Retirement Plans
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February 27, 2006
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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)

What to Do If Your 401(k) Plan Has Hit the Rocks
Excerpt: "If you work for a corporation, you know the drill. You are constantly being asked whether your work is meeting preset objectives. Why not require the same of your 401(k)? By bringing in independent consultants and creating an investment policy statement, you can not only give your 401(k) a set of targets, you can improve returns and cut costs." (Bloomberg News)

Opinion: The 'DB-ing' of DC Plans
Excerpt: "DC plans need structure, discipline, and personalization. Personalized account management that uses a DB structure to actuarially determine appropriate contributions and select managed accounts, while retaining DC flexibility, should be the answer." (The McHenry Group)

White Paper: Reinventing the Defined Contribution Plan -- Research, Analysis and Recommendations (PDF)
28 pages. Excerpt: "In this white paper, Prudential Retirement will demonstrate an industry-leading understanding of the [defined contribution retirement plan] situation, offer convincing research and analysis, and present a series of recommendations designed to increase the probability that DC plans will deliver secure retirement outcomes for tomorrow's generation of Americans." (Prudential Retirement)

Overview: Roth 401(k) Proposed Regulations
Excerpt: "[The target page presents] the basics of the proposed Roth distribution rules ...." (McDermott Will & Emery)

What Is the Contribution Limit for a 403(b) in 2006?
Excerpt: "For an individual in a 403(b) plan, the deferral limit has increased in 2006 to $15,000." (McKay Hochman Co., Inc.)

Wall Street Gives High Marks to Funds for New York State Workers and Teachers
Excerpt: "New York's public-employee pension systems has received a clean bill of health in a report from a Wall Street firm that warned other states owe far more to future retirees than they have set aside." (Star-Gazette)

Retirement Plans in Puerto Rico Required to be Funded with Puerto Rico Trusts
Excerpt: "[E]ffective September 22, 2004, with the adoption of Section 1165(a)(11) of the Puerto Rico Internal Revenue Code of 1994 ...., in order for a pension, profit sharing, or stock bonus plan to be qualified in P.R., the trust forming part of the plan must be created under the laws of P.R. and its trustee must be a P.R. resident." (BNA's Tax Management Inc.)

Switzerland: Update on Third Phase of Revision of BVG (PDF)
2 pages. Excerpt: "In the latest edition of Perspectives, Watson Wyatt's regular newsletter on issues and trends in Swiss pension provision, Victor Ackermann and Corinne Antonica examine the likely impact of the third phase of the revision of the Swiss occupational pensions law (BVG) which took effect on 1 January 2006." (Watson Wyatt Worldwide)

Blog: Economic Report of the President Characterizes Pension Investment Policies as 'Hazardous'
Excerpt: "[T]he Administration wants defined benefit pension plans to dump their stock portfolios - amounting to about $1 trillion for private pension plans, plus hundreds of billions more held by public pension plans - in favor of duration-matched fixed income portfolios." (Pensions & Benefits Weblog)

Fate of Investment Advice Legislative Provisions Hinges on House-Senate Negotiations
Excerpt: "The ability of insurance companies and their agents to easily provide investment advice to investors in defined contribution programs will be at stake as House and Senate negotiators begin their efforts this week to reconcile different versions of legislation whose main goal is ensuring the solvency of defined benefit plans." (National Underwriter Life & Health; free one-time registration or paid subscription required)

Disaster Relief Relating to PBGC Deadlines in Response to Hurricane Katrina in LA, MS, and FL
Excerpt: "This announcement was updated on February 24, 2006, to extend disaster relief until August 28, 2006, for the Louisiana parishes of Cameron, Jefferson, Orleans, Plaquemines, St. Bernard, St. Charles, and St. Tammany, and for the Mississippi counties of Hancock, Harrison, and Jackson." (U.S. Pension Benefit Guaranty Corporation)

The Nuts & Bolts of 401(k) Fees
Excerpt: "Most people now have an understanding that the 401(k) plan is not free, but what kind of fees are we talking about here?" (The McHenry Group)

Overview: FDIC Insurance Increase for Retirement Accounts
Excerpt: "The Deficit Reduction Act of 2005 increases the Federal Deposit Insurance Corporation's coverage on retirement accounts from $100,000 to $250,000, and contains provisions to permit coverage on other accounts to increase as well." (McDermott Will & Emery)

Results of Defined Contribution Plan Tentative Agreement Vote by United Airlines Flight Attendants
Excerpt: "Seventy-nine percent of Flight Attendants who cast ballots voted for the pension replacement plan." (Association of Flight Attendants-CWA)

Audio: Ken Dychtwald -- The Changing Face of Retirement
Excerpt: "David Gardner talks about the changing face of retirement with Ken Dychtwald, author of The Power Years: A User's Guide to the Rest of Your Life." (The Motley Fool via National Public Radio)

Links to Items on Executive Comp, Benefits in General

Options and the Deferred Tax Bite
Excerpt: "There's more to handling employee stock options than selecting a valuation method. FASB Statement no. 123(R) has tax accounting implications as well. This article explains how to handle them." (Journal of Accountancy)

Employee Compensation: Employer Spending on Benefits Has Grown Faster than Wages
Excerpt: "In this report, GAO examined federal data on private employers' costs for active workers and sought perspectives from 17 experts to identify (1) recent trends in employers' total compensation costs; (2) composition of the trends; (3) whether employees' costs, participation, or access to benefits changed; and (4) possible implications of the changes for private systems. [Highlights are at]" (U.S. Government Accountability Office)

LTC Plans Add Muscle to Executive Benefits
Excerpt: "Smaller firms are responding well to the message that LTC as an executive benefit protects key people's personal financial assets, provides permanent and portable coverage, and offers significant tax benefits to both the company and the executive." (National Underwriter Life & Health; free one-time registration or paid subscription required)

Blog: Benefits Growth Outpaces Compensation Growth .... Maybe
Excerpt: "The GAO attributes most of the increase in benefits costs to health insurance and retirement income, the cost of which comprise almost 60 percent of benefit packages. Paid leave, traditionally the most expensive benefit, yielded first place to health insurance during the study period. Escalation in health care costs was attributed to advances in medical technology, increased utilization of expensive procedures and services, and population aging." (Pensions & Benefits Weblog)

Additional sponsor: ASC & The ASC Institute

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ASC - Your Source for Retirement Plan Software, Documents & Education

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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)

Newly Posted Press Releases
(Post Yours!)

The SPARK Institute Releases Rule 22c-2 Data Standards And Frequent Trading Policy For Retirement Plan Intermediaries
(Society of Professional Administrators and Recordkeepers (SPARK))

AICPA Employee Benefit Plan Audit Quality Center Issues Tool to Help Plan Sponsors Select Their Plan Auditor
(American Institute of Certified Public Accountants (AICPA))

Newly Posted or Renewed Job Openings
Post a Help Wanted Ad

Pension Administrator
for Primark Benefits
in CA

401(k) Enroller/Contractor - Bilingual
for Transamerica

401(k) Enroller/Contractor
for Transamerica

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Editor and Publisher: David Rhett Baker, J.D.