| BenefitsLink Retirement Plans Newsletter |   |
October 25, 2005
Today's sponsor: DATAIR Employee Benefit Systems, Inc.
(Click on company name or banner to learn more.)
| Software for DC/401(k) Plan Administration |
| DATAIR's IMPROVED BENEFIT ADMINISTRATION SOFTWARE for 401(k), Profit Sharing and all other Defined Contribution plans. Designed for administrators and consultants.
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| (Please visit our sponsors. We try to make sure their products and services will be of interest to you. Thanks! --Editor) |
Enhancing Retirement Savings Outcomes in Employer Sponsored Savings Plans through Participation (PDF)
15 pages. Excerpt: "A more general approach to increasing savings plan participation is to simplify the decision-making that is required. There are different ways to do this, such as offering a managed investment option, decreasing the number of investments in the fund menu, or offering employees a pre-selected menu of asset allocation options to choose from." (TIAA-CREF Institute)
Working Paper: Turning Workers into Savers? Incentives, Liquidity, and Choice in 401(k) Plan Design (PDF)
41 pages. Excerpt: "[The authors] develop a comprehensive model of 401(k) pension design that reflects the complex tax, savings, liquidity and investment incentives of such plans. Using a new dataset on some 500 plans covering over more than 740,000 workers, [the authors] show that employer matching contributions have only a modest impact on eliciting additional retirement saving." (Pension Research Council)
Employees Need 401(k) Advice Now
Excerpt: "Although both houses of Congress are close to passing bills that would provide for advice, the bills will be difficult to reconcile. The House bill would allow the firms that service the 401(k) plans for employers, such as mutual fund companies and brokerage firms, to provide the advice as part of their services. The Senate bill would require the advice be provided by independent third-party advisers, because of concerns the mutual fund companies and brokers would steer employees ...." (Investment News; registration or subscription required)
Overview: 2006 Cost-of-Living Increases in Dollar Limits and Thresholds for Retirement Plans
This is a brief list of the increases most relevant for 401(k) plans. (Employee Benefits Institute of America Inc.)
Overview: Certain Underfunded Plans Must Give Participants Funding Notice (PDF)
4 pages. Excerpt: "The Pension Benefit Guaranty Corporation's (PBGC) underfunded plan notification rule applies to employers with qualified defined benefit plans that are required to pay a PBGC variable rate premium, unless they are eligible for certain exceptions. The rule does not apply to governmental plans, nonelecting church plans, and multiemployer plans." (Prudential Retirement)
Overview: Katrina Tax Relief Legislation Provides New Incentives for Charitable Giving by Individuals (PDF)
3 pages. This newsletter discusses the possibility of donating retirement account funds. (Pillsbury Winthrop Shaw Pittman LLP)
Preretirement Distributions: Can You Take Them with You?
Excerpt: "[This] article looks at what ... employees can do regarding their retirement benefits after they have switched employers." (U.S. Bureau of Labor Statistics)
District Judge Upholds Disability Retirement Benefit Formula
Excerpt: "A Kentucky federal judge has cleared a pension plan administrator of wrongdoing in reducing disability retirement benefits based on participants' early retirement though it hadn't used that plan provision for 15 years. US District Judge Jennifer Coffman of the US District Court for the Western District of Kentucky ruled that the administrator of the Southern Graphic Systems Inc. Pension Plan properly relied on the plan documents which she said were unambiguous ...." (PLANSPONSOR.com: one-time registration required)
United Kingdom Government Changes Life Expectancy Formula
Excerpt: "UK government officials have announced that they will no longer factor in the notion that there has to be a ceiling when It comes to greater longevity-- sometimes referred to as the 'limit to life' hypothesis. The change, which has produced another upward tweak in the government's life expectancy estimates, is good news for workers but not very welcome for pension programs where more money will be needed to plug any funding holes, the Financial Times reported." (PLANSPONSOR.com: one-time registration required)
Special Considerations in Designing and Operating an ESOP (PDF)
28 pages. Excerpt: "ESOPs are attractive to employers for many reasons, but they have special characteristics and requirements that distinguish them from other defined contribution plans with which most employers and their advisors may be familiar. The purpose of this article is to provide an overview of some of the unique features of ESOPs that employers should consider as they design and operate their ESOPs." (ERISA Compliance & Enforcement Strategy Guide via Carton & Douglas LLP)
Japanese Financial Institutions & Pension Funds Will Increase Allocations to Alternative Investments
