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May 2, 2008

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

Today's sponsor is

(Click on company name or banner to learn more.)
Banner ad for now has TWO NEW 403(b) plan documents! now offers a full-scope 403(b) plan document with an ERISA/non-ERISA option that allows sponsors (including churches, non-profits, or public schools) to provide matching, non-elective contributions and elective deferrals; and a limited-scope 403(b) plan document (non-elective contributions, non-ERISA only).
Both documents are updated with the final regulations, include context-sensitive help buttons, forms and amendments, streamlined data import and export and online error correction.
Contact or call 800.596.0714 for additional information.

[Official Guidance] Internal Revenue Bulletin No. 2008-17, April 28, 2008, Containing Notice 2008-45 (PDF)
44 pages. Excerpt: "This notice contains updates for interest rates for funding requirements under sections 412(b)(5)(B) and 430(h)(2) of the Code applicable for April 2008, and updates for interest rates for minimum present value determinations under 417(e)(3) of the Code for March 2008." (Internal Revenue Service)

[Guidance Overview] Getting PPA Funding Right
Excerpt: "The Pension Protection Act (PPA) requires a fundamental change in how sponsors think about pension funding. In this article, we discuss the new strategies that apply under PPA. We will identify the key issues you should be considering when you approach the PPA funding challenge." (JPMorgan Chase & Co.)

[Guidance Overview] Listing of IRS Published Guidance for January - April 2008
The target page links to guidance published by the Service relating to retirement plans: Treasury Regulations; Revenue Rulings; Revenue Procedures; Notices; and, Announcements. (Internal Revenue Service)

[Guidance Overview] DOL Proposal of Safe Harbor for Deposits to Small Plans
Excerpt: "The proposed seven-day safe harbor for deposits to small plans is welcome relief from a confusing requirement. EBSA indicates that it is open to extending the safe harbor to larger (100 or more participant) plans, if it receives compelling arguments during the comment period for the proposed regulations. In the meantime, employers and plan trustees should review the timeliness of deposits and take action to correct any delinquencies discovered." (Bond, Schoeneck & King, PLLC)

[Guidance Overview] Converting Retirement Plan Funds to a Roth IRA
Excerpt: "If your client wants to convert employer plan funds directly to a Roth IRA, there are some new Internal Revenue Service (IRS) rules you should be aware of. The Pension Protection Act of 2006 (PPA) allows such conversions beginning in 2008. In some cases, after-tax plan funds can be converted to a Roth IRA tax-free, if only those funds are converted and the remaining plan funds are rolled to a traditional IRA. Notice 2008-30 confirms that Roth conversions can be done from employer plans such as 401(k)s, 403(b)s and 457s." (Financial Planning)

Ten Techniques for Communicating with Employees About Retirement Plans
Excerpt: "Our 10 proven techniques for communicating about retirement plans are broken into three categories: getting better attendance, understanding the concepts and taking action." (Employee Benefit News; free registration required)

The U.S. Retirement Market, Third Quarter 2007 (PDF)
22 pages. Excerpt: "Total U.S. retirement assets climbed to $17.8 trillion as of Sept. 30, 2007, up from $17.5 trillion on June 30, 2007. Retirement savings account for almost 40 percent of all household financial assets in the United States." (Investment Company Institute)

American Airlines Staves Off Pension Funding Provision
Excerpt: "The Fort Worth Star-Telegram reported that senators ultimately stripped out of a funding measure for the Federal Aviation Administration (FAA) a provision that could have cost the airline hundreds of millions of dollars in added annual pension costs. The newspaper said Senators Kay Bailey Hutchison (R-Texas) and Dick Durbin (D-Illinois) co-sponsored an amendment to the FAA spending bill stripping out the provision that affected both American and Continental Airlines." (; free registration required)

Should Government Pension Valuations Follow Corporate Pensions' Path?
Excerpt: "While some believe public pension plans should continue their current actuarial methods for calculating liabilities and funding, others argue that the current methods do not give a true picture of a plan's financial status as market-based calculations would." (; free registration required)

U.S. Public Pensions - Should Liabilities Be Valued Same Way Financial Markets Value Government Debt (PDF)
8 pages. (The Bank of New York Mellon Corporation)

Safeguard Your Retirement in Hard Times
Excerpt: "When your income is not covering all your expenses, it can be tempting to simply cut out the expense of saving for retirement -- or tap the savings in your 401(k) or IRA to pay the bills. But there will always be negative consequences to those actions. If you simply stop saving, you'll almost certainly reduce the amount of money available to you when you decide to retire, and you may even have to postpone your retirement." (BusinessWeek)

Buffett - New Advice
Excerpt: "The purpose of Buffett's Investment 101 course is to throw doubt on the premises of pension funds to assume they can make 8% a year. He attacks with cynicism those CEOs who present themselves as able to report higher earnings per share and thus promote their stock prices if they assume an 8% return on the corporate pension plan. In other words, it's another make-believe game by corporate executives whose concern is to 'juice earnings.'" (

401(k) Providers Buyer's Guide, 2008
Excerpt: "The complete results are offered as Excel spreadsheets; if you'd like to download these files and you're not a member of, [then will] need an email address, user name, and password." (

What Can Plan Sponsors Do to Head Off 401(k) Plan Fee Trouble?
Excerpt: "Over the years, as more providers have gotten into the defined-contribution business, their fees and behind-the-scenes revenue-sharing arrangements have become so complex that plan-expense comparisons are virtually unattainable. And that's a problem. If plan sponsors can't ascertain the true cost of their defined-contribution plans, they certainly can't explain fees to plan participants, who pick up many of these expenses." (

