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| October 26, 2007 |
| Here are the Web's best new links about compliance and cost aspects of plan operation, design and policy. |
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(a) New Guidance Documents
Disaster Relief Announcement 07-25 Relating to Deadlines in Response to Tropical Storm Erin in Texas
Excerpt: "The Pension Benefit Guaranty Corporation is waiving certain penalties and extending certain deadlines in response to Tropical Storm Erin that struck on August 14, 2007, in Texas." (Pension Benefit Guaranty Corporation)
Disaster Relief Announcement 07-24 Relating to Deadlines in Response to Severe Storms and Flooding in Illinois
Excerpt: "The Pension Benefit Guaranty Corporation is waiving certain penalties and extending certain deadlines in response to the severe storms and flooding that occurred on August 20, 2007, in Illinois." (Pension Benefit Guaranty Corporation)
Disaster Relief Announcement 07-23 Relating to Deadlines in Response to Severe Storms and Tornadoes in North Dakota
Excerpt: "The Pension Benefit Guaranty Corporation is waiving certain penalties and extending certain deadlines in response to the severe storms and tornadoes that occurred on August 26, 2007, in North Dakota." (Pension Benefit Guaranty Corporation)
(b) News
Reaction to Final QDIA Regs by Industry Professionals is Positive
Excerpt: "Industry professionals are generally pleased with the final QDIA rules and mostly say the regulation addresses issues they had raised with the Department of Labor." (PLANSPONSOR.com; free registration required)
Midwest Pension Rights Project Loses Funding
Excerpt: "The project helps track down pensions that may be due years after a person left a company or after a spouse has died. Sometimes clients receive a mailing about benefits or the Social Security Administration gives them a letter listing benefits that might be available from a previous employer. The benefits can include pensions, 401(k) plans, military benefits, survivors' benefits or pensions for divorced spouses." (St. Louis Post-Dispatch)
DOL and Congress Move Toward 401(k) Fee Disclosure Rules
Excerpt: "With the House set to adjourn for the year in mid-November, it's unlikely that 401(k) fee legislation will advance far this year. But because the issue is being pursued on dual tracks, companies should gird for directives from Washington." (Workforce Management; free registration required)
(c) Summaries of Guidance; Filed Comments
Fiduciary Issues After the Pension Protection Act of 2006 (PDF)
8 pages. Excerpt: "On August 17, 2006, President Bush signed the Pension Protection Act of 2006 ('PPA') into law. Although the PPA made sweeping changes to pension laws, this article will focus specifically on those changes that have fiduciary implications for defined contribution plans." (The Practical Tax Lawyer via Polsinelli Shalton Flanigan Suelthaus PC)
Chart: Cost-of-Living Adjustments for IRAs, SEPs, Saver's Tax Credit, SARSEP, and SIMPLE Plans (PDF)
3 pages. (Wolters Kluwer Financial Services)
Overview: Extension of Date for Certain Individual Account Plans to Provide Individual Benefit Statements
Excerpt: "On October 12, 2007, the Department of Labor (DOL) issued Field Assistance Bulletin (FAB) 2007-03, which extended the date for administrators of certain individual account defined contribution (DC) plans to provide benefit statements to participants and beneficiaries." (The Segal Group, Inc.)
