Retirement Plans Edition
January 16, 2001
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Many Employees Uninformed About Pension Plans
Excerpt: "'Either people don't understand important features of the plan, like vesting, or they expect that when they reach retirement age all the information will be in place to get them their pension,' ... said [the regional coordinator for the New England Pension Assistance Project]." (Reuters via Excite! News)
401(k) Accounts Suffer in Slowing Market
Excerpt: "Because of turbulence in the stock market as of late, many 401(k) participants have been experiencing losses. But last year, the average investment returned on the 401(k) balances declined by 4 percent. And fully a third of those investing in 401(k) plans have done so only over the previous five years, when returns averaged a gain of 20 percent." (ABCNews.com)
Funds in 401(k) Plans Fell 4% on Average in 2000, Study Says
Excerpt: "Socking money away in the stock market for retirement wasn't much use in 2000: After the worst year for U.S. equities in two decades, the average 401(k) account investments declined 4 percent, according to a new study." (Bloomberg)
401(k) Investors Brace for Bad News
Excerpt: "Stocks have been sliding for months now, but many investors will realize the extent of their losses only after reading annual retirement account statements that are in the mail this month." (Associated Press)
Private Pensions in Britain Under Threat from European Commission Recommendations?
Excerpt: "European Commission proposals to harmonize pensions could result in British companies withdrawing pay-linked pensions for employees according to a report in The Times today. The position of the 650 billion pound pensions industry in the UK could be seriously undermined if the draft proposals from the European Commission are applied in the UK." (HRZone)
Another Question is Answered in the Correcting Plan Defects Q&A Column
A profit sharing plan is top-heavy for the plan year ending December 31, 1999. The 1999 top-heavy contribution has not been made. Does this mean the top-heavy failure in this case occurred in the 2000 plan year and earnings adjustments on the corrective contributions should be calculated from December 31, 2000? (BenefitsLink.com)
Online 401(k) Plans Altering Market
Excerpt: "A new Web-based retirement plan, dubbed e-401(k), stands to bring an important benefit to workers at more small companies - and to shake up the $2.5 trillion nest egg business." (Boston Globe)
Early Retirements Could Put California School District on the Spot
Excerpt: "More than 200 San Juan Unified School District teachers have signed up for an early-retirement offer, so the school system may have to hire twice as many new staff members as usual this year. The plan would provide financial incentives for veteran teachers who are nearing retirement age but aren't eligible for regular retirement." (Sacramento Bee)
Milwaukee Employees' Pension Deal Will Open Retirement Gates
Excerpt: "When the Common Council finalizes a new global pension settlement for city employees later this month, about 50 police officers will retire immediately under the new eligibility standards, and as many as 200 more could follow them by the year's end" (Milwaukee Journal Sentinel)
(Following also appears in Welfare Plans Edition)
Commentary on IRS Split-Dollar Ruling
Excerpt: "In general, the Notice provides a kind of 'check-the-box' approach to the taxation of split-dollar arrangements. The parties have the option of characterizing it as either a loan transaction or as a transaction in which the employer acquires an interest in the policy and provides current life insurance protection and, in equity arrangements, an interest in the cash surrender value of the policy, to the employee." (Michael A. Swirnoff, Esq., for the Magner Financial Network)
| Asset Reconciliation Coordinator | for Zurich Scudder Investments in NH |
| Employee Benefit Trust Officer | for BankFirst Trust Company in TN |
| DIRECTOR OF PENSION OPERATIONS | for MBM Advisors Inc. in TX |
| Benefits Analyst Senior | for Jet Propulsion Laboratory in CA |
| Analyst - Benefits Consulting | for Towers Perrin, a leading global management consulting firm in CA |
| 401k Compliance Testing Analyst | for Automatic Data Processing- Retirement Services in NJ |
| Director, Quality Assurance | for Automatic Data Processing- Retirement Services in NJ |
| 401(k) Pension Administrator/Entrepreneur | for an independent small plan administrator in ALL STATES |
| Consultant, Employee Benefit | for The Standard Insurance Company in |
| 401(k) Administrator | for Benefit Management Inc. in MA, RI |
| 401(k) Plan Administrator | for Polycomp Administrative Services, Inc. in CA |
| Compensation & Benefits Analyst | for PTI Technologies, Inc. in CA |
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