| BenefitsLink Retirement Plans Newsletter |   |
August 25, 2005
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Teachers Have Few Safeguards When Investing in 403(b)s, which Attract Little Attention in Washington
Excerpt: "[403(b) retirement plans] provide investors far fewer protections than 401(k) plans, their better-known cousins offered by corporations. Weakly regulated and frequently saddled with high fees, the 403(b) market is now the scene of numerous fights over alleged wrongdoing by the plans' private vendors." (The Wall Street Journal via Pittsburgh Post-Gazette)
Associate Professor Suing to Fix What She Believes Is Corrupt System to Fund Local Police Pensions
Excerpt: "[P]eople in most Florida cities ... pay a tax on insurance premiums. It amounts to 85 cents on every $100. And the money represents the state's only contribution to local police pension funds. As police officers write more tickets, individual car insurance premiums rise, which increases the tax dollars that flow into police pensions. Once pension needs are met, cities have discretion over how to spend extra money, as long as it goes toward police benefits." (St. Petersburg Times)
Canadian Pensions Also Face Trouble with Plan Funding
Excerpt: "A report by the Association of Canadian Pension Management (ACPM) says that fewer Canadians will be covered by defined benefit pension plans and many plans will be underfunded unless existing legislation is changed. According to a Canadian news report, the ACPM report calls for governments to review current funding rules for pension plans and remove barriers to plan funding, such as preventing companies from accessing excess funds to make up shortfalls." (PLANSPONSOR.com: one-time registration required)
Expense and Funding Volatility Lead Firms to Ax Pension Plans
Excerpt: "Seventy three percent of large employers with a defined-benefit pension plan say their number one concern with maintaining it is expense and funding volatility. This finding of PricewaterhouseCoopers' Management Barometer, along with recent pension reform, is causing employers to consider freezing their pension plans." (PLANSPONSOR.com: one-time registration required)
Does Your 401(k) Plan Account Work Like a Traditional Pension Plan?
Excerpt: "They are not the headlines workers want to see splashed across the business section of their newspaper: 'traditional employer-funded pension plans outperformed worker-funded 401(k) plans during the 2000-2002 bear market.'" (Inside Indiana Business)
Does Your 401(k) Plan Offer Non-Hardship Withdrawals?
Excerpt: "If your 401(k) plan has a provision for 'in-service, non-hardship withdrawals,' you just might be in luck. Most 401(k) plans allow funds to be withdrawn only at the plan's stated retirement age or when the employee leaves the company." (The Journal & Topics Newspapers)
2005 Ariel/Schwab Black Investors Survey Reveals Effect of Employer-Sponsored Retirement Plans
Excerpt: "The growing use of employer-sponsored retirement plans is prompting more African Americans to invest in stocks, according to the 2005 Ariel/Schwab Black Investors Survey. In addition, 401(k) plans are helping black investors build wealth for the future and a solid nest egg for retirement." (blackenterprise.com)
Judge Certifies Williams Companies 401(k) Plan Company Stock Suit as Class Action
Excerpt: "An Oklahoma federal judge has certified as a class action a lawsuit filed by current and former K plan participants from Williams Cos. who allege a fiduciary breach over information given employees about their company stock investments." (PLANSPONSOR.com: one-time registration required)
Montana Legislative Council Is Launching a Study of State Employee Pension Funds
Excerpt: "What it comes down to is this: Any system that promises precise financial benefits 30 years later is doomed to eventual failure. There are too many unpredictable variables over time affecting the economy and growth of assets set aside and invested to pay for future benefits. There's also too much temptation to over-promise and under-fund pensions due to the promise-now-pay-later nature of the system." (The Montana Standard)
Overview: U.S. Treasury Announces Intent to Reissue 30-Year Treasury Bonds
Excerpt: "On August 3, 2005, the U.S. Department of Treasury announced its intention to begin issuing 30-year Treasury bonds again. The first new bonds will be issued in February 2006. This announcement should result in some good news for plan sponsors who need to select a FAS discount rate, as the news should help 'prop up' longer term interest rates." (Hewitt Associates)
RRC Conference Presentation: When the Nest Egg Cracks -- Managing Risks in Retirement (PDF)
24 pages. Excerpt: "[The Authors] Examine the Different Types of Negative Events that Strike at Older Ages: Compute prevalence of medical conditions, disability, parental frailty; Compute incidence of new medical conditions, disability, parental frailty, widowhood, divorce-- over about 10 years; Examine their impact on wealth and the chances of falling into 'poverty'" (Center for Retirement Research at Boston College)
Overview: Multinationals Eyeing Pension Plans in the War for Talent in China
Excerpt: "In a recent interview with the Financial Times, Bob Charles, head of retirement benefits consulting for Watson Wyatt in the Asia Pacific region commented on the role foreign multinationals will have in driving reform of occupational pensions in China, as they seek to win the war for the available talent. " (Watson Wyatt Worldwide)
Text of Comments on Proposed Section 415 Regulations by Piper Pension & Profit Sharing (PDF)
16 pages. Excerpt: "[T]here are fatal flaws in the proposed regulations which undermine the stated purpose of updating the regulations for accumulated changes due to changes in the law and resolution of ambiguities. Two proposed provisions reverse the positions taken by existing final regulations without a change in law and changes to historical Service positions regarding the effect of prior distributions violate both actuarial standards and the law." (Piper Pension & Profit Sharing)
Working Paper: Changing Risks Confronting Pension Participants (PDF)
28 pages. Excerpt: "This chapter examines ... challenges to participant retirement income security and identifies several legal and policy changes that might enable participants to cope better with such changes." (Pension Research Council)
RRC Conference Paper: Household Propensities to Plan for Retirement -- A Life Cycle Analysis (PDF)
20 pages. Excerpt: "In this paper, [the author] directly examine[s] the relationship between households' pre-retirement wealth and their consumption behavior while young." (Center for Retirement Research at Boston College)
RRC Conference Paper: Financial Literacy and Planning -- Implications for Retirement Well-being (PDF)
19 pages. Excerpt: "Why do people do so poorly when it comes to designing and carrying out retirement saving plans? This paper explores the hypothesis that poor planning may be a primary result of financial illiteracy. That is, we evaluate whether those who report that they are unable to plan for retirement or carry out their retirement saving plans are also those most unaware of fundamental economic concepts driving economic well-being during the lifetime and in old age." (Center for Retirement Research at Boston College)
Links to Items on Executive Comp, Benefits in General
Response to FASB Staff Advice on 'Date of Grant' for Equity Awards under FAS 123(R) (PDF)
2 pages. Excerpt: "'The FASB's staff has recently caused considerable turmoil in the compensation community. This is the result of the staff's advice to one or more of the big four accounting firms that grant date for financial measurement purposes under FAS 123(R) does not occur until the terms of the grant have been communicated to the employee. The ProblemIn most cases, communication to the employee takes several days after the board's compensation committee has approved the grant." (Frederic W. Cook & Co.)
National Compensation Survey: Employee Benefits in Private Industry in the United States, March 2005 (PDF)
32 pages. This summary presents NCS benefits data on access to employee benefit programs and participation in those programs for: Worker characteristics; Establishment characteristics; and Geographic areas. (U.S. Bureau of Labor Statistics)
Massachusetts State Employees to Keep Salary, Pension, Health Benefits If Called Up for Active Duty
Excerpt: "State employees will not lose their salary, pension and health benefits if they are called up for active duty in the military under legislation approved by the House and Senate last week.The plan mirrors an existing law that was set to expire on Sept. 11 of this year." (HarvardHillside.com)
Newly Posted Press Releases
Survey: Collection of Employer Contributions New Data Finds 90% of Funds Turn to Courts in Delinquencies
(International Foundation of Employee Benefit Plans)
Newly Posted or Renewed Job Openings
401(k) Client Relationship Manager
for The Douglas Group
in CA, CO, NJ, NY, PA
Leader of Benefits Outsourcing Operations
for Client of Jan Hufnell, Certified Personnel Consultant, Hufnell, Inc Benefit Recruiters
in PA
Supervisor
for Benefit Consultants Group
in NJ
Pension Administrator
for Benetech, Inc.
in AZ, DC
Trust Operations Specialist
for New York Life Investment Management LLC
in MA
Defined Contribution Client Account Manager
for New York Life Investment Management LLC
in NJ
Defined Benefit Client Account Manager
for New York Life Investment Management LLC
in MA
Defined Benefit Conversion Specialist
for New York Life Investment Management LLC
in MA
Defined Contribution Plan Administrator
for New York Life Investment Management LLC
in NJ
Senior Retirement Plan Specialist
for New York Life Investment Management LLC
in MA
Government Reporting Specialist
for New York Life Investment Management LLC
in MA
Manager - Employee Benefits
for A Retirement Plan Administration And Consulting Firm
in MN
Administrator - 401(k) Plans
for A Retirement Plan Administration And Consulting Firm
in MN
Legal Assistant - Employee Benefits
for A Retirement Plan Administration And Consulting Firm
in MN
Benefit Analyst
for Ameriprise Financial
in MN
Benefit Specialist
for Ameriprise Financial
in MN
Dir-Retirement Plans
for Ameriprise Financial
in MN
Benefits Specialist (Contract, Contract-to-Perm, or Direct Hire)
for The Rosen Group
in PA
Benefits Manager
for The Rosen Group
in PA
In house Counsel
for HWR Legal Search
in DC, VA
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