| BenefitsLink Retirement Plans Newsletter |   |
September 20, 2004
Today's sponsor: Natalie Choate's Life and Death Planning for Retirement Benefits
(Click on company name or banner to learn more.)
The Essential Handbook for Estate Planners Do your clients expect you to know the best planning ideas for their IRAs and other retirement plans and the pitfalls to avoid? If so, Natalie Choate's book Life and Death Planning for Retirement Benefits will be an invaluable resource for your work. Thousands of pros swear by this handy desk reference, which covers everything from basic (such as minimum required distributions, pre-age-59½ distributions, trusts as beneficiaries) to advanced (such as disclaimers, non-citizen spouse, life insurance, TEFRA 242(b)). Including the forms, checklists and tables, you get 500 pages packed with information to help you win clients and avoid lawsuits.
(Please visit our sponsors. We try to make sure their products and services will be of interest to you. Thanks! --Editor)
401(k) Charges Attract Scrutiny As Latest Scandals Put Spotlight on Little-Recognized Fees
Excerpt: "Earlier this year New York law firm Schulte Roth & Zabel LLP did something unexpected for its employees. It persuaded Wachovia Corp. to slash the fees charged by the bank to run Schulte Roth's retirement plan." (Wall Street Journal via The Charlotte Observer; one-time registration required)
Overview: the Opportunity Cost and Fiduciary Implications of Retirement Plan Fees
Excerpt: "In the aftermath of the Enron and WorldCom litigation and the Mutual Fund trading scandal, stands the often hidden and misunderstood world of retirement plan fees in the 401k marketplace." (Attorney Jeff Robertson on 401khelpcenter.com)
Some Irony in Alabama Pension Fund Investments
Excerpt: "Usually pension funds try to protect employee benefits, but that doesn't always hold true when they are looking to make money themselves... There aren't any rules prohibiting pension funds from investing in companies that are trying to eliminate their pension plans. But when it does happen, it puts the funds in a predicament." (AP via Chicago Sun-Times)
Retirement Income Planning, Part 4: Beyond Monte Carlo
6 pages. Excerpt: "The essence of the Monte Carlo approach is to create a large number – usually a few thousand – randomly generated scenarios, compute the financial characteristics of each scenario, and then compile the results to determine the overall likelihood of a satisfactory outcome. This is a useful exercise, and helpful to a point, but in the context of financial planning for retirees, it is off the mark. There are four main reasons for this: ..." (Still River Retirement Planning Software)
IBM Continues Settlement Talks in Cash Balance Pension Plan Case
Excerpt: "The judge presiding over a massive pension suit against IBM, which could cost the company more than $6.5 billion, agreed Friday to a short delay while settlement talks continue. The suit, which contends the 'cash balance' pension plan the company adopted in the 1990s discriminated against 140,000 older workers, has been closely watched by scores of large companies that switched to similar pension plans in the 1980s and 1990s." (AP via The Washington Post; one-time registration required)
Relative Values for Distributions: a New Requirement for Pension Disclosures
Excerpt: "At the end of 2003, the Internal Revenue Service (IRS) issued final regulations significantly expanding the disclosure requirements for private-sector pensions that are subject to the Qualified Joint and Survivor Annuity (QJSA) requirements of ERISA." (Employee Benefit News)
A Renewed Push to Help Federal Workers Move Into the Correct Retirement System
Excerpt: "The Office of Personnel Management is making another push to resolve cases of federal employees placed in the wrong retirement system. Numerous employees have complained about the slow pace in fixing errors that were made by their agencies …. Widespread concerns about the issue surfaced about seven years ago, prompting Congress to pass the Federal Erroneous Retirement Coverage Corrections Act of 2000." (The Washington Post; one-time registration required)
Towers Perrin Legislative Tracking Chart: Retirement Issues: Updated September 16, 2004 (PDF)
Excerpt: "These charts summarize selected federal legislation that would affect employee benefit programs. The bills included on the charts are based on judgments regarding the prominence of the issue, the likelihood of enactment, and the influence of the sponsors." (Towers Perrin)
Lower Plan Expenses and Fees Coming to Retirement Plans Along With Better Investment Options
Excerpt: "Employees, get ready for lower fees and improved investment options in your company-sponsored retirement plan. A new study by Mercer Investment Consulting reveals that companies are paying more attention to employee nest eggs amid regulators' focus on fees and improper mutual-fund trading." (AP via The Boston Globe)
Opinion: Why You Hate, and Like, Social Security
Excerpt: "I asked readers for comments, especially regarding whether we should believe the math behind the 'The Social Security Personal Savings Guarantee and Prosperity Act of 2004.' .... In this article, I'll summarize the most common comments, followed by a few quotes from readers. I don't agree with all these responses; I include them to show the diversity of opinions on this issue." (Robert Brokamp on The Motley Fool)
