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May 17, 2007
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Sponsored by: DATAIR Employee Benefit Systems, Inc.

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From the IRS - Retirement News for Employers, Spring 2007 (PDF)
13 pages. Excerpt: "This issue includes the following: Final 415 Regulations Published; Critical FewPoints...by Director, EP Examinations; The Fix Is In: Common Plan Mistakes; Product Profile - Retirement Plans for Small Business (SEP, SIMPLE, and Qualified Plans); Final Designated Roth Accounts Under Sec. 402A Regs. Published; and, EP TDI Notices." (Internal Revenue Service)

Chrysler Pension Fund to Get $1.2 Billion
Excerpt: "DaimlerChrysler and Cerberus Capital Management, which is buying Chrysler Group, have agreed to invest $1.2 billion in the pension fund of Chrysler workers under terms of the sale, according to their union, the United Automobile Workers." (International Herald Tribune)

Fee-Based Advisers May Get 120 Days to Learn Fiduciary Rules
Excerpt: "The SEC says it won't pursue an appeal of the recent circuit court's decision ending the exemption that allowed fee-based advisers to operate under the fiduciary radar. The commission would like the court to give these advisers some time though -- 120 days -- to familiarize themselves with fiduciary rules." (Employee Benefit News)

Higher Discount Rates Lowering Pension Liabilities
Excerpt: "Rising long-term interest rates have pushed discount rates higher in much of the world, easing pension fund liabilities. Discount rates in many of the countries Watson Wyatt surveyed in its forthcoming 2007 Global Survey of Accounting Assumptions for Defined Benefit Plans have increased between the end of 2005 and 2006." (Watson Wyatt Worldwide)

Current Pension Regulatory Outlook on 401(k) Plan Fees
Excerpt: "In this month's current outlook, we briefly review several recent developments in the various regulatory and legislative initiatives concerning 401(k) plan fees." (CCA Strategies)

Nine Great Steps to Making the Most of Your 401(k) Program (PDF)
12 pages. Excerpt: "You now know there are affordable, simplified 401(k) plans for your business, even if you're self-employed. You see the unique benefits 401(k)s offer in terms of savings and tax advantages, and that a 401(k) makes a strong recruiting and retention tool. If you have employees, your question now may be, 'How do I design a program that can be successful for my business?'" (ShareBuilder Corporation)

Mercer Recommends Plan Sponsors Take Proactive Approach to Fee Disclosure
Excerpt: "Citing the 'high profile' of the topic of fee disclosure, Mercer cautions that the SEC is seeking to require that mutual funds provide improved disclosure and that the Labor Department is planning to issue guidance later this year." (Wolters Kluwer Law & Business)

Overview: New IRA Rollover Rules for Nonspouse Beneficiaries
Excerpt: "Beginning in 2007, a nonspousal beneficiary of a deceased person's qualified retirement plan account (including a Section 403(a) annuity, a Section 403(b) annuity, or a governmental Section 457 plan account) can set up an IRA to receive a tax-free rollover of a plan distribution." (SmartMoney)

Overview of Wall Street Journal Article Entitled 'Pension Tension: Figuring Out When to Lump It'
Excerpt: "[T]he author says more Americans are facing a critical question as they reach retirement -- whether to take pension benefits as a single one-time cash payout or as a lifetime stream of monthly payments. Private companies are increasingly giving retiring employees that choice, and pension consultants say that most retirees take the lump sum when they can." (Cypen & Cypen)

Washington Teachers Challenge 'Gain-Sharing' Law Repeal
Excerpt: "Teachers in Washington state filed suit against the state, claiming that legislative action revoking a 1998 'gain-sharing' law is unconstitutional and will cost them future pension losses, according to Associated Press." (PLANSPONSOR.com; free registration required)

Overview of a NBER Working Paper: 'Simplification Raises Saving Rates'
Excerpt: "Criticisms of America's low national savings rate often hinge on the assumption that this low savings is driven by Americans' proclivity for excessive spending. But according to researchers with the National Bureau of Economic Research (NBER), the complexity of establishing a savings plan can also play a role in deterring saving." (National Center for Policy Analysis)

