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The BenefitsLink Newsletter -
Retirement Plans Edition
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August 27, 2002 - 11,780 subscribers
Today's sponsor: APSCREEN, Employee Locator

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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)

Review of Catch-Up Contribution Opportunities, With Examples (PDF)
At page 4 of 12. Excerpt: "For plan sponsors, implementing a catch-up feature for participants aged 50 and older entails several issues that must be considered carefully. This article provides answers to key questions and examples, where appropriate, of EGTRRA's catch-up rules." (Milliman USA)

Effect of Stock Price Declines on the Accounting for Pensions (PDF)
6 pages. Excerpt: "The decline in stock prices may result in questions regarding its effect on employers' accounting under FASB Statement No. 87, Employers' Accounting for Pensions [such as] whether a company is required to remeasure its assets and liabilities at an interim date as a result of the recent stock market decline; whether recognition of a minimum pension liability is required at an interim date; the effect of the stock market decline on current and future year pension expense ..." (Ernst & Young, published by the Financial Executives Institute)

Full Text of ERISA Opinion on Minimum Contacts Needed for Jurisdiction Over Pension Fund (PDF)
13 pages; Waeltz v. Delta Pilots Retirement Plan (No. 01-1838, 7th Cir. 2002). Excerpt: "An ERISA fund 'may be found' in a judicial district under 29 U.S.C. section 1132(e)(2), if it has the sort of minimum contacts with that district that would support the exercise of personal jurisdiction under International Shoe Co. v. Washington." (U.S. Court of Appeals for the Seventh Circuit, via

Full Text of Most Recent Harris Trust v. John Hancock Opinion
Harris Trust and Savings Bank v. John Hancock Mutual Life Insurance Company (No. 01-7608, 2d. Cir. 2002). Excerpt: "Defendant's refusal to permit an employer to roll over free funds under a formula different from that called for in a group annuity contract, and refusal to revalue 'Liabilities of the Fund,' did not constitute a breach of its fiduciary duties under ERISA." (U.S. Court of Appeals for the Second Circuit, via

Overview of the Saver's Tax Credit (PDF)
Excerpt: "Low- and moderate-income workers have been given a new reason to contribute toward their retirement plans: a tax credit created under last year's tax law (the Economic Growth and Tax Relief Reconciliation Act, EGTRRA). The temporary saver's tax credit ... may offer sufficient incentives to take the initial step of securing retirement income for those who can benefit. Retirement plan sponsors should consider communications efforts to educate employees about the saver's tax credit." (Milliman USA)

Bonds Offer Protection from Inflation for Retiree Investors
Excerpt: "iBonds ... can be purchased online or at financial institutions at no cost. They can also be purchased in denominations as small as $50. They currently yield 2 percent plus the rate of inflation. The entire return is tax deferred until the bonds are redeemed. While they will always provide a yield equal to the inflation rate, the 2 percent of 'real' return is reset every six months for bonds purchased in each period." (Scott Burns in the Dallas Morning News; free registration required)

White Paper: Retirement Is Out of Reach (PDF)
12 pages. Excerpt: "The risks of relying on financial markets for adequate retirement income are immediately apparent upon examining what has happened in recent years to retirement wealth for the average household." (Economic Policy Institute)

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

Benefits and the Middle-Age Boom (PDF)
At page 7 of 12. Excerpt: "The baby boomers are now middle aged.... Before boomers can get old, they have to get older. The important demographic transformation of today is the increasing number of middle-aged adults in the workforce. For human resource and benefit managers, the effect of this shift will be substantial. This article discusses how the physiological changes of middle adulthood taking place in such a large generation will affect employee benefit programs." (Milliman USA)

Eighth Circuit Drops Presumption in Favor of Prevailing Plaintiffs When Awarding ERISA Attorney Fees
Martin v. Arkansas Blue Cross and Blue Shield (8th Cir. 2002). Excerpt: "In this case, the entire panel of the Eighth Circuit has changed the court's stance on the award of attorneys' fees to prevailing plaintiffs in ERISA cases.... Even though the overwhelming majority of the federal circuits apply no presumption in favor of prevailing plaintiffs, the Eight Circuit was-- up to now-- one of the courts that applied the presumption ..." (EBIA Weekly)

Section-by-Section Overview of Sarbanes-Oxley Act (PDF)
9 pages. (Financial Executives Institute)

Summary of the Rank and File Stock Option Act of 2002 (PDF)
3 pages. Excerpt: "On August 1, 2002, Senator Joseph Lieberman (D-CT) introduced the Rank and File Stock Option Act of 2002 (S.2877). Senator Lieberman said that unlike proposals to change the accounting rules for options, his legislation would go a long way toward discouraging the abuse of options without diminishing their use, which has played a critical role in increasing the income and assets of millions of middle class families." (Frederic W. Cook & Co., Inc.)

Newly Posted or Renewed Job Openings - Post a Help Wanted Ad

Marketing Consultant (Conversion & Case Management)
for WESPAC Plan Services, Inc. in CA

Pension Administration Team Leader
for Sentinel Benefits Group in MA

Pension Sales Consultant
for Long Island Employee Benefits Group Ltd. in NY

Senior Benefits Analyst - Contract Position
for in CA

Qualified Retirement Plan Administrator
for Benefits Integrity in CO

Plan Specialist
for Transamerica in CA

Newly Posted Conferences (Post Yours!)

Tales from the Crypt: De-mystifying the Actuarial Process
in OH on September 19, 2002
presented by WEB, Worldwide Employee Benefits Network

Newly Posted Press Releases

Alexander Hamilton Institute Releases New Free Report - "State Reference Immunity Laws"
(Alexander Hamilton Institute)

New Section 125 Benefit Protects Children and Their Families
(Global Work/Life Solutions)

Subscribe to the Welfare Plans Edition, too (click)

Feel free to send this email to friends, colleagues or clients, if you copy or forward this email in its entirety (including this boilerplate part). Copyright 2002, Inc.

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