| The BenefitsLink Newsletter - Retirement Plans Edition |  |
April 18, 2001
Today's sponsor: Reish Luftman McDaniel & Reicher (click)
Have questions about ... qualification failures, when and how to correct, a plan's right to participate in EPCRS? You'll want The Plan Correction Answer Book. It's a comprehensive guide to the IRS remedial programs, written by attorneys Fred Reish and Bruce Ashton, of Reish Luftman McDaniel & Reicher. Click on the link to order!
Changes in Treasury Bills Vex Pension Sponsors
Excerpt: "A falling interest rate environment is generally favorable to business interests, such as by reducing corporate debt, so employers may gain more than they lose, despite the higher pension costs. But lower interest rates not only increase pension contributions and lump sum distributions; they also change the financial accounting impact of sponsoring a pension plan, increasing the pension-related expense or decreasing any pension-related gain." (Watson Wyatt)
Bankruptcy Reform Protects Pensions
Excerpt: "Last month, the House and Senate approved bankruptcy reform legislation, which President Bush plans to sign into law. The bill makes it harder for individuals to declare bankruptcy, but it also protects the pension assets of bankruptcy filers." (Watson Wyatt)
IBM Workers Continue to Fight Pension Changes
Excerpt: "Employees don't expect to win a shareholder vote to undo the pension changes IBM made two years ago. But they do hope to shame concessions out of IBM's management, especially chief executive Louis V. Gerstner Jr., who received a $73.6 million compensation package last year even as employees struggled with the benefits changes." (Washington Post)
Wisconsin Court Ruling Revives Milwaukee Police Pension Lawsuit
Excerpt: "The fund served officers who were hired prior to July 1947, when they were allowed to join the regular city pension system. Under the old system, officers could elect to contribute additional money toward pension benefits for officers' widows. If they did, the city also had to make a contribution. The suit alleges that for a period of years, the city did not make those contributions." (Milwaukee Journal Sentinel)
IRS Eases Required Distribution Rules
Excerpt: "'Easier' doesn't mean 'easy' but the rules for figuring out how much participants have to take out each year under the new proposed regulations are less cumbersome. For participants who do not need to live on their retirement benefits, smaller required distributions will result in lower taxes, a longer-lived tax shelter and potentially larger payouts for the participant's beneficiaries." (W. E. Stanley & Company, Inc.)
DOL Issues Guidance on Demutualization
Excerpt: "Demutualization is when a mutual insurance company, which is owned by policyholders, converts to a stock company, which is owned by shareholders. Ownership then transfers from the policyholders to the new shareholders, and the accumulated surplus (in the form of stock or cash) is distributed to the former policyholders." (Watson Wyatt)
Hewitt Index Watches 401(k) Money Move
Excerpt: "Hewitt, one of the major employee benefits consulting firms, launched their Hewitt 401(k) Index in mid-1997 and has been tracking our collective decisions ever since. Month by month they track the contributions, exchanges, and asset allocation in large employer plans with billions in assets. They track the money flow in and out of a dozen asset classes that range from money market funds to emerging markets and company stock." (Scott Burns)
Fee-Based Compensation for Financial Advice: Four Options
Excerpt: "If the firm chooses to implement a fee-based compensation structure, it has several options. Among them are fixed fees, time-based fees, time-based periodic retainer, and asset-based fees." (Practitioners Publishing Company)
Stop That 401(k)! Shifting to Taxable Investments When Nearing Retirement Age
Excerpt: "In some cases, late in your career--say, five years from retirement--it makes sense to stop contributing to tax-deferred accounts and stash your money in a taxable low-cost stock-index fund instead. Why? Because the compounding effect of tax-free investing needs years to overcome the higher tax rate applied to such accounts at the time of withdrawal." (Time.com)
Spencer Survey of Benefits Managers Is Underway
Charles D. Spencer & Associates, Inc., continues to collect information for its 2001 Spencer survey of benefits managers and employee benefits departments. This 8th biennial survey requests information concerning compensation, organization, and functional responsibilities of corporate employee benefits departments. The information provided will be collated and published by Charles D. Spencer & Associates, Inc. All survey participants receive a copy of the published survey at no charge. (SpencerNet)
Unhappy Investors Sound Off At Sprint Annual Meeting, Question Executive Benefits
Excerpt: "The investment fund represented by Hitchcock sponsored a proposal requiring that shareholders give approval to any future severance agreements that exceed 200 percent of a senior executive's base salary. The proposal was defeated, but the preliminary count on Tuesday did show the measure garnering more than 33 percent approval." (Reuters via Excite News)
Cisco's Option Plan Opens Door For Others To Make Adjustments
Excerpt: "Cisco Systems' disclosure this week that it will grant new stock options to help compensate employees for options that are currently worthless is interesting for two reasons. One, it could mean that Cisco execs think their company's stock price has bottomed. Two, it could encourage other battered tech companies to reprice or supplement underwater options." (San Francisco Chronicle)
Some Suffer Tax Hangovers From Microsoft Option Spree
Excerpt: "Now that Microsoft's stock has fallen to about half its peak, Seattle is abuzz with other stories, those of Microsoft employees deep in debt and filing for bankruptcy." (New York Times; free registration required)
Newly Posted or Renewed Job Openings (Post Yours!)