Saving with a SEP IRA Retirement Plan
Excerpt: "When planning for retirement, one option for some people is the SEP IRA. The SEP IRA stands for simplified Employee Pension Individual Retirement Account. This is a special type a retirement plan designed for small business and the self-employed." (Best Syndication)

How Investors Are Using Retirement Money to Buy Stock in Bank Start-Ups
Excerpt: "'[T]he dirty little secret your broker doesn't tell you about,' namely that individuals can invest their personal retirement assets -- IRAs, 401(k) rollovers, Keoghs, and more -- in pretty much anything they want, including startup banks." (Bank Director Magazine)

Hewitt Federal Legislation Quick Guide Updated as of May 15, 2007, for Retirement Plans (PDF)
6 pages. This Federal Legislation Quick Guide provides short updates on federal legislation that is currently under active consideration by Congress or has recently been enacted into law regarding retirement plans. (Hewitt Associates)

Opinion: Social Security Is for Suckers - Can You Retire on What It Will Really Give You?
Excerpt: "Based on the most recently available data, the average Social Security benefit received by a retiree's family is $1,097.95 per month -- $13,175.40 per year. That's less than a full-time, minimum-wage job in some states." (The Motley Fool via MSNBC)

Working Paper: Savings for Life - A Pathway to Financial Security for All Americans
Excerpt: "Given the right savings vehicles with the right incentives for both individual savers and the financial services industry, more Americans can access the pathway to greater savings. The Initiative on Financial Security at the Aspen Institute has developed a package of four complementary savings vehicles that can significantly improve the savings options for all Americans across the lifespan . . . ." (Social Science Research Network)

Retirement Plan Cost Greatest Barrier for 62% of Micro-Business Owners
Excerpt: "About 80% of micro-businesses do not offer retirement plans to their owners or retirees, and only 5% of micro-businesses say they plan to offer a retirement plan in the next year, according to the findings of a survey by the National Association for the Self-Employed (NASE)." (PLANSPONSOR.com; free registration required)

Executive Summary: 2007 Phoenix Wealth Survey
6 pages. Excerpt: "[T]he 2007 Phoenix Wealth Survey . . . exposes a generation gap as the youngest of the high net worth are the most bearish for the future. Despite having more money and at a younger age than their predecessors, Gen-X millionaires display the greatest uncertainty about their retirement finances as they face retirement without traditional pension plans and with Social Security benefits in doubt." (The Phoenix Companies, Inc.)

Opinion: New Pension Plan in Malaysia Is a Big Let Down
Excerpt: "Cuepacs must take a firm stand and should not compromise the pension rights of public sector employees, says A J Patrick. The government has proposed a new pension scheme which requires public sector employees to contribute 11 per cent of their salary to match the government's 12 per cent contribution to the new retirement fund, which will replace the existing Pension Trust Fund." (Aliran)

United Kingdom Pensions Update, April 2007
Excerpt: "This newsletter summarizes key regulatory and legal developments in the UK Pensions sector. The April 2007 issue includes information on the Pensions Regulator's new e-learning module, the new PPF regulations and the Auditing Practices Board's revised guidance." (Baker & McKenzie)

Australia's Superannuation Tax Scheme Leading to Inconsistencies
Excerpt: "The law simplifying superannuation taxes, which will begin to take effect on July 1, 2007, is creating a number of anomalies in the way that death and disability benefits are treated." (Watson Wyatt Worldwide)


Sponsored by: ASPPA

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Banner ad for ASPPA

Advanced Actuarial Conference -- Boston, MA, June 5-6, 2007

Designed by practicing pension actuaries specifically to address their unique and specialized needs, this conference covers a wide variety of current and timely issues. Workshops and general sessions will be dedicated to topics including PPA, Future DB Policy Initiatives, Yield Curve, RP 2000 Mortality Tables and Hybrid Plans. Join your fellow pension actuary colleagues at this one of a kind event.

