| BenefitsLink Retirement Plans Newsletter |   |
May 4, 2005
Today's sponsor: Penchecks, Inc.
(Click on company name or banner to learn more.)
| Penchecks, Inc. Announces the National Registry of Unclaimed Retirement Benefits! |
| Coming in May 2005, the National Registry is a web-based service
designed to reunite plan participants with their unclaimed retirement benefits. Plan Administrators and IRA custodians may register their missing participants in the National Registry’s database. Participants will be able to check the database online. If a record is found, contact information is provided. There is no charge to individual participants to use the service.
All Penchecks, Inc. missing participants IRAs are automatically included in the National Registry Database. PenChecks, Inc. is the industry leader in Benefit Distributions, Missing Participant, and Automatic/Default Rollover IRA Programs. For more information click above or call 800-541-3938. |
| (Please visit our sponsors. We try to make sure their products and services will be of interest to you. Thanks! --Editor) |
Why a Wealth of Choices in 401(k)s May Not Be a Good Idea
Excerpt: "Memo to 401(k) providers: If you want employees to choose intelligently, don't give them too much choice." (The Wall Street Journal via Pittsburgh Post-Gazette)
Overview: IRS Proposed Regulations on Designated Roth Contributions to 401(k) Plans
Excerpt: "The IRS has issued proposed amendments to the 401(k) and (m) regulations that would provide guidance on designated Roth contributions under Internal Revenue Code section 402A, added by EGTRRA. Beginning in 2006, a 401(k) plan may permit employees to designate some or all of their elective contributions as Roth contributions." (Watson Wyatt Worldwide)
How Do Retirement Plans Affect Employee Behavior?
Excerpt: "Recent trends in U.S. private pensions are undeniable. Over the last 25 years, defined benefit plans -- once the centerpiece of the retirement portfolio -- have lost considerable ground to defined contribution plans, which have become the primary vehicle for saving for retirement. Some analysts claim that traditional defined benefit plans are a dying breed (if not already dead)." (Watson Wyatt Worldwide)
Snow Defends Pension Benefit Limits for Underfunded Pension Plans
Excerpt: "Employers in financial difficulty with underfunded pension plans should not be allowed to boost benefits, Treasury Secretary John Snow said Tuesday. Speaking before the annual meeting of the American Academy of Actuaries, Mr. Snow said such benefit commitments by companies with a high risk of failure often end up being picked up the Pension Benefit Guaranty Corp." (Business Insurance)
Saving Private Pension Insurance: An Evaluation of Current Proposals to Shore Up the PBGC (PDF)
17 pages. Excerpt: "The Bush Administration has proposed a complete overhaul of pension funding regulations as part of its 2006 budget proposal. Watson Wyatt has analyzed the impact of the proposed reforms and the analysis suggests that the proposal will increase the degree to which healthy firms are subsidizing weaker ones rather than moving toward a risk-based system." (Watson Wyatt Worldwide)
Pension Reform under Active Discussion in Washington
Excerpt: "Congress has started public discussions about the administration's pension reform proposal. The Senate Finance Committee, House Education and the Workforce Committee, and House Ways and Means Select Revenue Measures Subcommittee held hearings in March. In addition, the Senate Health, Education, Labor and Pensions (HELP) and Finance Committees conducted a joint forum to discuss the future of the private pension system." (Watson Wyatt Worldwide)
House & Senate Agree to $6.6 Billion Budget Savings from PBGC; Substantial Premium Increase Likely
Excerpt: "[The week of April 29, 2005], the House and Senate passed a $2.6 trillion budget deal requiring reforms of the Pension Benefit Guaranty Corporation reform to generate $6.6 billion in savings over five years. Although this amount is much more reasonable than the $18 billion assumed in the original House version, it will still require substantial increases in the PBGC premium structure and likely encourage employers to exit the defined benefit system." (HR Policy Association)
Overview: New Filing Requirements for U.S. Residents with Canadian Retirement Plans