Excerpt: "A sizable proportion of Japanese institutional investors are planning to reduce their allocations to equities, both domestic and international, while those that are planning to significantly alter their levels of domestic fixed-income exposure are about evenly split between those planning increases and those planning reductions, according to a Greenwich Associates press release." (PLANSPONSOR.com: one-time registration required)
Issue Brief: A Guide to the Use of Stochastic Models in Analyzing Social Security (PDF)
12 pages. Excerpt: "This guide provides an overview of what deterministic modeling, sensitivity analysis, and stochastic modeling mean, and how these methods are applied to the problem of evaluating the financial status of Social Security. It also discusses some of the benefits of sensitivity analysis and stochastic modeling, as well as some of their limitations." (American Academy of Actuaries)
Links to Items on Executive Comp, Benefits in General
ERISA Standards of Review and the Administrator's Conflict of Interest (PDF)
Pages 20-23 of 64. Excerpt: "The Tenth Circuit Court of Appeals recently provided helpful guidance for district courts evaluating claims of wrongful denial of employee benefits under ERISA. In particular, the court clarified the standard of review to be applied where the plan administrator of the employee benefit plan had a potential conflict of interest at the time the benefits were denied." (Utah Bar Journal)
A Continued Discussion of Section 409A Regulations
Excerpt: "There are six permitted section 409A distribution events ...: Separation from service (a 'specified employee' of a public company may not receive distributions until at least six months after separation); A fixed time, or pursuant to a fixed schedule, specified under the plan; Death; Disability; Change in control of a corporation (change in control of a partnership is subject to analogous rules); and, Unforeseeable emergency." (Deloitte's Washington Bulletin via BenefitsLink.com)
Overview: Deferred Compensation Proposed Regulation under Internal Revenue Code §409A
Excerpt: "The American Jobs Creation Act of 2004 substantially overhauled many of the rules governing deferred compensation arrangements by establishing §409A of the Internal Revenue Code ('§409A'). In addition to regulating more traditional deferred compensation plans, the new rules cover many arrangements that were not previously thought of as deferred compensation (e.g., severance arrangements, discounted stock options and stock appreciation rights)." (Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C.)
Proposed Section 409A Regulation: What is Nonqualified Deferred Compensation under Section 409A? (PDF)
10 pages. Excerpt: "This Alert focuses on the provisions of the ProposedRegulations that relate to the definition of 'nonqualified deferred compensation plan' and the determination of which arrangements are subject to Section 409A." (Kirkpatrick & Lockhart Nicholson Graham LLP)
Newly Posted Events
Code Section 409A Workshop
in Massachusetts on November 30, 2005
presented by SunGard Corbel
Code Section 409A Workshop
in Washington on November 30, 2005
presented by SunGard Corbel
Code Section 409A Workshop
in New York on December 1, 2005
presented by SunGard Corbel
Code Section 409A Workshop
in California on December 1, 2005
presented by SunGard Corbel
Legislative Overview and Update
in District of Columbia on November 3, 2005
presented by Capital Chapter ISCEBS
Ready for Roth?
in Georgia on December 6, 2005
presented by SunGard Corbel
Retirement Plans: What Every Employer Must Know
in Minnesota on November 30, 2005
presented by SunGard Corbel
Retirement Plans: What Every Employer Must Know
in Texas on December 1, 2005
presented by SunGard Corbel
Women Alone: Managing the Risks of Retirement
in District of Columbia on October 27, 2005
presented by Women's Institute for a Secure Retirement (WISER)
Newly Posted Press Releases
IRS Seeks Applications for TE/GE Advisory Committee
(Internal Revenue Service (IRS))
Saving in America: Three Key Sets of Figures
(Employee Benefit Research Institute (EBRI))
Council Urges Focus On Shared Pension Funding Goals, Questions Assumptions Used By PBGC And CBO
(American Benefits Council)
Survey Shows Nearly All Employers Make an Effort to Accommodate Seriously Ill Employees
(International Foundation of Employee Benefit Plans)
Pittsburgh Business Group on Health Tackles Diabetes Care
(Pittsburgh Business Group on Health)
Newly Posted or Renewed Job Openings
401(k) Client Relationship Manager
for The Douglas Group
in CA, CO, NJ, NY, PA
Pension Administrator
for R.J.L. Pension Services, Inc.
in FL
Life & Health Sales Representative
for Great-West Healthcare
in MI, OH
Benefits Consultant
for Carilion Health System
in VA
Compliance Testing Consultant
for Diversified Investment Advisors
in NY
Defined Contribution Administrative Assistant
for BFP Associates
in MA
Senior Plan Administrator
for The Allocation Company, Inc.
in TX
Retirement Services District Manager
for ADP Retirement Services - Automatic Data Processing
in AZ, CA, CT, FL, IN, MI, NC, NJ, NV, NY, SC, TN, TX
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.
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