| The BenefitsLink Newsletter - Retirement Plans Edition |  |
September 7, 2001 - 12,551 subscribers
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401(k) Plan Features-- Employee Benefit or Employer Burden? (PDF)
3 pages; originally published in the autumn of 1999. Excerpt: "Many 401(k) plans have a complexity or two, generally because a sponsor includes certain plan features. The purpose of this article is not to find fault with those plans' designs but to simply raise plan sponsors' awareness of different options and to consider the administrative issues regarding a plan feature. In this article, the focus is on eligibility requirements." (Milliman USA)
The Cash Balance Plan Controversy (PDF)
3 pages; originally published in the winter of 1999. Excerpt: "Should employers considering cash balance plans abandon their initiatives? Will Congress or the federal agencies make switching to a cash balance plan difficult or impossible even though doing so makes sense from a business standpoint? The answer to these questions is an emphatic 'No.' But there are sensitive areas to which employers must pay careful attention when examining cash balance plans." (Milliman USA)
ERIC Provides Comments to IRS on New Notice Required for Upcoming Reduction in Benefit Accruals
Excerpt: "We have prepared this memorandum at the request of the Office of Benefits Tax Counsel to identify the legal authorities defining 'early retirement benefit,' 'retirement-type subsidy,' and 'optional form of benefit' and to address the question whether the notice requirement imposed by Code §4980F applies to a plan amendment that prospectively eliminates an optional form of distribution ... where the optional form has been available to distribute a subsidized retirement benefit." (ERISA Industry Committee)
Year-end Deadline for Retirement Plans
Excerpt: "The types of changes that [tax-qualified] plans must make are mostly technical, and relate to ... credits for military service, repeal of family aggregation rules and of Section 415(e) limits, the 401(k) discrimination testing rules (including the definition of highly-compensated employee), and the age 70-1/2 minimum required distribution rules." (XPay.net)
Another Question is Answered in the Stop, Look & Listen: Railroad Retirement Q&A Column
Amtrak is offering early retirement to employees 55 or older. The company will pay a supplement equal to what I would receive at 66 if I continued to work for them. Those who accept the offer must retire by December 31, 2001. What would the Tier 1 and Tier 2 tax status of the Amtrak supplement? How would accepting early retirement affect my "current connection" status under Railroad Retirement and my years of service credits? (BenefitsLink.com)
Vanguard's Indexing Chief Manages Actively Managed Funds Too: Market "Not Totally Efficient"
Excerpt: "The August issue of Institutional Investor explores an apparent paradox: Gus Sauter, Vanguard's indexing chief, also manages Vanguard® Strategic Equity Fund and pieces of three other actively managed funds ... using a quantitative approach. How is that possible? Although Sauter feels that the odds are stacked against investors in actively managed funds, he also believes that the market is not totally efficient. For the full story, read 'Gus vs. Gus' in Institutional Investor." (The Vanguard Group, Inc.)
Privatized Social Security Funding Gets Boost
Excerpt: "For six hours [Thursday Sept. 6, 2001], as they collected public testimony for the first time, members of a White House commission examining Social Security expressed grave concerns about its future and said that partially privatizing the retirement program might be the only way to save it." (Washington Post)
The Social Security Debate Plays San Diego
Excerpt: "Before a sparse crowd and in a sober setting that felt more Washington than Southern California, a presidential commission dedicated to overhauling Social Security convened its first public hearing today, absorbing darts and laurels from academics, lobbyists and local residents. In substance, the six hours of testimony did not produce anything new or surprising. People discussed the core issue of revamping Social Security to let workers invest in stocks and bonds." (New York Times; free registration required)
Newly Posted or Renewed Job Openings (Post Yours!)
| Compliance Administrator | for Delaware Investments in PA |
| Testing Compliance Manager | for The 401(k) Company in TX |
Newly Posted Press Releases
| DailyAccess.Com compliance to be overseen by McKendry (DailyAccess.Com) |
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Copyright 2001 BenefitsLink.com, Inc., but you may freely distribute this email newsletter in whole. This newsletter is edited by David Rhett Baker, J.D.
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