| Retirement System Specialist | for Levi, Ray & Shoup, Inc. (IT Company) in IL |
| Benefits Administrator | for Lyondell Chemical Company in TX |
| Sr. Benefits Administrator | for Lyondell Chemical Company in TX |
| Plan Coordinator | for Union Bank of California in CA |
| Trust Administrator | for Union Bank of California in CA |
| Senior Service Consultant | for Transamerica Life Companies in CA, IL |
| Regional Compliance Manager | for Transamerica Life Companies in CA |
Newly Posted Conferences (Post Yours!)
| Western Pension & Benefits Conference Phoenix Chapter 2001 Spring Conference | in AZ on May 24, 2001 presented by Western Pension & Benefits Conference, Phoenix Chapter |
| COBRA; HIPAA; Section 125; and FMLA-Grand Rapids | in MI on April 23, 2001 presented by A.E. Roberts Company |
| COBRA; HIPAA; Section 125; and FMLA-Detroit | in MI on April 25, 2001 presented by A.E. Roberts Company |
| FMLA; Coordinating FMLA, ADA, and Workers' Comp; COBRA; HIPAA; and Section 125 - Allentown | in PA on April 23, 2001 presented by A.E. Roberts Company |
| FMLA; Coordinating FMLA, ADA, and Workers' Comp; COBRA; HIPAA; and Section 125 - Birmingham | in AL on April 24, 2001 presented by A.E. Roberts Company |
| FMLA; Coordinating FMLA, ADA, and Workers' Comp; COBRA; HIPAA; and Section 125 - Cleveland | in OH on April 24, 2001 presented by A.E. Roberts Company |
| FMLA; Coordinating FMLA, ADA, and Workers' Comp; COBRA; HIPAA; and Section 125 - Omaha | in NE on May 1, 2001 presented by A.E. Roberts Company |
| Integrating HR Delivery Channels | in IL on July 23, 2001 presented by IQPC |
| FMLA; Coordinating FMLA, ADA, and Workers' Comp; COBRA; HIPAA; and Section 125 - Tucson | in AZ on May 1, 2001 presented by A.E. Roberts Company |
| FMLA, Coordinating FMLA, ADA, and Workers' Comp, COBRA, HIPAA, and Section 125 - Evansville | in IN on May 1, 2001 presented by A.E. Roberts Company |
| FMLA, Coordinating FMLA, ADA, and Workers' Comp, COBRA, HIPAA, and Section 125 - Long Island | in NY on May 1, 2001 presented by A.E. Roberts Company |
| FMLA, Coordinating FMLA, ADA, and Workers' Comp, COBRA, HIPAA, and Section 125 - Phoenix | in AZ on May 15, 2001 presented by A.E. Roberts Company |
| FMLA, Coordinating FMLA, ADA, and Workers' Comp, COBRA, HIPAA, and Section 125 - Indianapolis | in IN on May 8, 2001 presented by A.E. Roberts Company |
| FMLA, Coordinating FMLA, ADA, and Workers' Comp, COBRA, HIPAA, and Section 125 - Las Vegas | in NV on May 30, 2001 presented by A.E. Roberts Company |
| FMLA, Coordinating FMLA, ADA, and Workers' Comp, COBRA, HIPAA, and Section 125 - Louisville | in KY on May 22, 2001 presented by A.E. Roberts Company |
| FMLA, Coordinating FMLA, ADA, and Workers' Comp, COBRA, HIPAA, and Section 125 - Miami | in FL on May 22, 2001 presented by A.E. Roberts Company |
| FMLA, Coordinating FMLA, ADA, and Workers' Comp, COBRA, HIPAA, and Section 125 - Davenport | in IA on May 22, 2001 presented by A.E. Roberts Company |
| FMLA, Coordinating FMLA, ADA, and Workers' Comp, COBRA, HIPAA, and Section 125 - Des Moines | in IA on May 15, 2001 presented by A.E. Roberts Company |
| FMLA, Coordinating FMLA, ADA, and Workers' Comp, COBRA, HIPAA, and Section 125 - Arlington | in VA on May 8, 2001 presented by A.E. Roberts Company |
| FMLA, Coordinating FMLA, ADA, and Workers' Comp, COBRA, HIPAA, and Section 125 - Baltimore | in MD on May 15, 2001 presented by A.E. Roberts Company |
| FMLA, Coordinating FMLA, ADA, and Workers' Comp, COBRA, HIPAA, and Section 125 - New York | in NY on May 22, 2001 presented by A.E. Roberts Company |
| FMLA, Coordinating FMLA, ADA, and Workers' Comp, COBRA, HIPAA, and Section 125 - Parsippany | in NJ on May 8, 2001 presented by A.E. Roberts Company |
| FMLA, Coordinating FMLA, ADA, and Workers' Comp, COBRA, HIPAA, and Section 125 - Albany | in NY on June 12, 2001 presented by A.E. Roberts Company |
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