(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

Deloitte Says Pay More Attention to New FASB Valuation Standard
Excerpt: "Only 6 % of companies in a new survey have assessed how Financial Accounting Standards Board (FASB) Statement No. 157 (SFAS 157), Fair Value Measurement, will impact the valuation of their assets and liabilities." (PLANSPONSOR.com; free registration required)

Employer Malpractice Claims Against Service Providers - A User's Guide
Excerpt: "Preemption under § 514(a) covers 'any and all State laws' that 'relate to' an ERISA plan. 29 U.S.C. § 1144(a). What is the implication of that provision for employers that assert state law claims, such as negligence or misrepresentation, against service providers to their ERISA plans?" (Health Plan Law blog by Attorney Roy F. Harmon III)

Time-Vested Restricted Shares Gaining Popularity as Executive Compensation
Excerpt: "A majority (63%) of U.S. companies are now offering their executives time-vested restricted shares, an incentive that was once most popular as a tool to retain middle managers, according to the Hay Group's 2006 study of executive compensation." (PLANSPONSOR.com; free registration required)

Overview: SEC's Proxy Disclosure Rules on Executive Defined Benefit Retirement Plans (PDF)
Excerpt: "The key intent of the newly finalized Securities and Exchange Commission's (SEC's) proxy disclosure rules is to give investors a handle on the total compensation that public companies pay to their senior executives. Until now, fully understanding this concept has been a complex undertaking because senior executives' total compensation is typically derived from numerous programs, and amounts were not disclosed for some of these programs." (Buck Consultants)

Executive Summaries: Benefits Quarterly, 2nd Quarter, 2007, Articles
Excerpt: "The 2nd Quarter issue covers personal responsibility for benefits." (International Society of Certified Employee Benefit Specialists)

Hewitt Federal Legislation Quick Guide for May 15, 2007, on Human Resources & Employment Law (PDF)
11 pages. This Federal Legislation Quick Guide provides short updates on federal legislation that is currently under active consideration by Congress or has recently been enacted into law regarding human resources and employment law. (Hewitt Associates)


Newly Posted Events

2007 SPARK National Conference
in District of Columbia on June 24, 2007
presented by SPARK -- Society of Professional Asset-Managers and Record Keepers

Do You Have to Pay A Royalty on Your ERISA and Tax Advice?
Nationwide on June 14, 2007
presented by ABA Joint Committee on Employee Benefits

Lunch with Congressional Expert Witness on Retirement Plan Hidden Fees - Matthew D. Hutcheson
in Florida on May 25, 2007
presented by ASPPA Benefits Council of Central Florida


Newly Posted Press Releases

U. S. Labor Department Resolves Lawsuit With Owners of Charlotte, N.C. Manufacturer Over Loans From Profit-sharing Plan
U.S. Department of Labor, Employee Benefits Security Administration (EBSA)

U.S. Companies Are Relying More on Time-Vested Restricted Share Plans, Despite European Market's Shift Away Years Ago, According to New Hay Group Executive Compensation Study
Hay Group

Awards Recognizing Leadership In Incentives & Rewards Presented At National Employer Symposium
National Business Coalition on Health

Arizona Investors Have A New Local Resource For Assistance In Diversifying Their Self-Directed IRAs
Polycomp Administrative Services, Inc.

Polycomp Expands Self-Directed IRA Business Into Arizona Market By Opening New Scottsdale Office To Offer Local Support To Arizona IRA Investors
Polycomp Administrative Services, Inc.

Social(k) and Fidelity Out of Sudan Target Companies to Divest Retirement Funds from Fidelity Investments over Sudan
Social(k)

7.5% Payroll Tax Will Devastate California's Small Business Economy
California Small Business Health Coalition


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401(k)/Defined Contribution Valuation Processor
for National Retirement Services, Inc.
in CA, NC

Account Executive Assistant
for The Paragon Alliance Group
in PA

HM Benefits Service Manager
for Hewitt Associates
in GA

Retirement Plan Administrator
for Omega Recordkeeping Group LLC
in FL

Senior Manager - Compensation Accounting
for Charles Schwab
in CA

Recordkeeper/Administrator
for Retirement Strategies Group, LLC.
in LA

Director Global Benefits
for Agilent Technologies
in CA

Client Relationship Manager - San Mateo, CA
for Transamerica Retirement Services
in CA

Internal Wholesale Director
for Transamerica
in MN

Pension Administrator
for AKT Retirement Plan Services
in CA

Defined Benefit Administration Software Consultant
for Winklevoss Technologies
in CT

Retirement & Institutional Sales Officer
for BOK Financial
in TX




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