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Note: No Newsletter Was Published Yesterday (Columbus Day, federal holiday) You should have been informed on Friday that no newsletter would be published on Monday. I apologize for the confusion! --Editor (a) New Guidance Documents (None today.) (b) News Nationwide Fiduciary Breach Suit Survives a New Challenge Excerpt: "A federal judge in Connecticut has cleared the way for the trustees of five 401(k) plans to pursue their claims that Nationwide Financial Services was a fiduciary because it could change the plans' investment lineups." (PLANSPONSOR.com; free registration required) Missouri Judge OKs Defined Contribution Pension Plan for Local Firefighters Excerpt: "The Mehlville, Missouri Fire Protection District (MFPD) board of trustees won a victory for fiscal responsibility when a judge ruled the district may switch employee retirement benefits from a defined benefit to a defined contribution plan." (Heartland Institute) Steel Pensioners Told to Give Some Overpayments Back Excerpt: "The problem was that even though PBGC decided the pensions would be reduced beginning in January 2003, it kept sending full checks for 11 months." (The Morning Call) (c) Summaries of Guidance; Filed Comments Overview: IRS Proposed Regulations on Funding Balances and Benefit Restrictions Under PPA (PDF) 11 pages. Excerpt: "The IRS has issued proposed regulations under the Pension Protection Act of 2006 (PPA) relating to the maintenance of funding balances and restrictions on benefit payments in single-employer defined benefit pension plans. Our August 31 NewsFlash noted some of the highlights of the regulations. This For Your Information explores the proposed regulations in greater depth." (Buck Consultants) Update on Interim Amendments and EGTRRA Restatements Excerpt: "The purpose of this article is to provide you with an update on (1) interim amendments that may be required in the near future, (2) the EGTRRA restatement process, and (3) the implementation of certain PPA provisions." (SunGard Corbel LLC) Hewitt's Global Retirement Update, September 2007 Hewitt's monthly reports summarize retirement and financial management legislative developments and trends from around the world. (Hewitt Associates) (d) Trends, Surveys, Research Workers Still Filling 401(k)s with Company Stock Excerpt: "On top of all the other troubles at Countrywide Financial Corp., the mortgage giant faces a lawsuit from an employee alleging that workers lost hundreds of millions of dollars in their 401(k) retirement plans by holding the company's stock." (Chicago Tribune) Guaranteed or Tax-Free Retirement Income? That's the Choice with Two New 401(k) Investment Options Excerpt: "Recently it has been dawning on the folks who design 401(k)s that the ultimate goal of the plans is to provide a living income in retirement. And that the best time to start planning for that eventuality is when you put the money in. The result is two new 401(k) investment options that may show up in your plan soon." (CNNMoney.com) 401(k)-Type Plans and Individual Retirement Accounts (PDF) Pages 1-13 of 16 pages. Excerpt: "Defined contribution plan growth has topped out: The most current data show that the sharp increase in the number of defined contribution plans and participants, which had grown sharply through the 1990s, had leveled off by 2004. The number of DC plans hit almost 687,000 in 2000, and was down to less than 636,000 in 2004. The number of DC participants reached 52.9 million in 2002 and was down to 52.2 million in 2004. (There are several types of DC retirement plans, which include the 401(k).)" (Employee Benefit Research Institute) Employer Generosity in Employer-Matched 401(k) Plans, 2002-03 (PDF) 9 pages. Excerpt: "In particular, the article focuses on a type of 401(k) plan referred to in NCS publications as a savings and thrift plan. Such a plan determines employers' contributions by applying a matching formula to the contributions made by each employee; employees are required to contribute to