Retirement Plans
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October 25, 2006
Today's sponsor: ASPPA • Working for America's Retirement™

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The 6th Annual ASPPA 401(k) SUMMIT

Be in San Diego February 25-27, 2007 at the Manchester Grand Hyatt to join ASPPA and a few thousand of your colleagues for the industry event of the year. We will have all new workshops that target small, mid and large plan markets, world class speakers, luncheon discussion groups for networking and Pension Protection Act 2006 perspectives from industry experts. don't miss out on early registration incentives. The ASPPA 401(k) SUMMIT – The Forum for Retirement Sales and Investment Professionals.

(Please visit our sponsors. We try to make sure their products and services will be of interest to you. Thanks! --Editor)

401(k) Fee Litigation: The Prudent Fiduciary Response (PDF)
Excerpt: "The recent publicity surrounding the 401(k) fee litigation is prompting some plan sponsors and fiduciaries to wonder whether they have acted prudently in managing 401(k) service providers. In this Alert, [Aon reviews] the relevant fiduciary responsibilities, common practices for charging fees in the marketplace, and best practices in monitoring service providers and their fees." (Aon Consulting)

Overview: DOL Advisory Opinion on Asset Allocation Strategies for Defined Benefit Pension Plans
Excerpt: "[C]an a plan fiduciary take into account the plan sponsor's interests when choosing and implementing an investment strategy without violating the basic ERISA fiduciary directive to act 'solely in the interest' of the plan's participants and beneficiaries? New Department of Labor Advisory Opinion 2006-08A (October 3, 2006) provides guidance on that issue." (Deloitte)

SOA Research Proposal: Reversion Taxes--Quantifying their Impact on Pension Plan Funding
Excerpt: "The SOA's Pension Section Research Team is seeking research proposals to quantify the impact of reversion taxes on pension funding. This is not intended to be a restatement of the current tax law or its general qualitative impact." (Society of Actuaries)

Current Pension Actuarial Practice in Light of Financial Economics Symposium
The papers are from a June 2003 symposium. You may download all chapters in one complete pdf file (2.5mb) or each chapter separately. (Society of Actuaries)

Most of Coke Company Stock Suit Dismissed
Excerpt: "A federal judge in Georgia has thrown out most allegations in a lawsuit that charged those running Coca-Cola's thrift and investment plan with breaching their fiduciary duties by not eliminating company stock as an investment option." (; one-time registration required)

Opinion: Providing Reliable Worker Pensions Is Crucial Element in Public Policy
Excerpt: "Patty Fisher's Oct. 18 column, 'Sweetening the pension pot is troubling,' claims that by offering California public employees competitive retirement and retiree health benefits, elected officials are offering 'cushy deals.' Nothing could be further from the truth." (The Mercury News)

Commentary: Oregon PERS Amendment Not Unconstitutional
Excerpt: "In Robertson v. Kulongoski (No. 04-35898), the 9th Circuit Court of Appeals today ruled that although the Oregon Public Employee Retirement System had been expressed in prior state litigation as 'a contract between the state and its employees,' there exists no clear indication that the Oregon legislature intended to promise its employees a perpetual, immutable right to contribute to specific accounts under the terms of its retirement system." (Pensions & Benefits Weblog)

Commentary: The Unpleasant Truth about Social Security
Excerpt: "Here are some facts that you will never hear about Social Security from anyone in government: Fact No. 1: Social Security is based upon a lie. It was sold to Congress as one thing - a government spending program - and as another thing to the populace - as an insurance plan, just like any in the private sector." (The Evening Bulletin)

Working Paper Abstract: DC Plans, Defined Benefit Plans, and the Accumulation of Retirement Wealth
Excerpt: "This paper simulates the distribution of retirement wealth, as well as the average level of such wealth, under representative DB and DC plans. The analysis considers the role of asset returns, earnings histories, and retirement plan characteristics using data from the Health and Retirement Study (HRS)." (National Bureau of Economic Research; paid subscription or individual purchase required to retrieve full-text)