49% of Pension Plan Sponsors Provide Investment Advice To Participants, Survey Finds
Excerpt: "According to a survey conducted jointly by the Society for Human Resource Management (SHRM), the Employee Benefit Research Institute, and WorldatWork, 49% of pension plan sponsors provide retirement investment advice to participants. The survey garnered responses from 801 benefits and compensation specialists. The survey defined investment advice as customized financial planning and investment counseling to meet the specific goals and needs of an individual employee." (Spencer Benefits Reports)
Links to Items on Executive Comp, Benefits in General
Negotiations and Concessions Provide Difficult Choices for Airline Union Members
Excerpt: "Leonard Robinson, who put in 30 years as a mechanic at Pan American World Airways, has a message for his counterparts at US Airways, Delta, United and other struggling airlines pressing their workers for concessions: do not wait until it is too late." (The New York Times; one-time registration required)
US Airways Said to Plan to Ask Court for Temporary Pay Cuts for Workers
Excerpt: "US Airways plans to ask a federal bankrup.tcy judge on Oct. 7 to impose temporary pay cuts on its workers unless it can reach agreement with its unions before then, people who have been briefed on the company's strategy said yesterday." (The New York Times; one-time registration required)
Louisiana Voters Approve Ban on G.ay Marriage and Civil Unions
Excerpt: "Amendment opponents vowed to fight the legislation in court. They said it put in danger domestic partner benefits provided by private companies and local governments, including the city of New Orleans." (Reuters via The New York Times; one-time registration required)
Hot Issues Will Go Directly to State Voters on Election Day: G.ay Marriage Among Initiative Questions
Excerpt: "Election Day will offer voters in more than 30 states an opportunity to vent their feelings on a variety of social and legal issues, from same-sex marriage to bear baiting to caps on medical malpractice awards." (The Washington Post; one-time registration required)
Executive Pay: the Lasting Investor/Corporate Governance Battle Cry
Excerpt: "Big-ticket executives and the directors who bankroll them will be top targets for activist shareholders as the proxy campaigns for next year's annual corporate meetings get under way, governance experts predict." (Reuters via The New York Times; one-time registration required)
Outlook for Benefits Under a 'Fairer' Tax Code
Excerpt: "Thanks to the TaxProfBlog for the pointer to this blog which posts a document ... providing proposals for possible avenues of tax reform that might be utilized in trying to achieve a 'fairer' system. The document provides some insight into how retirement plans and other benefits might be affected in such proposal." (Attorney B. Janell Grenier on BenefitsBlog.com)
Senate Committee Provision Requires Employers Comply With Old & New White Collar Overtime Rules
Excerpt: "In the past two weeks, the House and Senate have passed politically-motivated amendments to their respective versions of the FY 2005 DOL funding bill that would impede DOL enforcement of, but not repeal, the new FLSA 'white collar' regulations." (HR Policy Association)
Towers Perrin Legislative Tracking Chart: Human Resource Issues: Updated September 16, 2004 (PDF)
Excerpt: "These charts summarize selected federal legislation that would affect employee benefit programs. The bills included on the charts are based on judgments regarding the prominence of the issue, the likelihood of enactment, and the influence of the sponsors." (Towers Perrin)
Birth Dearth: An Examination of the Potential Consequences of the Worldwide Population Implosion
Excerpt: "Remember the population bomb? The new threat to the planet is not too many people but too few." (Newsweek via MSNBC News)
California County Takes Hit from Surprising Source
Excerpt: "[A] key factor that drives up county costs and comprises about half of the county's $633 million in annual expenditures [is] salaries and benefits for more than 4,000 employees. Those costs have grown 39 percent in the last five years, with 70 percent of that growth coming from salaries alone." (The Lompoc Record)
Newly Posted or Renewed Job Openings
Group Proposal & Underwriting Manager
for CUNA Mutual Group
in WI
Retirement Project Manager
for Hewitt Associates
in IL
Benefits Systems Analyst
for Hewitt Associates
in IL
Health Benefits Project Manager
for Hewitt Associates
in IL
401(k) Administrator
for Rockford Pensions, LLC
in
Account Manager- H&W
for Charles W. Cammack Associates, Inc.
in NJ, NY
Pension Administrator - Defined Benefit
for American Express Tax & Business Services
in AZ
Business Development Manager
for Transamerica
in CA
EMPLOYEE BENEFITS ANALYST - 2 to 5 Years Experience
for Employee Benefits Brokerage Firm
in CA
ERISA Attorney
for Employee Benefits Institute of America Inc. (EBIA)
in WA
Benefits Marketing/Sales Support Specialist
for The Melita Group
in CA
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