June 28, 2006
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Vying Pension Accounting Methods Stir Concern
Excerpt: "U.S. accounting rule makers are set to reopen deliberations next month on a plan to bring pension and other retiree-benefit costs onto corporate balance sheets by the end of the year. But the biggest dilemma the standard setters may face is how to measure those costs. Their current measurement proposal, while supported by investors, has come under attack from companies and actuaries." (Reuters)
Opinion: 401k Plans -- Is the Story Under-told or Over-sold?
Excerpt: "A speech entitled 'The Under-told 401k Story' was delivered on May 2, 2006 at the annual conference of the Society of American Business Editors and Writers in Minneapolis-St. Paul, Minnesota by Vanguard Chairman and CEO John J. Brennan, in which he both examined various ostensible myths regarding traditional retirement income plans and explained why a well-managed 401k plan will effectively meet employees' retirement needs." (Brooks Hamilton via 401khelpcenter.com)
Defined Benefit Plan Terminations Increase
Excerpt: "The number of the nation's largest employers that are terminating or freezing pension plans has increased substantially since 2004, according to a recent analysis of Fortune 1000 companies by Arlington, Va.-based Watson Wyatt Worldwide." (Business Insurance)
Opinion: Why I Sued the County of San Diego
Excerpt: "One of the most obvious flaws in the calculation of both the city's and the county's annual payment to their retirement systems is the use of negative amortization. That's the practice of making payments that don't even pay all of the interest on the debt, never mind making a principal payment." (voiceofsandiego.org)
PBGC Peril Grows with Corporate Bankruptcies
Excerpt: "In just four years, the number of monthly checks PBGC sends to retired workers has swelled from 344,770 to 683,000, doubling annual payouts from $1.54 billion to $3.69 billion and turning the PBGC's budget from a tidy $10 billion surplus in 2000 into a $23 billion deficit last year." (MarketWatch)
Overview: IRS' Revised Final Rules on Disclosure of Relative Values (PDF)
5 pages. Excerpt: "These rules apply to defined benefit plans (including cash balance plans), money purchase pension plans (including target benefit plans), and other defined contribution plans that are subject to the spousal consent rules. Governmental plans and plans sponsored by churches that do not elect to be covered under ERISA ('non-electing church plans') are not subject to these rules." (Prudential Retirement)
Overview: Working Owner Entitled to Benefits Under Multiemployer Plan
Excerpt: "A lump-sum contribution to multiemployer plan on behalf of a working owner did not violate the exclusive benefit provision of ERISA, according to an opinion letter released by the Employee Benefits Security Administration (EBSA)." (CCH Pension & Benefits)
NY Governor Pataki Is Facing a Decision on Pension Increases for Public Sector Employees
Excerpt: "Dozens of bills making retirement benefits more generous for a wide range of public employees are awaiting Governor Pataki's signature or veto." (The New York Sun)
Opinion: The ERISA Fiduciary Tapestry -- Torn and Tangled?
Excerpt: "[The ERISA] tapestry was woven out of two select threads spun by Congressional artists in order to portray their vision for a safe and just employee benefits system. These two materials -- fiduciary management and equity jurisprudence -- when woven together created the fundamental structure of the ERISA fiduciary tapestry." (Herbert A. Whitehouse via 401khelpcenter.com)
Working Paper: Savings, Portfolio Choice, and Retirement Expectations (PDF)
24 pages. Excerpt: "Studying household investment behavior is essential for understanding the full consequences of old age social security benefits. Using data from six waves of the Health and Retirement Study, [the authors] analyze the dynamics of portfolio composition before respondents start claiming social security benefits. [The authors] consider ownership as well as amounts held of several types of assets and debts." (Michigan Retirement Research Center)
U.K. Firms' Pensions Inflate Prices, Hamper M&A, According to Aon Consulting Report
Excerpt: "New British pension regulations could hamper company takeovers and disposals, while the soaring cost of financing retirement is adding to inflationary pressure, an Aon Consulting report said [yesterday]." (Reuters via Business Insurance)
Newly Posted Press Releases
Employers Anticipate Further Restrictions on Retiree Medical Plans, Watson Wyatt Survey Finds
Hewitt Report Highlights Employee Use of Roth 401(k) Plans
(Hewitt Associates LLC)
More Employers Offer Consumer-Driven Health Plans to Employees, Says Aon Consulting and the International Society of Certified Employee Benefit Specialists
Newly Posted or Renewed Job Openings
Implementation Consultant X1
for Hewitt Associates
Open Enrollment Specialist
for BeneTemps, Inc.
in ANY STATE
Benefit Financial Analysis Manager
for CUNA Mutual Group
for Fred S. Shapiro & Associates, Inc.
Human Resources Manager
for CUNA Mutual Group
401 (k) Administrator
for Scholz, Klein & Friends Enlightened Retirement Group, Inc.
Benefits & Retirement Specialist
for Aerojet - Sacramento
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