Excerpt: "Under the U.S.-Can.ada Tax Treaty, U.S. taxpayers with a Canadian Registered Retirement Savings Plan or Registered Retirement Income Fund can make an election to avoid paying taxes on plan earnings until they start receiving benefits from the plan. Typically, a U.S. taxpayer who has an RRSP or RRIF is a U.S. resident who previously lived and worked in Can.ada." (Watson Wyatt Worldwide)
Proposed Phased Retirement Brings New Administrative Concerns for Companies
Excerpt: "One observer does not believe that employers of salaried employees would be willing to implement systems to track their hours under the phased retirement proposal. Employers may have thought that the proposed regulation on phased retirement would put to rest their concerns about retaining older workers, but they could be in for a new round of headaches." (Workforce Management; one-time registration required)
Protect Your Nest Egg: Accessing Your 401(k) Account
Excerpt: "Millions of working Americans rely on 401(k) plans for their retirement, but thousands of people each year try to withdraw their money and can't, according to WBAL-TV in Baltimore." (NBC17.com)
Book Review: The 27 Prudent Investment Practices for Financial Advisers, Trustees, and Plan Sponsors
Excerpt: "[The New Fiduciary Standard: The 27 Prudent Investment Practices for Financial Advisers, Trustees, and Plan Sponsors] explains the process to be followed by investment professionals who wish to adhere to a uniform fiduciary standard of care for their clients. Its tenets are based on Prudent Investment Practices: A Handbook for Investment Fiduciaries, by the Foundation for Fiduciary Studies." (Financial-Planning)
Intelligent Design: Voluntary Personal Accounts and the Federal Employees' Thrift Savings Plan (PDF)
7 pages. Excerpt: "Architects of President Bush's plan for personal retirement accounts may want to model their approach to Social Security reform after the federal employees' Thrift Savings Plan." (Contingencies via American Academy of Actuaries)
Retirement Doomsday As Seen by Ben Stein
Excerpt: "According to Ben Stein, the fault lies not with Social Security but with ourselves. Stein is on a crusade to warn Americans about the coming retirement crisis. It has less to do with Social Security or its reform, and more to do with the dramatic decline in U.S. savings and the absence of individual retirement planning." (Forbes.com)
Fixing Social Security: The Choices Aren't Hard Nor the Measures Painful (PDF)
7 pages. Excerpt: "[A] comprehensive new plan (PDF) for resolving Social Security's projected financial shortfall demonstrates just how overstated the case for a Social Security 'crisis' really is. Developed by Robert M. Ball, a name synonymous with the Social Security program for nearly 50 years, the plan uses a simple combination of revenue increases and cost reductions to put Social Security on a firm financial footing for the next 75 years and beyond." (Robert M. Ball via The Century Foundation)
Opinion: Social Security Reform Using Voluntary Personal Accounts (PDF)
5 pages. Excerpt: "Two former Social Security chief actuaries debate the underlying principles behind partial privatization of Social Security program." (American Academy of Actuaries)
Opinion: Bush Social Security Reform Promotes Leveling of Benefits with Progressive Indexing Formula
Excerpt: "On April 28 President Bush, to his credit, bit the bullet and proposed cuts in future Social Security benefits that would significantly reduce the projected long-term deficit. His plan would cut into the inflation-adjusted benefits of high- and medium-wage workers, but shield low-paid retirees from reductions." (The Washington Times)
IRS Weighted Average Interest Rate Table Updated for May 2005
Weighted average for May 2005: 5.03% (U.S. Internal Revenue Service)
IRS Composite Corporate Bond Rate Table Updated for May 2005
Corporate Bond Weighted Average Interest Rate = 5.97 for May 2005 (U.S. Internal Revenue Service)
Sears Will Cease Defined Benefit Plan Accruals at End of 2005
Excerpt: "Benefits accruals in the $2.5 billion defined benefit plan for Sears Roebuck & Co. will be cut off as of January 1, 2006 with workers getting coverage under a revamped 401(k) plan. Partly prompting the accrual change, according to a Sears spokesman quoted by Business Insurance, was that offering a defined benefit plan has become 'an unacceptable risk' because of the volatility of the cash funding requirements." (PLANSPONSOR.com; one-time registration required)