Working Paper Abstract: Demographic Change, Social Security Systems, and Savings
Excerpt: "Analyzing a cross-country panel of macroeconomic data, [the authors] find that increased longevity raises aggregate savings rates in countries with universal pension coverage and retirement incentives, though the effect disappears in countries with pay-as-you-go systems and high replacement rates." (National Bureau of Economic Research; paid subscription or individual purchase required to retrieve full-text)

Working Paper: Planning and Financial Literacy: How Do Women Fare? (PDF)
25 pages. Excerpt: "[This study] finds that women display much lower levels of literacy than respondents in the total sample. Lack of literacy has implications for planning: women who are less financially literate are less likely to plan for retirement and be successful planners." (Michigan Retirement Research Center)

Opinion: One Company's Group 401(k) Plan Not Invested Wisely in Annuity
Excerpt: "It's unusual to see such a poorly invested 401(k) plan and, frankly, yours looks more like a 101(k) plan. You guys need to become personally involved immediately (or faster) and screw up the courage to ask your lovely, fire-spitting boss to find alternative investments for this lousy performing 401(k)." (The Herald News)

Links to Items on Executive Comp, Benefits in General

Overview from Deloitte: Final IRS Regulations on Electronic Notices, Consents
Excerpt: "[T]he final regulations do not apply to summary plan descriptions (SPDs), summary annual reports (SARs), COBRA notices, or any other notice, election, consent, or disclosure requirements under the Department of Labor's (DOL) or Pension Benefit Guaranty Corporation's (PBGC) regulatory jurisdiction" (Deloitte)

Overview from RIA: Final Rules on Plans' Use of Electronic Media to Provide Notices, Elections, & Consents
Excerpt: "Effective date. The regs apply to applicable notices provided, and to participant elections made, on or after January 1, 2007." (Pension & Benefits Week via RIA News Briefings)

Options Scandal Hits 153 Companies, According to Study
Excerpt: "At least 153 companies have announced internal reviews or U.S. government investigations of past stock option granting practices, said investment research firm Glass Lewis & Co. [yesterday]." (Reuters via The Washington Post; one-time registration required)

Newly Posted Events
(Post Yours!)

"Times are Changing: Are Your Clients Ready?"
in Georgia on November 8, 2006
presented by White Horse Advisors, LLC

Newly Posted Press Releases
(Post Yours!)

Disaster Relief Announcements
(Pension Benefit Guaranty Corporation (PBGC))

U. S. Secretary of Labor Elaine L. Chao Highlights Retirement Security at Convention of Life Insurers
(U.S. Department of Labor, Employee Benefits Security Administration (EBSA))

Opinion: Election 2006: A Shift in Power Spells Trouble for ERISA, Medicare Part D and HSAs
(Findley Davies, Inc.)

New Poll Shows Hispanic Americans Vulnerable in Retirement: Lack Savings, Employer Benefits
(Americans for Secure Retirement (ASR))

Newly Posted or Renewed Job Openings
Post a Help Wanted Ad

Account Executive – Group Employee Benefits
for BWD Group LLC
in NY

Client Service Manager
for Merrill Lynch Retirement Group
in CO

Bilingual Communication Specialist
for 401(k) Advisors
in CA

Benefits Analyst
for National Financial Partners, Inc.
in TX

Benefits Outsourcing Manager - COBRA Administration
for Trion
in PA

Service Analyst - Group Health & Welfare, Investments & Retirement Plans
for Financial Directions Group, Inc.
in NC

Benefits Consultant - Itasca and Chicago
for Gallagher Benefit Services, Inc.
in IL

DB Administrator
for The Rosen Group
in NJ

Plan Document Specialist
for Louis Kravitz & Associates
in CA

Pension Education Consultant
for Diversified Investment Advisors
in CA, IL, TX

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