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November 16, 2010

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It's a whole new world at the 2011 NTSAA Annual Conference, the premier 403(b) and 457 forum for educating producers, providers, agents, broker/dealers, sales and marketing managers, office staff, plan sponsors and other business officials. Register now and join your colleagues in Orlando February 2-5, 2011.

For more information and a brochure, go to

Sponsored by NTSAA

[Guidance Overview]
DOL Addresses Question About Furnishing SPDs to Participants
Excerpt: "In particular, the question was whether SPDs could be furnished by mailing a letter or postcard to all participants to let them know a new SPD is available and they can obtain a free copy by calling a telephone number and requesting one. The question stipulates that all participants have access to a telephone."
(Deloitte via

[Guidance Overview]
Work Plan for 2011 Released by IRS Employee Plans Office
Excerpt: "Its newly announced 2011 Work Plan supports the IRS's larger Strategic Plan, which has two overarching goals, to: (1) improve service to make voluntary compliance easier, and (2) enforce the law to ensure that everyone meets their obligation to pay taxes."
(Deloitte via

[Guidance Overview]
PBGC Sets New Interest Rate Assumptions
Excerpt: "[PBGC] has issued a final rule updating the benefit payments interest assumptions for terminated, single-employer plans for December 2010. . . . In comparison with the interest assumptions in effect for November 2010, these interest assumptions represent an increase of 0.50% in the immediate annuity rate and are otherwise unchanged."

Talk of Tax Cut Extension Fuels IRA Conversions
Excerpt: "If a client converts their traditional IRA to a Roth before the end of this year, they can spread the resulting tax bill over two years rather than paying the full amount at once. This is a nice one-off benefit -- provided tax rates do not rise next year . . . ."

FASB Says Public Companies Need Not Disclose More About Multiemployer Plans in 2010
Excerpt: "Public companies participating in multiemployer pension, retiree medical or other postemployment benefit plans can breathe a sigh of relief: FASB's proposal to greatly expand financial statement disclosures about such plans will not take effect for fiscal years ending after Dec. 15, 2010, as originally scheduled."
(Mercer LLC)

New Study Explains Why the 401k Match Fails to Increase Plan Participation
Excerpt: "[Yale and Harvard researchers suggest] this stunning answer: People will walk right past free money - knowingly! [The researchers] reveal their startling results in their paper '$100 Bills on the Sidewalk: Suboptimal Investment in 401k Plans.'"
(Fiduciary News)

Framing Social Security Reform: Behavioral Responses to Changes in the Full Retirement Age
Excerpt: "We use a US Social Security reform as a quasi-experiment to provide evidence on framing effects in retirement behavior. The reform increased the full retirement age (FRA) from 65 to 66 in two month increments per year of birth for cohorts born from 1938 to 1943. We find strong evidence that the spike in the benefit claiming hazard at 65 moved in lockstep along with the FRA."
(Social Science Research Network)

2010 PBGC Annual Report
Excerpt: "Our financial statements report on the obligations we have assumed to date for broken pension promises. During FY 2010, we paid about $5.6 bil.lion in benefits owed to retirees and their surviving beneficiaries, because their pension plans could not."
(Pension Benefit Guaranty Corporation)

Center for State and Local Government Excellence Maps Out Public Pension Changes
Excerpt: "The group has created an interactive map showing a sample of state and local governments that have negotiated changes in pension plans."

Intergenerational Transfers in the Health and Retirement Study Data (PDF)
37 pages. Excerpt: "Many economic analyses of public policy issues are based upon the life-cycle model of household behavior. The usual formulation omits private intergenerational transfers. This paper considers the possibility of a more sophisticated formulation that includes the latter."
(University of Michigan Retirement Research Center)

Personality, Lifetime Earnings, and Retirement Wealth (PDF)
21 pages. Excerpt: "Studies of adolescents and young adults have shown that schooling impacts economic outcomes beyond its impact on cognitive ability. Research has also shown that the personality trait of conscientiousness predicts health outcomes, academic outcomes, and divorce.'
(University of Michigan Retirement Research Center)

How Financial Literacy and Impatience Shape Retirement Wealth and Investment Behaviors (PDF)
29 pages. Excerpt: "Two competing explanations for why consumers have trouble with financial decisions are gaining momentum. One is that people are financially illiterate since they lack understanding of simple economic concepts and cannot carry out computations such as computing compound interest, which could cause them to make suboptimal financial decisions. A second is that impatience or present-bias might explain suboptimal financial decisions. That is, some people persistently choose immediate gratification instead of taking advantage of larger long-term payoffs."
(University of Michigan Retirement Research Center)

Social Security Retirement Age Would Rise to 69 by 2075 with Reforms Proposed in Draft Plan from President Obama's Deficit Commission
Excerpt: "The draft plan released today by the national deficit commission co-chairs Alan Simpson and Erskine Bowles contains long-term changes to Social Security composed roughly of two-thirds benefits cuts - including a hike in the retirement age - and one-third revenue hikes."
(The Christian Science Monitor)

Industry Group Letter to PBGC Regarding Proposed Regulations on Partial Terminations (PDF)
2 pages. Excerpt: "We believe that the proposed regulations are not consistent with the statute. Under the statute, liability is triggered if 'an employer ceases operations at a facility in any location'. The proposed regulations do not follow the statute, which was clearly intended to be limited to situations where operations at a facility are shut down."
(American Benefits Council)

Why Are Academics Among the Few Americans Who Can Afford to Retire?
Excerpt: "Do you think that you may be one of the few people who have saved enough to support yourself in retirement? The only website I know that helps you figure this out is run by a retired pension actuary, Ken Steiner. Here's a link to his website where you can find out whether you're on track. Go to the 'spending calculator' link below the headline 'Self-insuring your retirement.'"
(, Inc.)

Learn more about the only conference focused on the business aspects of running your TPA company. Held January 15-17, 2011 at the Sanctuary on Camelback Mountain in Scottsdale, Arizona, NIPA's 2011 Business Management Conference (BMC) specifically addresses the unique needs of TPA business owners and executives by providing top-notch education to help grow your business and increase efficiencies. For complete details, visit and download a copy of the advance program. Register by December 17 and save $100!
Sponsored by NIPA

Benefits in General; Executive Compensation

'Top 10' Year-End Tax Planning Strategies in Light of 2010 Tax Legislation
Excerpt: "[I]n addition to implementing tax law changes taking effect in 2011, corporate tax executives must begin making contingency arrangements in the event that items such as the Bush tax cuts and the so-called 'extenders' package are not addressed before the end of the year. Given the dynamic and uncertain legislative environment, [we provide] recommendations as to the 'Top 10' year-end tax planning strategies that corporate tax executives should be considering."
(Miller & Chevalier Chartered)

Executive Perquisites Still Continue As Regular Fixture in Many HR Executive Pay Packages
Excerpt: "Increased public scrutiny has probably contributed to the leveling off of executive perquisites, but a recent analysis shows that two-thirds of HR executives receive some form of perk. The larger the company, the more likely HR leaders would receive perks, although there were industry differences."
(Human Resource Executive Online)

Maryland Commission Studying Pension and Retiree Benefits Plans Public Hearing
Excerpt: "Maryland currently has an estimated $33 bil.lion in unfunded liabilities for benefits it has promised to pay over the next three decades -- $18 bil.lion for pensions and $15 bil.lion for retiree health insurance."

Job Perks Begin to Reappear in Workplaces
Excerpt: "Renewable energy company Covanta Energy, for instance, will revive the holiday luncheon that it tabled last year for workers at its Fairfield, N.J., headquarters. And folks at Domino's Pizza will be eligible for bigger bonuses this year."

National Commission on Fiscal Responsibility and Reform Co-Chairs' Proposal [11/10/2010 Draft Document] (PDF)
50 pages. Excerpt: "Our plan makes five basic recommendations: 1. Enact tough discretionary spending caps and provide $200 bil.lion in illustrative domestic and defense savings in 2015. 2. Pass tax reform that dramatically reduces rates, simplifies the code, broadens the base, and reduces the deficit. 3. Address the 'Doc Fix' not through deficit spending but through savings from payment reforms, cost-sharing, and malpractice reform, and long-term measures to control health care cost growth. 4. Achieve mandatory savings from farm subsidies, military and civil service retirement. 5. Ensure Social Security solvency for the next 75 years while reducing poverty among seniors."
(National Commission on Fiscal Responsibility and Reform)

$200 Bil.lion in Illustrative Savings (Draft Document Updated 11/12/2010) (PDF)
24 pages. Illustrated FY 2015 Savings are Domestic: $100.2 Billion, Defense: $100.1 Billion with a Total: $200.3 Billion.
(National Commission on Fiscal Responsibility and Reform)

The President's Advisory Council on Financial Capability Will Hold First Meeting November 30, 2010
Registration closes on Nov. 23, 2010 or when it reaches capacity. Go to the target page for further details.
(President's Advisory Council on Financial Capability)

Bringing Canines to Work Is a Doggone Good Idea, Experts Say
Excerpt: "Dogs can foster greater employee trust and collaboration in the workplace, researchers at Central Michigan University say."
(Chicago Tribune)

More Companies Launching Workplace Banking Programs
Excerpt: "Local banks are reporting a resurgence in the popularity of workplace banking programs, as companies look for low-cost measures to beef up benefits in a constrained economic environment. These programs typically offer employees free or discounted financial services, while providing banks a source of new customers."
(The Washington Post; free registration required)

Aging Workers, Be Wary of Discrimination
Excerpt: "New evidence linking aging workers to the prevalence of Alzheimer's disease is scary on two fronts. First, it ties declining job performance with common symptoms of the dementia that now affects 5 mil.lion Americans. By 2040, that number is expected to quadruple."

Employee Ownership Update for November 15, 2010
NCEO Executive Director Corey Rosen discusses the following: A district court ruled the purchase of unregistered shares for the Tribune ESOP was a prohibited transaction. There are no COLA changes for defined contribution plans in 2011. There is a new site for nonqualified deferred compensation plans. Penmac Staffing is now one of the largest employee-owned companies. The failure to include amounts from option and ESPP exercises is causing errors in calculating compensation in 401(k) plans.
(The National Center for Employee Ownership)

Webcasts and Conferences

5500 System Webcast
Nationwide on November 18, 2010
presented by ASC (Actuarial Systems Corporation)

Press Releases

Amendment to Regulation on “Grandfathered” Health Plans under the Affordable Care Act
U.S. Department of Labor, Employee Benefits Security Administration (EBSA)

How Many of the U.S. Nonelderly Population Have Health Insurance?
Employee Benefit Research Institute (EBRI)

Exchange Traded Funds Added to CPI Retirement Platform
CPI Qualified Plan Consultants, Inc.

Newly Posted Employee Benefits Jobs

Benefits Administrator-Retirement
for Republic Services, Inc.
in AZ

Associate Attorney
for Drinker Biddle & Reath LLP

Benefits Specialist
for Landmark Aviation
in TX

Where the best employers find the best candidates!

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