Hewitt Federal Legislation Quick Guide Updated as of October 24, 2007, for Retirement Plans (PDF)
9 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)
(d) Trends, Surveys, Research
Working Paper: The More the Better? Characteristics and Efficiency of 401(k) Investment Menus
Excerpt: "Few previous studies have explored whether defined contribution retirement saving plans offer sufficiently diversified investment menus, though it is likely that these menus significantly shape workers' accumulations of retirement wealth. This paper assesses the efficiency and performance of 401(k) investment options offered by a large group of US employers. We show that the majority of plans is efficient compared to market benchmark indexes." (Pension Research Council; registration required to download fulltext of paper)
More 401(k) Plans Offering Automatic Enrollment, PSCA Survey Finds
Excerpt: "Automatic enrollment and participation levels continued to trend upward during the 2006 plan year, according to an annual survey of profit-sharing and 401(k) plans released by the Profit Sharing/401k Council of America (PSCA)." (Wolters Kluwer Financial Services)
Employee Education Is the Key to Successful Open Enrollment
Excerpt: "The underlying purpose of . . . edification tactics actually end up being twofold. Not only will they improve the knowledge about benefit information amongst the workforce, but it also presents the employer with an opportunity to reiterate to the employee how valuable of an asset they are. These two effects work in synergy to maintain a workforce that is happier and (hopefully) healthier." (The PRECEPT Employee Benefits Blog)
Housing Market Mess: Subprime Mortgage Fallout May Jeopardize Pensions
Excerpt: "Some public and private pension funds may feel aftershocks from the recent slew of defaults on subprime mortgages, depending on their investment allocations and what happens to interest rates, industry experts say." (Employee Benefit News; free registration required)
Brokering a Deal: Aon Execs Propose Allowing Defined Benefit Sponsors to 'Sell' Troubled Plans
Excerpt: "'The Chinese symbol for change is a combination of the symbols for risk and opportunity.' That is how Scott Macey, senior vice president at Aon Consulting, began making his case for a proposal that would allow sponsors of frozen defined benefit plans to sell the plans to more financially sound corporations or banks." (Employee Benefit News; free registration required)
Dusty IRS Rule Not a Cure-All for Lax Retirement Planning
Excerpt: "A new strategy for employers in overcoming workers' investing and retirement planning inertia lies in a decade-old Internal Revenue Service ruling that only recently has attracted attention from benefits consultants and industry professionals. The IRS ruling, in place since 1997, permits companies to contribute the cash value of their employee's unused vacation time and put it into their 401(k) plans." (Employee Benefit News; free registration required)
(e) Policy, Opinion, Advocacy
Lack of Plans Is a Small Business Retirement Time Bomb
Excerpt: "Small businesses are a critical part of the retirement problem because they create as much as 80 percent of the nation's net new jobs every year. Thus, many young people are likely to start out working for a small business that doesn't provide a savings plan when they most need to start one. In addition, low-income workers, who are least likely to save for retirement, are also most likely to be working for small firms." (The New York Times; free registration required)
Working Paper: Why Do Married Men Claim Social Security Benefits So Early? Ignorance or Caddishness?
Excerpt: "Most married men claim Social Security benefits at age 62 or 63, well short of both Social Security's Full Retirement Age and the age that maximizes the household's expected present value of benefits (EPVB). This results in a loss of less than 4 percent in household EPBV. But essentially the entire loss is born by the survivor benefit, falls nearly 20 percent. As many elderly widows have very low incomes, early claiming by married men is a major social problem." (Center for Retirement Research at Boston College)
Links to Items on Executive Comp, Benefits in General
Hewitt Federal Legislation Quick Guide for October 24, 2007, on Human Resources & Employment Law (PDF)
13 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)
Health Care, Retirement Challenges Make Employers, Consultants Closer Allies
Excerpt: "Consultants are working more closely with their employer clients these days, particularly as employers attempt to implement health care cost-containment programs - including wellness and weight management - as part of a broader effort to create a healthier workforce. Meanwhile, the unfamiliar regulations of PPA have employers seeking daily advice on auto-enrollment, pension funding levels, cash balance plans and other features of the law." (Employee Benefit News; free registration required)
Newly Posted Events
Form 1099 Refresher Course
Nationwide on November 7, 2007
presented by ftwilliam.com
What You Need to Know About the 2007 Required Amendments
Nationwide on November 2, 2007
presented by ftwilliam.com
Newly Posted Press Releases
NCQA & U.S.News & World Report Release Annual Rankings for "America's Best Health Plans"
National Committee for Quality Assurance (NCQA)
Newly Posted or Renewed Job Openings
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Benefits Analyst - Arlington, VA
for Watson Wyatt Worldwide
in VA
Benefit Funds Administrator
for Segal on behalf of a client
in MA
Pension Plan Administrator
for Future Planning Associates, Inc.
in VT
ERISA Consultant Small Plans
for New York Life Retirement Plan Services
in MA
Employee Benefits Associate Attorney
for Gray Plant Mooty
in MN
Installation Administrator
for Transamerica Retirement Services
in CA
Consultant
for Pension Benefits Unlimited, Inc.
in CA
Market Development Specialist/Wholesaler
for Transamerica Retirement Services
in MA
409A Plan Administrator / 409A Senior Plan Administrator
for Pen-Cal Administrators
in CA
Signing Bonus / Senior DC Plan Administrator
for Berlin, Ramos & Company
in MD
Handy Links:
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- Using the Web for Employee Benefits Research (hypertext article)
- Employee Benefits Library
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