Text: H.R. 1961, The Pension Preservation and Savings Expansion Act (PDF)
194 pages. A copy of the 2 page Summary of the Pension Preservation and Savings Expansion Act is at http://www.americanbenefitscouncil.org/documents/cardinsummary_042805.pdf. (American Benefits Council)
Text: H.R. 1960, The Individual and Workplace Retirement Savings Promotion Act of 2005 (PDF)
199 pages. Excerpt: "To amend the Internal Revenue Code of 1986 to expand pension coverage and savings opportunities and to provide other pension reforms. [A copy of the 2 page Summary of the Provisions of the Individual and Workplace Retirement Savings Promotion Act of 2005 is at http://www.americanbenefitscouncil.org/documents/pcsum0405.pdf]" (American Benefits Council)
Links to Items on Executive Comp, Benefits in General
The Trucker Huss April 2005 Benefits Report Includes Recent Developments in Washington (PDF)
6 pages. This issue of the newsletter reviews Bankrup.tcy Reform; Expansion of Department of Labor Correction Program; Stock Option Accounting Update; and, Revenue Procedure 2005–23 -- Internal Revenue Service Guidance for Implementing Heinz Decision. (Trucker Huss)
Failure to Decide Appeal within ERISA-Mandated Time Limit Allowed Participant to File Suit
Excerpt: "This case was decided under the old ERISA claims procedure rules. .... The current claims procedure rules impose a shorter deadline for deciding disability appeals (a reasonable period not to exceed 45 days, with one 45-day extension for special circumstances after notice is given to the claimant)." (Employee Benefits Institute of America Inc.)
Opinion: Medical, Pension Costs Hurt General Motors
Excerpt: "Who knew? Speculation about which welfare state will be the first to buckle under the strain of the pension and medical costs of aging populations usually focuses on European nations with declining birth rates and aging populations. Who knew the first to buckle would be General Motors, with Ford not far behind?" (George Will via The Joplin Globe)
Hewitt Federal Legislation Quick Guide Updated as of May 3, 2005
Excerpt: "Hewitt's Federal Legislation Quick Guide provides short updates on federal legislation that is currently under active consideration by Congress or has recently been enacted into law regarding health and welfare benefit plans, retirement plans, and human resources and employment law." (Hewitt Associates)
How to Get a Better Severance Package
Excerpt: "If you got a pink slip and you're over 40, you may have more leverage than you think to negotiate severance. Here are some pointers on how to haggle for a sweeter deal." (Fortune)
Newly Posted Press Releases
Make-A-Wish Foundation of America Joins with Gilsbar, Inc. to Control Health Plan Costs
(Gilsbar, Inc.)
MetLife Works with Millennium Trust to Launch Automatic Ira Rollover Program for Small- and Medium-Sized Firms; Results: Lowered Administration Costs and Time Savings for Plan Sponsors
(MetLife)
Beneficial Financial Group Selects Assist America for Global Emergency Services
(Assist America, Inc.)
Health Insurance: Can Californians Afford It?; Rising Health Insurance Costs Hit Chronically Ill and Low-Wage Workers Hardest
(California HealthCare Foundation (CHCF))
MyFinancialAdvice, Inc. to Provide Live Advice to Decimal’s “The Online 401(k)™ Solution”
(Decimal, Inc.)
Newly Posted or Renewed Job Openings
Business Analyst II - Retirement Plans
for Legg Mason Wood Walker, Inc.
in MD
Account Executive - Client Services
for Diversified Investment Advisors
in NY
Sr Account Executive
for AXA Financial
in NJ
Handy Links:
- View Today's Active Message Threads
- Search BenefitsLink
- Using the Web for Employee Benefits Research (hypertext article)
- Employee Benefits Library
Copyright 2005 BenefitsLink.com, Inc.; except that you may reprint this newsletter in full (including this sentence) without obtaining our permission.
Published by:
BenefitsLink.com, Inc.
https://benefitslink.com/about.html
1298 Minnesota Avenue, Suite H
Winter Park FL 32789
(407) 644-4146
Fax: (407) 644-2151
Editor and Publisher: David Rhett Baker, J.D.
Housekeeping: