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The BenefitsLink Newsletter -
Retirement Plans Edition
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July 9, 2002 - 11,391 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)

Hewitt Study Says 401(k) Participants Not Making Many Changes in Investments
Excerpt: "In 2001, only 19.5 percent of active 401(k) participants made any form of trade. This is down substantially from 2000, when 30 percent of participants made at least one trade.... [T]he attitude of inertia took its toll on 401(k) participants' asset allocation. While at year-end 2000, 81 percent of 401(k) plan assets were invested in equity investments, by the end of 2001, that proportion had declined to 76 percent." (Business Wire via Yahoo! News)

Overview of Changes in the Updated EPCRS Procedures
Excerpt: "This year's update provides only a few substantive changes. Most of the modifications are in the nature of clarifying statements or to include new addresses or updated cross-references to other procedures or rulings. The following is a list of the substantive changes and the more important clarifications." (TRI Pension Services)

The Global Retirement Crisis: the Threat to World Stability and What to Do About It (PDF)
97 pages; April 2002. Excerpt: "Over the next few decades, [global ageing] will restructure the economy, reshape the family, and even rearrange the world order. Along the way, it will compel both the public and private sectors to rethink retirement systems which once seemed affordable ... [T]he recent financial crises in Asia and Argentina pale before what lies ahead if the major developed economies fail to reform their retirement systems-- and soon." (Center for Strategic and International Studies)

Pension Losses Will Hurt Many Firms' Bottom Lines
Excerpt: "Corporate pension funds ... are running short of money. Rather than earning income on their investments, these large pools of wealth that pay out benefits to retirees are suffering losses along with the stock market. The declines don't threaten pensioners' incomes.... But the pain will begin to hit corporate bottom lines this year and next as hundreds of companies start recognizing the losses on their earnings reports -- and start putting in more money to shore up underfunded plans." (The Seattle Times)

Another Question is Answered in the Who's the Employer Q&A Column
You've mentioned several times that you are working on a third edition of your book, Who's the Employer. When will it be available? Will it be available electronically? (BenefitsLink.com)

Social Investments Fund Pressures AT&T on Cash Balance Plan
Press release. Excerpt: "Domini Social Investments ... announced [July 8] that it will press forward with a shareholder resolution at the July 10, 2002 annual meeting of AT&T Corp., calling on the company to restore certain pension benefits to long-serving employees.... In 1997, AT&T converted its defined benefit pension plan to a cash balance plan. The shareholder resolution seeks to address the method AT&T chose to effect this conversion ..." (Business Wire via Yahoo! News)

Annuities for an Ageing World
48 pages. Working paper by Olivia S. Mitchell and David McCarthy, temporarily available for downloading. Excerpt: "[A]nnuities [are] financial products intended to cover the risk of retirees outliving their assets. This paper reviews and extends recent research examining the role of annuities in helping finance retirement consumption. We also examine key market and regulatory factors." (Pension Research Council)

Washington Voters to Decide Whether to Reduce Legislative Control Over Police, Firefighter Pensions
Excerpt: "A measure headed for the November ballot will ask voters to make a seemingly minor change in the governance of pensions for firefighters and police officers. But it's not minor for 13,000-plus union police officers and firefighters, who would get more power over their pensions." (The Seattle Times)

Links to Items on Executive Comp, Benefits in General
(These items appear in both editions of the BenefitsLink Newsletter)

Bar Committee Releases 2002 Q&As with Labor Department Officials
Excerpt: "Each year, the Joint Committee on Employee Benefits (JCEB) of the American Bar Association meets with officials of federal agencies ... The question and answer transcripts listed below are based on these informal discussions between private sector representatives of the JCEB and agency officials.... The responses reflect the unofficial, individual views of the government participants as of the time of the discussion, and do not necessarily represent agency policy." (American Bar Association, Joint Committee on Employee Benefits)

Another Large Company Begins Voluntarily Expensing Stock Options
Excerpt: "AMB Property Corp., a San Francisco real estate investment trust, has voluntarily begun deducting employee stock options as a compensation expense on its income statement. AMB is believed to be the first company to take this step since Enron and WorldCom imploded under accounting scandals and reheated the long-simmering debate over stock option accounting." (San Francisco Chronicle via Society for Human Resource Management)

Newly Posted or Renewed Job Openings - Post a Help Wanted Ad
Business Analyst for CNA Trust
in CA
Retirement Plan Administrator for InWest Pension Management, Inc.
in TX
Actuary for USI Consulting Group, Inc. (USICG)
in CT, NY
Part Time, 401 (k) Enroller/ Contractor - Bilingual for Transamerica
in FL, GA, IL, PA, TX
Part time 401 (k) Enroller/ Contractor for Transamerica
in FL, GA, IL, TX
Retirement Plan Consultant - Portland, ME for Invesmart, Inc
in ME

Newly Posted Conferences (Post Yours!)
New Guidelines on Health Reimbursement Arrangements: What Do They Mean for You? Teleweb Seminarin ALL STATES on July 18, 2002
presented by International Foundation of Employee Benefit Plans
Schwab Retirement Technologies Annual Conferencein TX on September 17, 2002
presented by Schwab Retirement Technologies

Newly Posted Announcements of Promotions and New Personnel (Post Yours!)
Eric Calhoun (Lawson & Fields P.C.)

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Editor and Publisher: David Rhett Baker, J.D.