How Will Low-Income Boomers Cope with Retirement?
Excerpt: "The report finds that, because of long-term projected growth in real earnings, low-income boomers will have higher real incomes in retirement than their predecessors and a lower incidence of poverty. Typical leading boomers will have higher income replacement rates at retirement and will be more likely to have enough income to replace 75 percent of their earnings than previous generations of retirees. However, typical trailing boomers will have much lower replacement rates in retirement than leading boomers (although about the same as earlier retirees) and will be less likely to have enough income to replace 75 percent of their earnings than leading boomers." (AARP)

Older Workers: Federal Agencies Face Challenges, But Have Opportunities to Hire and Retain Experienced Employees (PDF)
30 pages. Excerpt: "The Chairman of the Senate Special Committee on Aging asked GAO to discuss (1) the age and retirement eligibility trends of the current federal workforce, (2) the strategies federal agencies are using to hire and retain older workers, and (3) our observations on how these strategies position federal agencies to engage and retain older workers." (U.S. Government Accountability Office)

Sponsored by: Investment Company Institute

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Banner ad for Investment Company Institute

June 3rd ICI Conference on DC Plans in the PPA Era

Register today for the Investment Company Institute's June 3rd conference on legal and business issues for 401(k) plans, 403(b) plans, and IRAs. Speakers include senior representatives from the Departments of Labor and Treasury and the mutual fund industry. Topics include:
  • DOL's 401(k) plan fee disclosure agenda and fee-related developments
  • PPA implementation update
  • Participant notices and statements
  • The future of 403(b) plans

(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

[Guidance Overview] Maryland Amends Wage Payment and Collection Law; Provides Clear Answer for Employers with Respect to Accrued Leave
Excerpt: "A recent amendment to the Maryland Wage Payment Collection Law finally provides both employers and employees with a clear idea as to when accrued leave is paid out on termination. Whether an employer is obligated to pay out unused accrued time depends on the employer's written policy and whether this policy was communicated to the employee at the time of hiring." (Nixon Peabody LLP)

[Guidance Overview] Legislation Proposed to Eliminate Employment Taxes on Employer-Provided Cell Phones
Excerpt: "In 1989 Congress amended the Internal Revenue Code (IRC) to include cell phones among 'listed property.'1 Listed property includes items obtained for use in a business but designated by the IRC as lending themselves easily to personal use. Besides cell phones, other 'listed property' includes automobiles, computers, and entertainment or recreation-related items. From an employer's perspective, business use of listed property is treated as a working condition fringe benefit. However, if the employee uses the property for personal use, such use is treated as additional wages and is subject to income tax withholding, FICA and FUTA taxes." (Littler Mendelson P.C.)

Executive Compensation: Is It Too High?
Excerpt: "There are five tools companies generally use in setting executive compensation, points out E-Commerce Times columnist Theodore F. di Stefano: base salary, short-term incentives, long-term incentives, employee benefits and perks." (Ecommerce Times)

Class of 2008 Tuned Into Retirement, Health Benefits That Come with a Job
Excerpt: "A survey by a job site aimed at new college graduates found that the Class of 2008 considers health care coverage and a retirement savings program as very important when evaluating a job offer." (; free registration required)

Employers Broaden Total Rewards
Excerpt: "The economic downturn and increased competition for the best talent are leading companies to adopt a more holistic approach to total rewards. They are going beyond benefits and compensation and incorporating elements such as career planning, performance management, employee training and work-life balance programs, experts say." (Employee Benefit News; free registration required)

Change in Compensation Costs, December 2007-March 2008
Excerpt: "Total compensation costs for civilian workers increased 0.7 percent from December 2007 to March 2008, seasonally adjusted." (U.S. Bureau of Labor Statistics)

A New Benefit Platform for Life Security (PDF)
62 pages. Excerpt: "The benefit security needs of all Americans is a troubling issue of increasing importance to employers and to society as a whole; as these issues began to be raised by our members, The ERISA Industry Committee (ERIC) asked a Task Force drawn from its membership and composed of experienced senior benefit professionals to address this issue. The Task Force's assessment and proposal has been reviewed and endorsed by ERIC's policy committees and its Board." (The ERISA Industry Committee via Human Resource Executive Online)

Newly Posted Events
(Post Yours!)

Form 5500 Reporting Requirements Webcast
Nationwide on May 8, 2008
presented by U.S. Department of Labor, Employee Benefits Security Administration (EBSA)

Form 5500- With a Twist!
in Massachusetts on May 15, 2008
presented by ASPPA Benefits Council (ABC) of New England

Newly Posted Press Releases
(Post Yours!)

ING to Acquire CitiStreet for EUR 578 million (US $900 million); ING Moves to Number Three in Defined Contribution Business
ING Group

MBGH Annual Employer Benefit Survey Reveals Growing Shift to Value-Based Benefit Design
Midwest Business Group on Health

Cancer Remains Top Cause of Unum's Disability Claims; Research Finds Supportive Workplace Can Aid Recovery

Charles Schwab Expands Relationship With Mondrian Investment Partners
Charles Schwab Corporation

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Pension Administrator
for Primark Benefits
in CA

QPA, CPC, QKA, or APA Administrator To Work Remotely
for Plan Design Consultants, Inc.

Senior Retirement Plan Analyst
for Johns Hopkins University Applied Physics Laboratory
in MD

Education Specialist -- Field Presenter
for Charles Schwab & Company

Director Broker Dealer, Custody, Client Services & Operations
for Charles Schwab & Company
in AZ

Retirement Services District Manager
for ADP Retirement Services
in AZ, CA, CO, CT, IN, LA, MD, MI, NM, NY, OH, OK, PA, TN, TX

Lansing MI Home Based Customer Service Representative
for Citi
in MI

Health Insurance Administrator -Non Merit
for Baltimore County Government
in MD

for Buck Consultants
in IL, NJ, NY

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