the plan in order to receive the employer match." (U.S. Bureau of Labor Statistics) 'Lifestyle Portfolios' Pay Off in 401(k)s Excerpt: "A new study shows that 84.2% of 401(k) participants in John Hancock's funds would have had better results over the last 10 years if they had invested solely in pre-selected portfolios geared to their risk tolerance." (Investment News; free registration required) Fleecing 403(b) Plan Participants -- Fiduciary Liabilities Excerpt: "Many state fiduciary laws incorporate the 'sole interest' and 'exclusive purpose' duties of ERISA. These two duties together express the duty of loyalty - first appearing in eleventh century England - which underlies all trust fiduciary law. The paramount duty of fiduciaries of 403(b) plans where state-level fiduciary law applies to their conduct, then, is to operate such plans solely in the interest of members and beneficiaries for the exclusive purpose of providing them with benefits." (Morningstar) New Institute to Study Pensions Excerpt: "Indiana University-Purdue University Fort Wayne, in conjunction with several organizations, will form an IPFW Institute for Pension Plan Management, the university said in a statement . . . ." (The Journal Gazette) Working Paper: Net Worth and Housing Equity in Retirement Excerpt: "This chapter documents the trends in the life-cycle profiles of net worth and housing equity between 1983 and 2004." (Pension Research Council; registration required to download fulltext of paper) Using Annuity Laddering for Retirement Income Excerpt: "Retirees say they want a regular income check that will be there no matter what. In effect, they want the equivalent of a pension, a dependable source of income that is not subject to the vagaries of the market or other uncertainties. Yet when it comes time to use the savings to purchase a guaranteed lifetime income annuity, they balk. One study, in fact, showed that only 4% of defined contribution plan participants who had an option to annuitize upon leaving the plan chose to do so." (The National Underwriter Company; free registration or paid subscription required) The Effect of Retirement Incentives on Retirement Behavior: Evidence from the Self-Employed in the United States and England (PDF) 45 pages. Excerpt: "In this paper, we examine how public and private pension and health insurance systems affect the retirement transitions. In many countries, public and private pension eligibility, as well as access to health insurance varies between self-employed and wage and salary workers, and these differences are likely to cause differential retirement patterns both within and across countries." (University of Michigan Retirement Research Center) Note: Ways and Means Committee Calls for Comments on PPA Technical Corrections Bill Excerpt: "House Ways and Means Committee Chair Rep. Charles B. Rangel (D-NY) has announced that the Committee is requesting comments from the public on H.R. 3361, a bill that would make certain technical corrections to the Pension Protection Act of 2006 (PPA)." (International Foundation of Employee Benefit Plans) A Conversation with a Fiduciary: Part 2 In this conversation, an attorney follows up an exchange between a plan sponsor and a fiduciary. (Matthew Hutcheson via Morningstar) Chart: State & Local Government Average Pension Benefit -- FY 2006, in Dollars The chart ranks the states by the dollar amount of payouts and also shows the Employee Contributions per Total Receipts. (Empire Center for New York State Policy) (e) Policy, Opinion, Advocacy Opinion: Increase in Lawsuits Against Public Pension Plan Trustees? Excerpt: "There's a clear trend upward in the number of cases involving pension fiduciaries. We're adding 250 to 300 cases each quarter. Most are private sector, but we are fast and furiously adding more public pension cases. I don't think public plan trustees truly appreciate what their liability exposure looks like." (Susan Mangiero via Governing,com) Sponsored by: ASC & the ASC Institute (Click on company name or banner to learn more.)
Links to Items on Executive Comp, Benefits in General Roth 457 Plans Get Fresh Boost in Senate Finance Committee Excerpt: "The Senate Finance Committee has included a Roth 457 provision as a revenue-raiser in a transportation bill the Committee approved Sept. 21 on a 16 to 5 vote. Under the proposal, 457 plans could include qualified Roth contribution programs. As a revenue raising proposal the bill's chances for passage rise significantly." (ICMA-RC) Backdating Employee Stock Options: Accounting and Legal Implications Excerpt: "The authors discuss the accounting treatment of stock options under Accounting Principles Board (APB) Opinion 25, 'Accounting for Stock Issued to Employees,' and SFAS 123(R), Share-Based Payment. Next, the authors examine Sarbanes-Oxley Act (SOX)-related problems that arise from backdated stock options. The article concludes by presenting the potential financial implications of backdating for investors." (The New York State Society of CPAs) Overview: IRS's Limited Extension of Section 409A Compliance Deadline (PDF) Excerpt: "Until further guidance is issued, the cash-out rules in the final regulations - that allow installment or annuity payments to be cashed out if the present value falls below a predetermined amount - may be applied only at the original payment date, and need not be applied throughout the stream of payments." (Drinker Biddle & Reath LLP) Newly Posted Events 401(k) Plans: Beyond the Basics Nationwide on October 18, 2007 presented by SunGard Relius 401(k) Plans: Beyond the Basics in Illinois on November 8, 2007 presented by SunGard Relius ERISA Workshop Nationwide on October 17, 2007 presented by SunGard Relius ERISA Workshop in Florida on October 30, 2007 presented by SunGard Relius ERISA Workshop in Texas on November 1, 2007 presented by SunGard Relius Health Law Seminar - Free in Minnesota on November 7, 2007 presented by U.S. Department of Labor, Employee Benefits Security Administration (EBSA) New Nondiscrimination Rules for Cafeteria Plans: A Wake-Up Call for Employers and Administrators Nationwide on September 20, 2007 presented by Employee Benefits Institute of America (EBIA)/Thomson Tax & Accounting New Proposed Cafeteria Plan Regs: IRS & Experts Analyze Changes - Webcast Nationwide on October 11, 2007 presented by ALI-ABA (American Law Institute-American Bar Association) The Prescription for Rx Plan Management Success in Washington on October 12, 2007 presented by International Society of CEBS - Pacific NW Chapter Newly Posted Press Releases NBCH Launches Community Health Value Collaborative to Prevent Diabetes and Improve Care for Patients with Diabetes National Business Coalition on Health Study Demonstrates Value of John Hancock Lifestyle Portfolios for 401(k) Plan Participants John Hancock Retirement Plan Services Steelworker Retirees Set to Receive New Health Care Benefit United Steelworkers Nation's Disability Policy Makes it Hard to Save for Retirement Goodwill Industries Global Leadership Council Is Formed To Promote Fiduciary Excellence Investment Fiduciary Leadership Council (IFLC) Newly Posted or Renewed Job Openings (Post a Job | View All Jobs | RSS Feed ) Compliance Research Consultant for Diversified Investment Advisors in NY Retirement Plan Sales for National Financial Partners in ANY STATE Defined Contribution / 401(k) Plan Administrator for The Savitz Organization in PA ERISA Tax Associate for Holme Roberts & Owen in CO Client Services Project Leader for Mercer in TX Benefits Manager for Safeway in CA Labor Relations Sr. Manager for 1199 Benefit and Pension Funds in NY 401(k) Administrator for West Pension Solutions, LLC in MD Sr. Employee Benefit Specialist-Retire Secure for The Principal Financial Group in CA Producer for FBD Consulting, Inc. in KS Research Director for Milliman, Inc. in DC Benefits Specialist 5 - Req 07-1024051 for The Boeing Company in WA Outsourcing Team Manager for Trion in PA Retirement Plan Sales Executive for BenefitStreet, Inc. in KS Pension Attorney, Paralegal or Specialist for J.P. Schlachter & Associates, Inc. in OH Compliance Testing Consultant for Diversified Investment Advisors in NY Sr. Employee Benefit Specialist - Retire Secure for The Principal Financial Group in UT Account Manager for McGraw Wentworth in MI 401K) External Wholesaler for John Mulligan & Associates, Inc. in CA, IL Licensing and Commission Administrator for Transamerica Retirement Services in CA Manager - Benefits for 1199 Benefit & Pension Funds in NY Pension Calculation Sr. Manager for 1199 Benefit & Pension Funds in NY Internal Wholesaler for ING, US Financial Services in TN Participant Communication Consultant for Standard Insurance Company in OH ERISA/Employee Benefits Associate for Greensfelder, Hemker & Gale, P.C. in MO Assistant Director of Customer Service for $5 Billion not-for-profit Church Pension Fund in NY Handy Links:
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