Retirement Plans Edition
January 9, 2001
Today's sponsor is The Plan Sales System (click on banner for more information)
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Fidelity Survey: 401(k) Participants Vow to Stay the Course
Excerpt: "Nearly half (41 percent) of 401(k) investors told Fidelity that they plan to increase the amount they will contribute to their 401(k) in 2001. Nearly one-third (31 percent) said they will invest their portfolios more aggressively in 2001." (401kWire)
IRA and 401(k) Technical Changes Included In Budget Act Signed By President
Excerpt: "Technical corrections affecting lump-sum distributions under 401(k) plans, withholding rules applicable to Roth IRA distributions, and contribution limits for spousal IRAs, are included in the 'Consolidated Appropriations Act, 2001,' signed by President Clinton on December 21, 2000 (P.L. 106-554)." (CCH)
In Weird Math of Choices, 6 Choices Can Beat 600
Excerpt: "... in an article published last month in The Journal of Personality and Social Psychology, two social psychologists [argue] that at some point, multiplying the number of alternatives people are given becomes counterproductive." (New York Times; free registration required)
Persumma Financial Introduces Flat-Fee Pricing Structure for Its Online 401k
Excerpt: "Persumma Financial will charge a ... monthly subscription fee of $12.99 per employee for its innovative 401(k) plan, enabling employers to provide employees with a better opportunity to retire successfully. Under the new pricing structure, an employee with today's average 401(k) account balance of $47,000 would pay 26 percent less annually for their 401(k) by using one of the low-cost model portfolios designed for Persumma Financial by Morningstar Associates, LLC." (Business Wire, via Yahoo! Finance)
Impact Of Ageing Populations On Public Pension Systems (PDF)
62 pages. Excerpt: "The present progress report has been prepared by the Working Group on the implications of ageing populations (AWG) set up by the [Economic Policy Committee] in December 1999 to analyse the impact on public finances that should characterize all European countries in the first half of the current century." (Economic Policy Committee of the European Commission)
The Preservation of Defined Benefit Plans, 3d Edition (PDF)
55 pages. Excerpt: "Despite claims to the contrary, defined benefit plans work well for states, localities, and their employees.... Efforts by proponents to push defined contribution plans have met with virtually no success among teacher retirement systems. Where changes are being made, they are based on retaining the defined benefit plan and adding innovative features that help to better serve short-service employees." (Cynthia L. Moore, Esq. for the National Council on Teacher Retirement)
Comparing Key Laws Applicable to Private Pension Plans and to State and Local Government Plans
Nice overview, in table format! (Cynthia L. Moore, for the National Council on Teacher Retirement)
(Following also appears in Welfare Plans Edition)
New ruling and determination letter procedures for 2001 issued
The IRS has now issued Internal Revenue Bulletin 2001-1, which contains its annual revenue procedures with updates on procedures for ruling, determination, technical advice, etc. requests. (Internal Revenue Service)
New Issue Online of the Pension & Benefits Update Email Newsletter by Tax Analysts: January 8, 2001
Company President Subject to Excise Tax on Prohibited Transactions; IRS Issues Proposed Regs on Transferring Pension Assets to Retiree Health Accounts; Disclaimers of IRAs, Annuities Sufficient for Charitable Deduction; Stock Sold to ESOP Not 'Readily Tradable'; Reorganization Accomplished After ESOP Merger Okayed; Divorce-Driven Change in IRA Periodic Payment Schedule Approved; IRS Extends Nonapplication of Nondiscrimination Rules to Government Plans and Church Plans; more. (Tax Analysts, Inc.--see www.taxbase.org)
Bush Sticks With Nomination of Linda Chavez for Secretary of Labor
Excerpt: "President-elect George W. Bush said yesterday that he stood by Linda Chavez, his embattled nominee to be labor secretary, even as his aides were reviewing revelations that she provided housing and money to an illegal Guatemalan immigrant for two years in the early 1990s." (Baltimore Sun)
Stock Options for CEOs: Funny Money, or Real Incentive?
Excerpt: "... when companies offer stock options to executives in place of salary, they often have to give them options valued at 250% or so of the cash. While stock options may feel like funny money to their recipients, they represent a genuine cost to their issuers." (Business Week, free registration required)
House Benefits Committees and Senate Finance Committee Get New Leaders
Excerpt: "The two House of Representative Committees with jurisdiction over employee benefits issues have new leaders. Republicans voted [January 4, 2001] to install Rep. Bill Thomas of California as head of the tax-writing Ways and Means Committee and Rep. John Boehner of Ohio as leader of the Education and Workforce Committee." (ERISA Industry Committee)
Cisco Mulls Changes to its Option Strategy
Excerpt: "It's a dilemma shared by many companies these days, especially victims of the tech meltdown. How do you motivate employees who have seen their companies' stock price fall well below the strike price on their options?" (CFO magazine)
| Managing Director-Executive Benefits-Dallas | for Clark Bardes/
Compensation Resource Group in TX |
| Actuary/Programmer | for Bolton Offutt Donovan, Inc. in MD |
| Pension Software Support | for Leading Pension Software Company in FL |
| Plan Administrator | for Pen-Cal in CA |
| Health and Welfare Professional | for Prestigious Employee Benefits
Consulting Firm in IL |
| Project Leader | for ADP in NJ |
| Assistant Administrative Consultant | for Buck Consultants in NJ |
| Communications Associate | for Fidelity Investments in MA |
| Plan Document/Compliance Specialist | for Summit Financial
Corporation in MA |
| Client Relationship Manager | for Fidelity Investments in KY, OH |
| Education Consultant - 401K Plans | for Fidelity Investments in IL, KY, MA, NJ, NY, OH, PA, TX |
| Employee Benefits Consultant | for Fidelity Investments in KY, OH |
| Sr. Manager - 401K Client Relationships | for Fidelity
Investments in KY, OH |
| Project Manager - 401K Implementation | for Fidelity
Investments in KY, OH |
| Benefits Analyst | for Watson Wyatt & Company, a global human capital
consulting firm in CA |
| Communications Consultant | for New York Life Benefit Services in MA |
| Communications Meeting Specialist | for New York Life Benefit Services
LLC in MA |
| Introduction to ESOPs Workshop | in NE on March 19, 2001 presented by National Center for Employee Ownership |
| Introduction to ESOPs Workshop | in IN on March 22, 2001 presented by National Center for Employee Ownership |
| Introduction to ESOPs Workshop | in MO on April 3, 2001 presented by National Center for Employee Ownership |
| Introduction to ESOPs Workshop | in MO on April 4, 2001 presented by National Center for Employee Ownership |
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