| BenefitsLink Retirement Plans Newsletter |   |
February 20, 2007
Sponsored by: Benefit Software Inc.
(Click on company name or banner to learn more.)
| Do your employees know the value of their employer paid benefits? |
| Chances are they don’t. We can help.
Benefit Software has over 25 years of experience helping thousands of employers communicate the full value of their benefits. From traditional personalized printed statements to secure 24/7 employee benefits communication portals, we have the right solution for your organization. Email sales@bsiweb.com or call 800-533-1388 to request free samples. |
The New Pension Law and Defined Benefit Plans: A Surprisingly Good Match
Excerpt: "The new law should improve benefit security, reduce contribution volatility, and encourage responsible management and creative plan design, thereby improving the environment in which defined benefit plans are sponsored by employers and retirement benefits are earned by workers." (Working Paper published by the Pension Research Council)
SEC Web Page for Teachers: Evaluating Your Retirement Options Under a 403(b) Plan
Excerpt: "Let's examine what a 403(b) plan is, and then go through the choices you'll likely need to make if you decide to invest in a 403(b) plan." (Securities and Exchange Commission)
State Retirement Administrators Respond to Call for Use of Corporate Pension Acct'g Assumptions (PDF)
7 pages. Excerpt: "Recent news stories and opinion pieces have stated or implied that public pensions should be using a corporate pension accounting standard to measure actuarial funding levels. This line of thinking suggests that public pensions should use a risk-free investment return assumption rather than the investment return assumption used by most plans of between 7.5 percent and 8.5 percent. To acquaint readers with this argument and the responses, NASRA has compiled below . ." (National Association of State Retirement Administrators)
Directory: Resources for Actuaries on Pension Finance
Excerpt: "Financial economics is influencing the way financial professionals view shareholder risk, including the risk from pension plans. Actuaries and others have been examining what place financial economics might have in the pension actuarial paradigm. The Task Force on Financial Economics and the Actuarial Model has compiled the following resources as an informational tool . . . ." (Society of Actuaries)
Lean Times for Some Multiemployer Pension Plans
Excerpt: "Kocher's is one of dozens of North Jersey and New York meat wholesalers facing a sudden demand by the trustees of the United Food and Commercial Workers (UFCW) Local 174 pension plan for tens of millions of dollars to pay retiree benefits, the wholesalers and union letters say." (NorthJersey.com)
Overview: PBGC and DOL Provide Guidance to Defined Benefits Plans on Premiums, Notices (PDF)
5 pages. Excerpt: "The guidance described in this Pension Analyst affects the calculation of the 2007 flat-rate per participant premium. Plan sponsors and their advisors should familiarize themselves with the information contained in this publication and discuss any questions or concerns they may have with the plan's enrolled actuary." (Prudential Pension Analyst)
Phased Retirement: Problems and Prospects
Excerpt: "This brief begins by exploring the potential benefits of phased retirement. The next section documents the extent of phased retirement in today's workplace and describes the types of people who take it. The following section discusses the problems that employers face when arranging phased retirements. The brief concludes that, while rare today, phased retirement may become more popular in the future." (Center for Retirement Research at Boston College)
Tracking Down Your Long-Lost Pension Payments
Excerpt: "Although traditional plans -- also known as defined-benefit plans -- have a fiduciary obligation to pay benefits, they don't have to chase down potential recipients. Previous employees potentially owed benefits may have died, or they may be working still . . . . And, until beneficiaries collect the money, it stays in the plan, so employers have no incentive to track them down." (Washington Post; free registration required)
Utah Legislature Debates Ability of State Employees to Choose 401(k) Plan Instead of Defined Benefit
Excerpt: "House lawmakers are expected to vote this week on a bill that would give state employees a choice between defined benefit plans -- the traditional pension system -- and defined contribution plans -- employee-stoked 401(k) plans. . . . Audry Wood, executive director of the Utah Public Employees Association, said public employees view [the] bill as a no-confidence vote on their work, and as a retreat from the state government's promise to reward their labors with a good, safe pension." (Salt Lake Tribune)
