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The BenefitsLink Newsletter -
Retirement Plans Edition

November 9, 2000

Today's sponsor is 2e Corporation
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Technical Tip: Plan Allowed Elective Deferrals During 12-Month Period After Hardship Distribution
Excerpt: "What are the possible methods of correcting this error under APRSC?" (Reish & Luftman)

Retirees Ride the Stock Rollercoaster
Excerpt: "[401k plan participant Wayne] Moore said he recently tried to cash out his 401(k) because he and his wife wanted to buy a camper. He said he learned that before he can do that, he is required to sell a certain percentage of his [employer's] stock in the 401(k). With little hope for a significant increase anytime soon, the beleaguered stock is not an attractive buy, he said." ([Lancaster, Penn.] Sunday News)

First 401(K) Plan Participants Were a Bit Skeptical in 1981
Excerpt: "Ed Johnson, John Fletcher and Trisha Brambley have three things in common: they were the first-ever 401(k) plan participants, they were a bit skeptical of the idea, and today they're rather wealthy." (401Kafe.com)

What Would Make Your 401(K) Plan Irresistible?
Excerpt: "According to [Hewitt Associates' recent Trends & Experiences in 401(k) Plans 1999 Survey], few design features actually have an impact on participation rates. Whether you agree or disagree with such findings-- and HRfocus generally disagrees-- Hewitt's poll provides a useful guide to those in search of plan simplicity and a 'respectable' participation rate." (HR Focus)

PBGC Announces Maximum Guarantee for the Year 2001
Excerpt: "The Pension Benefit Guaranty Corporation (PBGC) today announced that the maximum benefit it will guarantee for retirees in underfunded single-employer defined benefit plans that terminate in the year 2001 will be $3,392.05 per month, or $40,704.60 per year." (Pension Benefits Guaranty Corporation)

Another Question is Answered in the Stop, Look & Listen: Railroad Retirement Q&A Column
Has anyone heard about H.R. 5387 which was introduced on October 3 would put Rail workers under Social Security? Please alert everyone who may be impacted by its passage. (BenefitsLink.com)

Shifting 401(k) Important Decision in Job Changes
Excerpt: "When you change jobs, knowing what to do with the money vested in your 401(k) plan can save tax and retirement dollars. You can (1) leave your 401(k) money where it is, (2) transfer it to your new employer's plan, (3) roll it into an IRA, or (4) take a lump-sum distribution. The best choice is the one that fits your investment and retirement goals." (InsideVC.com)

California Voters Defeat Proposal for Legislators' Ability to Participate In State Pension Program
(Sacramento Bee)

Despite Defeat, Roth's Retirement Savings Legacy Lives On
(USA Today)

Washington Worries About Employees' Low Savings Rates
Excerpt: "[I]nvestors should be getting ready for some substantial changes to their retirement savings plans next year. Congress is debating measures designed to increase savings, the Clinton administration has been pushing plans of its own and the topic has been hot on the campaign trail. The push may be the strongest in two decades, since lawmakers established the Employee Retirement Income Security Act, IRAs and 401(k) accounts." (Knight Ridder/Tribune)

Whirlpool To Encourage Early Retirements
Excerpt: "Castrale said the current incentive package was being offered to people who were at least 51 years old and whose ages and years of service add up to at least 76. These employees could add up to four years to their age or to their years of service to improve their retirement package or to retire earlier." (Evansville [Ind.] Courier & Press)

New Site: European Federation Of Employee Shareownership
Excerpt: "EFES' objective is to act as the European umbrella organization of employee owners and all persons, companies, trade unions, experts, researchers, institutions, all those people who are looking to promote employee ownership and participation in Europe." (European Federation Of Employee Shareownership)

Opinion: Plans to Fix Social Security Benefits Would Hurt Elderly Women
(San Francisco Chronicle)

Stock Options Are Shifting Overall Tax Burden to Individuals
Excerpt: "The 1990s were the decade of stock options, when corporate mortals such as secretaries and tech geeks became millionaires by exercising those lucrative perks. Their employers got something out of that, too-- a tax deduction that has helped many of wipe out or pay very little corporate income tax, experts said." (Knight Ridder/Tribune)

(Following also appears in Welfare Plans Edition)

Supreme Court Hears Oral Argument Today on Egelhoff ERISA Preemption Case
Excerpt: "No. 99-1529. Egelhoff v. Egelhoff. Does ERISA preempt a state law purporting to revoke a beneficiary designation made pursuant to the terms of an ERISA plan? (One hour.)" (Washington Post)

Court Ponders Employee Benefits Conflict
Excerpt: "Divorce can create sticky situations, especially if the husband dies soon afterward without removing his ex-wife as his life-insurance beneficiary. The Supreme Court wrangled yesterday over what law governs who gets someone's employee benefits after they die." (Washington Post)

Domestic Partner Benefits Becoming More Common Among Minnesota Employers
Excerpt: "What 'domestic partner' means depends on where you work. Of the 85 private companies in Minnesota now offering such benefits, about half restrict eligibility to same-sex partners, with the rest opening the door to anyone-- straight or gay-- who meets the employer's criteria.... Minnesota Public Radio was the first employer in the state to announce domestic-partner benefits, in January 1992. Others that followed suit include Northwest Airlines and the Minneapolis YWCA." (StarTribune.com)

"Pay to Stay" Strategies
Excerpt: "The 'right' strategy for a particular employer depends on its circumstances, which we assess through a series of questions that help our clients identify the key terms of their pay-to-stay arrangements. Set forth below are the initial questions, along with an illustrative ... list of possible responses." (Attorneys Mark Poerio, Kevin Conboy, Paul Connell and Ethan Lipsig)

Lack Of Signature Most Common Mistake On Handwritten Forms 5500

Job Openings Newly Posted or Reposted on EmployeeBenefitsJobs.com

Senior Benefit Administratorfor Buck Consultants
in NJ
Project Leader -Admin Opsfor Buck Consultants
in NJ
Telecommunications Specialistfor Buck Consultants
in NJ
Retirement Plan Sales for Ceridian Retirement Plan Servicesfor Ceridian
in AZ, CO, MN, NM
Benefits Specialistfor Riggs Bank, N.A.
in DC
Benefits Analystfor Circuit City Stores, Inc.
in VA

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