employees United for Retirement Choice

Or like our page…

FACEBOOK PAGE Delaware School Employees United for Retirement Plan Choice

Lets continue to work together over the next few months so that more and more of our members and friends get the information.

Thank you





ASPPA American Society of Pension Professionals and Actuaries report



The Impact of Reduced Choice on Participation by School District Employees in 403(b) Plans

PROTECTING PARTICIPATION Debra A. Davis, Esq., LL.M., Dr. Geralyn Miller, Ph.D. & Judy A. Miller, FSA, MSPA



403(b) plans provide an important method to save for retirement for many school district employees. These plans allow workers to make independent decisions as to how much they want withheld from each paycheck and contributed to the plan. Employees are typically permitted to adjust their contribution amounts during the year as necessary. School districts can also make contributions to 403(b) plans on behalf of their workers.

403(b) plans differ from 401(k) plans in that school districts are frequently less involved than private employers are in their 401(k) plans. Individual public schools do not have human resource departments and school districts frequently do not have the resources to develop a “culture of savings” in the same way as the private sector. School-sponsored 403(b) plans typically are not subject to the non-discrimination rules that encourage many private employers to foster savings by lower paid workers. Additionally, participants in 403(b) plans often have their own individual contracts with the investment provider.

Often, a school may only collect contributions and make its auditorium or gymnasium available for advisors to meet with interested employees. Thus, participants bear more responsibility, and often need more help to learn about how the plan works, how much to save for retirement, and how to invest their money in the plan.

This paper examines the impact of participant choice in 403(b) plans. It looks at the extent to which school district employees want choices

in their 403(b) plans and whether providing those choices is beneficial to them.

It finds that many participants want the ability to receive assistance with their retirement plans. For example, a study by the TIAA-CREF Institute showed that 60% of near-retirement higher education employees had consulted with a financial professional about retirement during the previous two years. A study by Merrill Lynch also revealed that 34% of retirees would recommend working with a financial advisor early in life.

Studies showed participants have varied preferences regarding how they want to receive assistance. For example, a survey by Charles Schwab indicated that 51%
of participants preferred one-on-one consultation, while 23% preferred an online tool. A study by ING reflected that 59% of government workers wanted seminars or meetings, while 66% preferred printed materials. Multiple methods for receiving assistance, such as those described in the surveys, are currently available to 403(b) participants through the marketplace.

The paper finds that participant choice is valuable both in terms of helping workers prepare for retirement and maintaining participation levels in 403(b) plans. Studies indicate that workers save more for retirement and have greater diversification when they have the ability to consult with a financial professional. Additionally, researchers at the RAND Corporation found that individuals who voluntarily elect to receive advice have greater positive performance results than both persons who do not receive advice as well as individuals who automatically receive advice.

Data also reflects that participation in 403(b) plans declines when the number of investment providers is reduced. In Southern California, around 50% of workers stopped contributing to their 403(b) plans when their existing investment provider was no longer available. Similarly, the number of participants dropped by over 54% when a school district in Colorado went from 55 investment providers to a single investment provider model for its 403(b) plan. Nearly 40 percent of participants

ceased participating in a 403(b) plan at a school district in Pennsylvania when the plan went from nineteen investment providers to a single investment provider.

Thus, the paper suggests that school districts should avoid reducing the number of investment providers in order to protect the levels of participation in 403(b) plans. School districts that are interested in reducing costs may want to consider options that include using an independent third party administrator (TPA) to administer the plan and providing transparent disclosure of investment fees and other expenses to workers.

For many school district employees, 403(b) plans provide an important means to save for retirement. Participants in these plans can make independent decisions with regard to how much they want withheld from each paycheck and contributed to the plan. Unlike 401(k) plans, there is typically less employer involvement in school-sponsored 403(b) plans. Thus, the onus is on the worker to learn about how the plan works, how much to save for retirement, and how to invest their money in the plan. As a result, school district employees often need to receive more retirement advice for 403(b) plans than participants in 401(k) plans.

This paper evaluates the impact of participant choice in 403(b) plans. It examines the extent to which workers prefer choice in their 403(b) plans and the impact of having choices.  The paper finds that school district employees benefit from the option to receive advice, both in terms of their preparation for retirement and participation levels. It further finds that data reflects a decrease in the participation rates for 403(b) plans when the number of investment providers is reduced. As a result, this paper suggests that school districts consider alternatives to reducing the number of investment providers in order to reduce costs. These include using an independent third party administrator (TPA) to administer the plan and providing transparent disclosure of investment fees and other expenses to workers.

Please view the entire document here…