DROP Reform: Setting the Stage for Downshifting in the Public Sector
Excerpt: "In this volatile era in pension and health benefits for retirees in the private sector, the time is right for public managers to take a second look at their DROP plans and see if they are a necessary tool for managing a workforce or just a union-negotiated gimmick that is alienating the public." (Governing.com)
Chinese New Year Ushers in Pension Reform
Excerpt: "[A new study] describes a 401(k) look-alike known as enterprise annuities. Fixed fees and a local investment requirement are two notable features. Asset allocation constraints are another." (Pension Risk Matters blog by Dr. Susan Mangiero)
Overview: Notice 2007-6 Provides Guidance on Cash Balance Plans (PDF)
5 pages. Excerpt: "Sponsors of cash balance and pension equity plans should carefully read the information contained in this Pension Analyst. We encourage plan sponsors to discuss the contents of this publication with their legal counsel and their plan's enrolled actuary to determine how this most recent guidance impacts their plans." (Prudential Pension Analyst)
Update on Rule 22c-2 Under the Investment Company Act Addressing Market Timing, Frequent Trading (PDF)
At pp. 5-6 of 6-page newsletter. Excerpt: "As a retirement plan sponsor, you should be aware of the following effect on your company's retirement plan and its plan participants: Plan participant information -- specifically, the social security number and transaction types, amounts and dates -- may be requested by each fund, and that information must be provided for delivery to a fund as required by Rule 22c-2." (Invesmart)
Overview: Another Appellate Court Rules in Favor of Cash Balance Plans
Excerpt: "On January 30, 2007, the United States Court of Appeals for the Third Circuit upheld the decision of a district court that the cash balance plan adopted by PNC Financial Services was not age discriminatory. The decision . . . takes a very clear position favoring the legality of cash balance plans and represents the second appellate court opinion in favor of cash balance plans (following the decision of the United States Court of Appeals for the Seventh Circuit . . . .)" (Hewitt)
Opinion: Fifth Circuit's 404(c) Decision in EDS Case Means End of Fiduciary Responsibility
Excerpt: "Since the DOL issued its 404(c) regulation in 1992, it has been generally understood that section 404(c) did not relieve fiduciaries from liability for limiting or designating investment options in a 404(c) plan. . . . I think the reasoning of [the Fifth Circuit in] EDS is deeply flawed, and consequently the petition for rehearing en banc supported by AARP, NELA, the Pension Rights Center, and the DOL itself has a good chance of being granted." (Pension & Benefits Blog (BNA Advisory Board))
Financial Literacy and Retirement Preparedness: Evidence and Implications for Education Programs
Excerpt: "[M]any households are unfamiliar with even the most basic economic concepts needed to make saving and investment decisions. Such financial illiteracy is widespread: the young and older people in the United States and other countries appear woefully under-informed about basic financial computations, with serious implications for saving, retirement planning, mortgages, and other decisions." (Working Paper published by the Pension Research Council)
Pared-Down 401(k)s on Horizon
Excerpt: "THE DAYS of the overpriced 401(k)-type retirement plan are numbered. The word is out. Congress will soon hold hearings on program expenses, and the U.S. Labor Department will issue guidelines on making fees more transparent. Meanwhile, the market has responded to employees who are being gouged on retirement-plan expenses. Enter the bargain 401(k), a stripped-down version of the old-style plan that was loaded with middlemen's fees and with too many costly mutual funds." (John Wasik of Bloomberg News via Inside Bay Area)
Sponsored by: 401khelpcenter.com, LLC
(Click on company name or banner to learn more.)
| Make Your 401(k) Communication a Takeaway, not a Throwaway! |
| Are your 401(k) statement inserts being recycled rather than read? Click above to find out how to help employees "find the money" to save in their accounts. New for 2007-2008! Two stand-alone plan information sheets that help employees understand the "costs" of borrowing from 401(k) accounts and "cashing out" when changing jobs.
"Whether your audience is pre-schoolers or college graduates you’ve got to engage them, not lecture them. 'It’s Your Money' 401(k) information sheets help readers come away with financial savvy they can put to use."
|
| (Please visit our sponsors. We try to make sure their products and services will be of interest to you. Thanks! --Editor) |
Links to Items on Executive Comp, Benefits in General
Overview: IRS and DOL Electronic Media Rules Compared (PDF)
6 pages; terrific side-by-side presentation in a table. (Prudential Pension Analyst)
CEO Pensions: Disclosure, Rent Extraction, and Incentive Contracting
Excerpt: "I examine whether CEOs exploit limited disclosure requirements to hide and/or camouflage excess pension benefits, whether pensions are associated with CEO power and/or contracting determinants, and whether prior to retirement CEOs with pensions manage earnings to increase final pension benefits. Overall, my results provide some support for both the rent extraction and incentive contracting views of pensions." (Working Paper published by the Pension Research Council)
Newly Posted Events
"Popping the Hood on Lifecycle Funds" - Joseph C. Nagengast, CEBS, President, Turnstone Advisory Group LLC
in California on March 7, 2007
presented by International Society of Certified Employee Benefit Specialists - Orange County Chapter
Eligibility Audits for Health Plans (Including Health FSAs and HRAs) -- Protect Your Health Plans by Pruning the Ineligibles
Nationwide on March 22, 2007
presented by Employee Benefits Institute of America Inc. (EBIA)
Recent Legal Decisions Affecting Employee Benefits and Labor Law
in Connecticut on March 15, 2007
presented by Southern New England Chapter ISCEBS
Rollovers From Health FSAs and HRAs to HSAs -- The Transition Relief
Nationwide on February 21, 2007
presented by Employee Benefits Institute of America Inc. (EBIA)
Value-Based Health Design Innovation
in Connecticut on April 10, 2007
presented by Southern New England Chapter ISCEBS
Value-Based Health Design Innovations
in Connecticut on April 10, 2006
presented by Southern New England Chapter ISCEBS
Value-Based Health Design Innovations
in Connecticut on April 10, 2006
presented by Southern New England Chapter ISCEBS
Newly Posted Press Releases
ExpertPlan Grows 40% and Wins Award in 2006 -- ‘07 Expansion Already Underway
ExpertPlan
Fraudulent Telephone Tax Refunds, Abusive Roth IRAs Top Off 2007 “Dirty Dozen” Tax Scams
Internal Revenue Service (IRS)
Human Resource Professionals Call for Clarity in Family and Medical Leave Act
Society for Human Resource Management (SHRM)
Pensions & Investments and Oxford University Report on the Future of Defined Benefit Pension Plans
Pensions & Investments
The Hartford Launches Education Campaign on the Pension Protection Act
The Hartford Financial Services Group
Newly Posted or Renewed Job Openings
Client Service Pension Administrator
for San Diego Pension Consultants, Inc.
in CA
401(k) Client Relationship Manager
for The Douglas Group
in DC, MD, MN, NJ, NY
Account Manager (Insurance/TPA)
for Zenith Administrators
in NV
Plan Administrator
for Independent Pension Consultants, Ltd.
in MN
Senior Consultant, Pension Administration Solutions
for Buck Consultants
in IN, NJ, NY
Senior DC Plan Administrator
for Columbus Retirement Administrators
in OH
Pension Plan Administrator
for McPhillips, Roberts & Deans, PLC Certified Public Accountants and Business Advisors
in VA
Senior Pension Actuary
for Office of the State Actuary (OSA)
in WA
Retirement Plan Administrator
for Lincoln Benefits Group
in PA
Benefits Analyst
for Genuine Parts Company
in GA
ESOP Administrator
for Blue Ridge ESOP Associates
in ANY STATE, VA
DC Compliance Administrator/Client Manager
for Pentec, Inc.
in CT
Human Resource Manager-Loyola University Employees Retirement Program (LUERP).
for Loyola University Chicago
in IL
401(k) Administrator
for Creative Retirement Systems
in OH
Plan Administrator
for Plan Administration Firm - Small to Mid Size Employers
in NV
Operations Specialist
for Professional Capital Services
in PA
Benefits Coordinator (Sr. Human Resources Representative)
for CAE USA Inc.
in FL
Handy Links:
- View Today's Active Message Threads
- Using the Web for Employee Benefits Research (hypertext article)
- Employee Benefits Library
NOTE TO AOL MEMBERS: PLEASE DO NOT REPORT THIS EMAIL AS SPAM. This email is not unsolicited. We do not send unsolicited email. This email is coming to you because you asked to receive it by entering your email address on our web page at
https://benefitslink.com/newsletter/
These emails are sent each workday except federal holidays.
This email has been published by:
BenefitsLink.com, Inc.
1298 Minnesota Avenue, Suite H
Winter Park FL 32789
(407) 644-4146
Fax: (407) 644-2151
David Rhett Baker, J.D., Editor
Copyright 2007 BenefitsLink.com, Inc.; except that you can forward this email in full (including this boilerplate part) or otherwise reprint this email in full (including this boilerplate part) without obtaining our permission.
Anyone can receive these emails; just have them sign up at this web page: https://benefitslink.com/newsletter/
Other useful links: