| BenefitsLink Retirement Plans Newsletter |   |
June 30, 2003 - 13,217 subscribers
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IRS Calls 'Unreasonable' a Type of Aggregate Entry Age Normal Funding Method for DB Plans
Excerpt: "[T]he aggregate entry age normal funding method that determines the normal cost per plan participant by dividing the sum of the present values (determined as of each participant's entry age) of each participant's projected benefits by the sum of the present values (determined as of each participant's entry age) of an annuity for each participant equal to 1 per year payable from the participant's entry age until ... retirement age does not constitute a reasonable funding method ..." (Internal Revenue Service)
GM Opposes Pension Disclosure Changes
Excerpt: "General Motors Corp., struggling with its underfunded U.S. pension plan, said on Friday it opposed an accounting rule currently being developed to improve disclosure on corporate pension plans." (Reuters via Lycos News)
Opinion: Better to Limit Number of Vendors in 457/403(b) Plans
Excerpt: "Researchers at Columbia University have found that choice overload in retirement plans leads to less participation. Their key findings: 'after controlling for the employer match, participant demographics, and other variables, the probability that an employee will join a savings plan decreases modestly as the number of options increases.' More precisely the researchers report: Every additional 10 investment choices on average reduces predicted participation rates by 2 percent." (403bWise.com)
Understanding the Impact of Employer Matching on 401(k) Saving
(Click on 'PDF Version' button on target page.) Excerpt: "This article summarizes current research on the impact of employer matching on 401(k) saving. In particular, the authors outline the reasons why this impact is difficult to identify and describe their research with the Health and Retirement Study." (TIAA-CREF Institute)
Europe's Retired Face Pension Squeeze
Excerpt: "The changing demographic picture has produced political uncertainty and crowds of angry demonstrators in European countries whose governments, reacting to the shift from youth to the aged, are moving to reduce social services, including the pensions that millions have been counting on for their golden years." (International Herald Tribune)
Employee Ownership Update for June 27, 2003
NCEO Executive Director Corey Rosen discusses new rules the SEC has approved for the New York Stock Exchange and the NASDAQ for shareholder approval of equity plans; proposed regulations governing incentive stock options and employee stock purchase plans; and a Department of Labor suit against ESOP fiduciaries. (National Center for Employee Ownership)
Survey: Mutual Funds and the U.S. Retirement Market in 2002 (PDF)
16 pages. Excerpt: "Both Individual Retirement Account (IRA) and employer-sponsored defined contribution plan assets experienced declines." (Investment Company Institute)
Federal Reserve Bank Report Explains Tricky Rules On Reporting Pension Plan Health
Excerpt: "When you check out a company's financial condition, be careful about what the company says concerning its pension costs. Its condition may be worse than it appears. The Federal Reserve Bank of San Francisco ... is issuing a report on the issue this week by its research advisor Simon Kwan. It explains how current accounting practices for corporate pension funds blur reality." (Pacific Business News via bizjournals.com; one-time registration required)
Links to Items on Executive Comp, Benefits in General
SEC To OK New Stock Option Rules
Excerpt: "The Securities and Exchange Commission is expected to sign off Monday on stock-exchange rules that will require companies to give shareholders a chance to vote on stock-option and other compensation plans -- many of which are currently shrouded in secrecy." (The [San Jose, Calif.] Mercury News)
Newly Posted or Renewed Job Openings
Client Communication Specialist/Sr.
for Standard Insurance Company
in OR
Compliance Analyst
for T. Rowe Price
in MD
Training Coordinator
for BISYS
in PA
Retirement Services Account Manager 3
for Wells Fargo
in CA
Pension Actuarial Consultant
for FPL Group
in FL
Newly Posted Press Releases
(Post Yours!)
IRS Reminds Some Businesses of Retirement Plan Deadline
(Internal Revenue Service)
New Study Finds Americans Underestimate Life Expectancy and Amount of Money Needed During Retirement
(GE Center for Financial Learning)
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