Retirement Plans
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May 17, 2006
Today's sponsor: InvestLink

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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)

Pension Deficit, Now $500 Billion, May Clobber Corporate Bonds
Excerpt: "The $500 billion deficit in U.S. company retirement plans is about to bite corporate bond investors. .... Congress is debating a new law that would force them to start plugging the gaps in their pension plans. The rules may require companies to use cash or borrow to meet obligations to millions of pensioners." (Bloomberg News)

Who Wants to Be a Fiduciary Anyhow?
Excerpt: "Perhaps the supply-demand dilemma for qualified fiduciaries accounts for what can only be described as a heightened interest in the notion of hiring an independent fiduciary." (Pension Risk Matters)

A Bad Marriage? Variable Annuities and 401(k) Plans
Excerpt: "There is a raging debate about using variable annuities in 401(k) plans. To the insurance industry, it's a great idea; to critics, it's an outright scam." (Workforce Management; one-time registration required)

Overview: Treasury Regulations for Roth Contributions to 401(k) and 403(b) Plans (PDF)
5 pages. Excerpt: "The final and proposed regulations impose considerable new responsibilities on plan sponsors that introduce designated Roth contributions to a 401(k) or 403(b) plan. The reporting and recordkeeping requirements under the proposed regulations, in particular, bring a new level of detail to the tracking and communication of elective contributions." (Morgan, Lewis & Bockius LLP)

ETFs Cross 401(k) Barrier
Excerpt: "The low costs and transparency of ETFs have made them popular among individual and institutional investors alike. Nevertheless, because ETFs trade like stocks, excessive trading costs have played a part in keeping ETFs out of the vast 401(k) market. Record keeping issues also have raised problems, since ETFs, like stocks, settle in three days, while traditional mutual funds offer a net asset value at the end of each day." (

Rising Interest Rates, Stocks -- Perfect Weather for Pension Plans
Excerpt: "New study by pension expert shows companies moving to 100 percent pension funding." (Workforce Management; one-time registration required)

Ruling: Tax Exempt Status of Early Distributions from Def. Retirement Option Plans Due to Katrina (PDF)
State Revenue Ruling, No. 06-005, May 10, 2006, Individual Income Tax. Implications of Acts 50 and 61 of the 2005 1st Extraordinary Session on the Tax Exempt Status of Early Distributions from Deferred Retirement Option Plans Due to Hurricane Katrina (Department of Revenue, State of Louisiana)

Pension Sponsors Back Socially Responsible Investing
Excerpt: "Under the guidance of the United Nations, 20 of largest pension plan fiduciaries in 12 countries recently forged six basic principles ( for socially responsible investing (SRI)." (BenefitNews Connect)

Working Paper: Social Security Replacement Rates for Alternative Earnings Benchmarks (PDF)
Excerpt: "Social Security reform proposals are often presented in terms of their differential impacts on hypothetical or 'example' workers. [This paper] explores how different benchmarks produce different replacement rate outcomes [using] the Health and Retirement Study (HRS) to evaluate how Social Security benefit replacement rates differ for actual versus hypothetical earner profiles, and [examining] whether these findings are sensitive to alternative definitions of replacement rates." (University of Michigan Retirement Research Center)

Confirming the CalPERS Effect: Academic Study Links Shareowner Activism to Financial Gain
Excerpt: "Examining companies targeted for governance reform by the CalPERS Focus List, the study presents data correlating activism to increasing shareowner value as well as cautionary notes." (

Links to Items on Executive Comp, Benefits in General

House Accepts Motion to Restrict Executive Pension Increases When Plans Are Underfunded
Excerpt: "The House has approved a motion, offered by Rep. George Miller (D-CA), designed to extend to corporate executives the same restrictions on benefit increases from underfunded plans that would apply to rank-and-file employees. The motion was passed by the House on May 3, 2006, by a 299 to 125 vote." (CCH Pension & Benefits)

Tenth Circuit Withdraws Decision Requiring Disclosure of Selection Criteria Under OWBPA (PDF)
1 page. Excerpt: "On May 2, 2006, the Tenth Circuit withdrew its 2005 decision and issued a new one. The new decision still holds that Weyerhaeuser violated the OWBPA, and thus failed to obtain valid ADEA waivers, because it provided job titles and ages for the wrong 'decisional unit.' However, because the court withdrew its earlier decision, no federal appellate authority requires disclosure of RIF selection criteria." (Seyfarth Shaw LLP)

Small Firm Employees Getting More Big Company Benefits Services, According to Survey
Excerpt: "More than ever before, employees at smaller companies have access to benefits tools and services that previously had been seen only in larger firms, a new survey found." ( one-time registration required)

Court Rules Benefits Plan Can Recover Overpayments
Excerpt: "An error that results in a overpayment of benefits to a plan participant does not prevent the plan sponsor from recovering the amount overpaid, the US District Court for the Eastern District of Pennsylvania said, rejecting a widow's claim that she did not have to pay back $60,000 because the payment was not her fault." ( one-time registration required)

Newly Posted Events
(Post Yours!)

Code Section 409A Workshop
in Kansas on June 14, 2006
presented by SunGard Corbel

Code Section 409A Workshop
in North Carolina on June 15, 2006
presented by SunGard Corbel

Code Section 409A Workshop
in Georgia on June 16, 2006
presented by SunGard Corbel

Code Section 409A Workshop
in Texas on June 21, 2006
presented by SunGard Corbel

Estate Planning Considerations for Qualified Plans and IRAs
in Texas on June 22, 2006
presented by SunGard Corbel

Estate Planning Considerations for Qualified Plans and IRAs
in Arizona on June 23, 2006
presented by SunGard Corbel

New! Fundamentals of 401(k) and Other Qualified Plans
in Georgia on June 21, 2006
presented by SunGard Corbel

New! Fundamentals of 401(k) and Other Qualified Plans
in North Carolina on July 12, 2006
presented by SunGard Corbel

New! Fundamentals of 401(k) and Other Qualified Plans
in Minnesota on July 12, 2006
presented by SunGard Corbel

Newly Posted Press Releases
(Post Yours!)

Reforms to U.S. Pension Funding and Accounting Rules: Their Potential Effect on Equity Values and Interest Rates
(U.S. Department of Treasury)

Most Workers Content with Compensation Package, Yet Many Yearn for Flexible Schedules

CPI Qualified Plan Consultants Adds Gartmore Funds to Retirement Platform
(CPI Qualified Plan Consultants, Inc.)

Newly Posted or Renewed Job Openings
Post a Help Wanted Ad

Senior Plan Administrator
in CA

Call Center Representative
for The Newport Group, Inc. (Charlotte, NC location)
in NC

Defined Contribution Retirement Plan Administrator
for Loren D. Stark Company, Inc.
in TX

Manager, Pension Products Operations
in CO, NC

Enrolled Actuary P/T or F/T
for Forest Hills Pension Services
in NY

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