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January 24, 2008

Here are the Web's best new links about compliance and cost aspects of plan operation, design and policy.

Today's sponsor is National Institute of Pension Administrators (NIPA)

(Click on company name or banner to learn more.)
Banner ad for National Institute of Pension Administrators (NIPA)

Enhance Industry Knowledge at the 2008 NIPA Annual Forum & Expo!

Join fellow retirement plan professionals for three days of education and social networking at the premier industry event designed by retirement plan professionals, for retirement plan professionals.

The 2008NAFE is the ideal venue to enhance industry knowledge through 25 education sessions, exchange business best practices and peruse the expanding exhibit hall floor -- featuring the top industry vendors' cutting-edge products and solutions.

[Guidance Overview] Saver's Credit for 2007 (PDF)
1 page. Excerpt: "The Saver's Credit was made permanent in the Pension Protection Act of 2006, and it is important that plan sponsors let their participants know about this significant benefit. The tax credit ranges from 10 to 50 percent of each $1.00 contributed, up to the first $2,000 put in the 401(k)." (Profit Sharing/401(k) Council of America)

[Guidance Overview] DOL's Opinion Letter on Pension Assets and Politically Motivated Proxy Activity
Excerpt: "Under ERISA, plan fiduciaries must act solely in the interest of plan participants and beneficiaries. Plan fiduciaries may not increase expenses, sacrifice investment returns or reduce the security of plan benefits to support or promote goals not directly related to the plan.' (Watson Wyatt Worldwide)

[Guidance Overview] Form 5500 in Transition
Excerpt: "Some changes to Form 5500 required by the Pension Protection Act of 2006 (PPA) will appear in the 2008 form. The 2007 forms and schedules will remain the same (except for plans with 25 or fewer participants and a few updates to the Schedule B instructions)." (Watson Wyatt Worldwide)

[Guidance Overview] IRS Proposed Regulations on PPA Requirements for Hybrid Plans
Excerpt: "The PPA requires conversions after June 29, 2005, to take an A+B approach (where 'A' is the benefit based on the pre-conversion formula, taking into account service up to the conversion, and 'B' is the benefit under the new cash balance formula, taking into account only post-conversion service). The proposed regulations apply this requirement to section 411(d)(6)-protected benefits earned before and after the conversion." (Watson Wyatt Worldwide)

Advice to Investors: Sit Tight and Batten Down the Hatches
Excerpt: "The worldwide collapse of stock prices has many victims -- pension funds, insurance companies, hedge funds, financial services firms. But those are players who, if they are smart, have the wherewithal to withstand a steep sell-off. . . . . What about the small investor, the individual who is socking away modest sums for retirement or college costs? Should small investors rush for the sidelines? Or should they view this as a buying opportunity and plough more money into the market?" (Wharton School of the University of Pennsylvania)

Message to Participants with Self-Directed Accounts: You Can Ride It Out
Excerpt: "'Pulling your money out when everything is tanking is just not a good idea,' says Don Blandin, president and chief executive of the Investor Protection Trust, a nonprofit investor education organization. If you don't need your money for years to come, then stay the course, Blandin and many other experts advise. Even if you're close to retirement and you haven't rebalanced your portfolio in a while, you may still want to sit tight 'until the dust settles,' Blandin said." (The Washington Post; free registration required)

Fewer 401(k) Savers Would Face Inadequate Nest Eggs if Advisers Defined a Contribution Rate (PDF)
4 pages. Excerpt: "What participants need is specific numbers on the percentage of their salary they need to save now to achieve their goal -- depending on when they start saving and how well they invest their money. For this purpose, we would like to discuss the concept of retirement sufficiency, which is defined as the nest egg that one needs to accumulate in order to maintain his or her pre-retirement standard of living after retirement." (American Society of Pension Professionals & Actuaries)

If Stock Market Heads South Just As You've Retired, or Are About to - What Should You Do with Your Retirement Funds?
Excerpt: "Ideally, even retirees and those near retirement should not let volatility drive them out of the equity markets. Brett Hammond, chief investment officer for TIAA-CREF, said his firm's Lifecycle Funds allocate as much as 50 percent of retiree portfolios to stocks, with the rest in fixed-income investments such as bonds." (The Washington Post; free registration required)

Why Have Some States Introduced Defined Contribution Plans?
Excerpt: "Although defined benefit plans dominate the state and local sector, in the last decade twelve states have introduced some form of defined contribution plan. The degree of compulsion varies among these states from mandatory participation in a defined contribution plan for new employees, to mandatory participation in both a defined benefit and defined contribution plan, to having the defined contribution plan only as an option." (Center for Retirement Research at Boston College)

[Opinion] Supreme Court Missed a Chance to Protect Pension Funds, Investors
Excerpt: "The big case, of course, was a suit filed by the University of California to recoup tens of millions of dollars its pension plan lost in the Enron collapse of 2001. Pennsylvania officials, as did those in 32 other states, had joined this suit because state pension funds lost $70 million when the Texas energy company went bankrupt. Other investors were party to the suit, too. When Enron's balloon, inflated by financial deceit and accounting trickery, burst, it cost thousands their jobs, blew a $60 billion hole in the national economy and $2 billion evaporated from pension plans around the country." (The Morning Call)

Sponsored by: Deloitte Consulting LLP, The International Foundation and The International Society of Certified Employee Benefit Specialists (ISCEBS)

Don't Miss Your Opportunity to Participate in the Annual 401(k) Benchmarking Survey

Don't miss your opportunity to participate in the Annual 401(k) Benchmarking Survey of employers (click here) across the nation on their 401(k) plans.

Conducted by the Human Capital Service Area of Deloitte Consulting LLP, The International Foundation, and The International Society of Certified Employee Benefit Specialists (ISCEBS).

All participants will receive a complimentary copy of the survey findings.

(The original deadline for the survey has been extended to January 31st.)

(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

Pet Insurance Gaining Popularity As an Employee Benefit
Excerpt: "The growth of this perk comes as pets occupy an increasingly prominent place in the American home. According to the American Pet Products Manufacturers Association, pet owners spent an estimated $9.8 billion on veterinary care in 2007, up from $7.1 billion in 2001." (AP via Connecticut Post Online)

IRS Provides 'Free File' Program Available to 70% of Population; Employers Can Tell Employees About It
Excerpt: "The Internal Revenue Service is working with the Society for Human Resource Management to promote the use of the IRS electronic Free File program, a free online tax preparation service for those earning $54,000 or less. 'It's important for HR managers, and employers in general, to understand that their employees may very well be just like every other American, a little bit confused about the tax system, unsure as to how to deal with it, and wanting to comply with the tax laws but wanting help to do so,' says David Williams, IRS director of electronic administration." (Society for Human Resource Management)

FMLA Expansion for Military Family Headed to White House Again
Excerpt: "Congress has given its final stamp of approval to an expansion of the federal Family and Medical Leave Act (FMLA) to family members of active duty military service personnel." (; free registration required)

State and Local Governments - Growing Fiscal Challenges Will Emerge (PDF)
78 pages. Excerpt: "As happens at the federal level, these subnational governments may also face serious fiscal stress in the future. To provide Congress and the public with a broader perspective on our nation's fiscal outlook, GAO has developed a fiscal model of the state and local sector. This unique model enables GAO to simulate fiscal outcomes for the entire state and local government sector for several decades into the future." (U.S. Government Accountability Office)

The 2007 Legislative Session
Excerpt: "Mental health parity. 401(k) fees. Deferred compensation. COBRA. Carried interest. Medicare. Expatriate taxation. These are just some of the benefit and compensation issues Congress discussed last year. During 2007, lawmakers evinced a continuing desire to enact legislation that would affect employer-sponsored health, retirement and compensation programs yet very little of that legislation passed. The year also marked the emergence of new issues that would affect plan investments." (Watson Wyatt Worldwide)

Newly Posted Events
(Post Yours!)

Common 401(k) Plan Mistakes Webcast
Nationwide on February 7, 2008
presented by National Institute of Pension Administrators

Individual Mandates: Requiring Individuals to Purchase Health Insurance - Webcast
Nationwide on January 31, 2008
presented by

Qualified Medical Child Support Orders: Election Changes, Privacy, and Rights of Employees, Children, and Custodial Parents
Nationwide on February 14, 2008
presented by Employee Benefits Institute of America (EBIA)/Thomson Tax & Accounting

Rebroadcast of Final 403(b) Regulations Webcast
Nationwide on January 23, 2008
presented by NAGDCA (National Association of Government Defined Contribution Administrators, Inc.)

Surviving a DOL audit
in California on February 6, 2008
presented by International Society of Certified Employee Benefit Specialists - Orange County Chapter

Newly Posted Press Releases
(Post Yours!)

ASPPA (American Society of Pension Professionals & Actuaries)

Variety of Challenges Make Affordable Health Care Options Elusive for Small Businesses
U.S. House Small Business Committee

2008 Open Enrollment Data Shows That 92.7 Percent of Wal-Mart Associates Now Have Health Coverage
Wal-Mart Stores, Inc.

MassMutual Adds First Retirement Income Withdrawal Benefit

Aon Consulting to Offer ELMsm Annuities to Clients
ELM Income Group, Inc

Mercer's New Pharmacy Benefit Design Improves Compliance

Top 1,000 U.S. Retirement Plan Assets Enjoy Strongest Growth in a Decade
Crain Communications, Inc.

Report Finds Philadelphia's Pension and Health Care Costs for Public Employees Growing at Unsupportable Rates
Pew Charitable Trusts

Benefitfocus Expands Reach to Consumers With ConnectYourCare Partnership

How Can I Afford Retirement? -- A Free Investor Education Program at the Boston Public Library
Boston Public Library

Study Says Allergy Shots Help Children, Reduce Health Care Costs
BioMedEcon, LLC

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Benefits Compliance Manager
for SunTrust Banks Inc.
in GA

Deputy Regional Director
for U.S. Department of Labor, Employee Benefits Security Administration
in GA

Senior Associate/ Consultant compensation
for Buck Consultants
in CT, IL, NJ, NY, PA

Senior Pension Consultant
for Preferred Pension Planning corporation
in NJ

Qualified Plan Consultant and Manager
for Destel-Bergen Corporation
in CA

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