Break from the Grind February 26, 2019

Tooth Fairy Payout Tracks With S&P 500

Delta Dental says the Original Tooth Fairy Poll has tracked with the movement of Standard & Poor's 500 Index (S&P 500) for 14 of the past 17 years.
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The Tooth Fairy’s purse strings appear to be tighter than a year ago with the average monetary payout down by 43 cents, according to the Original Tooth Fairy Poll sponsored by Delta Dental.

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The Tooth Fairy’s average cash gift declined to $3.70 for a lost tooth, down from $4.13 one year ago. Delta Dental says the Original Tooth Fairy Poll has typically served as a good indicator of the economy’s overall direction, tracking with the movement of Standard & Poor’s 500 Index (S&P 500) for 14 of the past 17 years.

However, not all parents polled say the Tooth Fairy is following the national average. In homes that the Tooth Fairy visits, 37% give their child at least $5.00 or more. Also, a first lost tooth stands out as a more celebrated occasion, with an average of $4.96, representing $1.26 above the $3.70 average for subsequent teeth lost.

At $4.19, the West continues to lead U.S. regions in highest average monetary gifts for a lost tooth, but dropped 66 cents compared to a year ago ($4.85). This year, the South, at $3.91, replaces the Northeast for second-highest regional average, but slid by 21 cents when looking back a year ($4.12).

The average Tooth Fairy payout in the Northeast is $3.75, down 60 cents from the previous poll ($4.35). At $2.97, the Midwest represents an average of 73 cents less than the national average, and is 47 cents lower than one year ago ($3.44).

Nearly half (48%) of parents report that their children choose to save their Tooth Fairy Earnings.

The Original Tooth Fairy Poll was conducted between December 31, 2018, and January 13, 2019, among a nationally representative sample of 1,058 parents of children ages 6 to 12.
Ask the Experts February 26, 2019

(b)lines Ask the Experts – Can 403(b) Assets Be Transferred Into a New 401(k) Plan?

Experts from Groom Law Group and Cammack Retirement Group answer questions concerning 403(b) plans and regulations.
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“Are there any circumstances under which a plan sponsor of a 501(c)(3) mon-profit organization can convert a 403(b) plan to a 401(k) and transfer assets from the 403(b) plan to a 401(k)?”

 

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Stacey Bradford, Kimberly Boberg, David Levine and David Powell, with Groom Law Group, and Michael A. Webb, vice president, Retirement Plan Services, Cammack Retirement Group, answer:

 

Unfortunately, not at this time. A 403(b) plan of a 501(c)(3) tax-exempt organization cannot generally be merged with a 401(k) plan; the only exception involves churches, which, subject to certain restrictions, were permitted to merge 401(k) and 403(b) plans that they sponsor via recent legislation.

 

The final 403(b) regulations, in theory, DO permit a 403(b) plan to be terminated by a 501(c)(3) tax-exempt organization. However such a termination would not allow the employer to transfer assets to a 401(k) plan, though participants could make individual elections to roll their 403(b) plan account balances into a 401(k) plan of the 501(c)(3) tax-exempt plan sponsor. However, 403(b) plan terminations are a relatively rare event, since there are many legal and practical barriers to a successful 403(b) plan termination, as indicated in a past Ask the Experts’ article.

 

It is possible that future legislation will make it possible for 401(k)/403(b) plan mergers, but at the present time it is not possible for a 501(c)(3) tax-exempt organization to replace its 403(b) plan with a 401(k) plan and unilaterally transfer assets from the old plan to the new.

 

 

NOTE: This feature is to provide general information only, does not constitute legal advice, and cannot be used or substituted for legal or tax advice.

 

Do YOU have a question for the Experts? If so, we would love to hear from you! Simply forward your question to Rebecca.Moore@strategic-i.com with Subject: Ask the Experts, and the Experts will do their best to answer your question in a future Ask the Experts column.

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