| The BenefitsLink Newsletter - Retirement Plans Edition |   |
December 4, 2001 - 12,718 subscribers
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(Help BenefitsLink to provide this newsletter at no charge to you -- our sponsors pay our way. Remember to visit them periodically; we try to make sure their products and services will be of interest to you. Thanks! --Editor)
Eight Ways to Raise the 401(k) Savings Rate of Generation X Nonhighly Compensated Employees
Excerpt: "As year-end approaches and 401(k) nondiscrimination tests are done, nothing is more aggravating than having to give back deferred money to your executives and highly compensated employees. To many 401(k) plan managers, this represents a plan failure that can't be countered unless those ubiquitous Generation Xers can be convinced to put more--or even some--money into their plan." (IOMA's Report on Managing 401(k) Plans)
Auto Parts Maker Suspends 401(k) Matching Contributions
Excerpt: "Visteon Corp. has joined other major players in the auto industry that are trying to save money by suspending contributions to employee retirement accounts.... The 401(k) contributions will 'resume as quickly as affordable,' Chairman Peter Pestillo said in the e-mail. The move will save about $25 million a year." (Auto.com)
Ford Eliminates 401(k) Matching Contribution Effective January 1, 2002
Excerpt: "Ford said it was suspending its employee retirement plan, or 401(k), matching contributions as of Jan. 1 and eliminating merit pay hikes for 2,200 top-level managers for 2002. The job and 401(k) cuts are aimed at saving the company about $300 million per year, Ford said." (Reuters Health via Excite News)
Members of Congress Join Council and Others' Call for Pension Funding and Premium Relief By Year-End
Excerpt: "The American Benefits Council, leading a group of eight trade associations, [has] urged Congress to provide pension funding and premium payment relief before year-end through the economic stimulus bill currently being considered." (American Benefits Council)
Another Question is Answered in the Correcting Plan Defects Q&A Column
When correcting a qualification failure under IRS Revenue Procedure 2001-17, 2001-7 IRB 589 ("Rev. Proc. 2001-17"), can assets be removed from a plan to effect correction? (BenefitsLink.com)
Another Question is Answered in the Stop, Look & Listen: Railroad Retirement Q&A Column
I understand that after I retire, I can not return to work at my last nonrailroad employer. There must be some exceptions. How can I find out what they are without going to a lawyer? (BenefitsLink.com)
CRT Plus ESOP - a Win/Win Combination
Excerpt: "It is rare that we come upon an opportunity to combine two tax provisions-- each of which provide major tax saving opportunities in their own right-- to create an exceptionally attractive 'package deal.' One such opportunity can be found by coupling employee stock ownership plans (ESOPs) with charitable remainder trusts (CRTs)." (Louis Diamond, Esq., published by Foundation for Enterprise Development)
Railroad Retirement Bill Advances in U.S. Senate
Excerpt: "A bill to let some railway pension funds be invested on Wall Street advanced in the U.S. Senate on Monday after a Republican attempt to attach unrelated amendments on energy and human cloning failed." (Reuters Health via Yahoo! News)
Overview: IRS Extends GUST Amendment Deadline (PDF)
Excerpt: "The IRS has again extended the deadline for updating plans to include provisions required by 'GUST'." (CIGNA's Pension Analyst)
What It Takes to Capture the Hearts, Minds and Future Assets of DC Plan Sponsors
Excerpt: "Providers that dominate the market will be those that best comprehend the competitive terrain and the growing patterns of the industry, as well as the future needs of sponsors and are then able to incorporate that knowledge into their business strategies. That makes it essential for providers hopeful of increasing their market share over the next few years to understand the various dynamics that will be influencing the industry as it evolves." (IOMA's DC Plan Investing)
Opinion: a 401(k) Lesson From Enron
Excerpt: " An Oregon employee who has lost $400,000 has triggered a class action suit. Where does investor stupidity end and where does a legitimate lawsuit begin?" (Contra Costa Times)
Opinion: 401(k) Can't Rely on One Firm's Stock
Excerpt: "As of Oct. 31, 29.6 percent of assets in 401(k) plans tracked by Hewitt Associates, the benefits consulting firm, were tied up in company stock. Hewitt found that 55 percent of plans offered the employer's stock as an investment option. Among those plans, 45 percent made the employer's matching contribution only in the company's stock." (The [Philadelphia] Inquirer)
IRS Proposes Employment Tax Rules Detrimental to Incentive Stock Option Programs
Excerpt: "Shortly before the Thanksgiving holiday, the Internal Revenue Service published proposed rules that many sponsors of employee stock purchase plans (ESPPs) and granters of incentive stock options (ISOs) may view as unappetizing. Under these rules, which are proposed to be effective beginning in 2003, employers and participants may find ISOs and ESPPs to be less attractive and more expensive through the imposition of employment taxes ..." (Scott Kilgore & Barclay Collins, published by Foundation for Enterprise Development)
IASB Debates Income Statement Recording of Equity Compensation
Excerpt: "The International Accounting Standards Board (IASB) is facing a tough fight over its plans to adopt new accounting rules that would require companies to record the cost of equity-based compensation paid employees, and outside contractors and consultants in their income statements." (KPMG LLP's Washington National Tax practice, published by Foundation for Enterprise Development)
Newly Posted or Renewed Job Openings (Post Yours!)
| Analyst 401(k) Plan Administrator | for J. D. Benefits, Inc. -- Chapel Hill, North Carolina in NC |
| Actuary - Senior Consultant | for Global HR Consulting Firm in DC |
| Retirement services (outside) sales representative- selling direct | for National Retirement Services Financial Institution in CA, OH, TX |
| Client Relationship Consultant | for Ceridian in VA |
| Senior Plan Administrator | for Ceridian in VA |
| 401(k) Sales | for Alliance Benefit Group Of New England in MA, NH |
| Employee Benefits Attorney | for Thompson Hine LLP in DC |
| CONVERSIONS, TEAM LEADER | for Charles Schwab & Co., Inc. in OH |
| Retirement Plan Services Administrator | for Wayne County National Bank in OH |
Newly Posted Press Releases
| Powerful New Employer Plan Sponsor Database Introduced! (401kExchange) |
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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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