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BenefitsLink Retirement Plans Newsletter
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[Guidance Overview]
Year-End Checklist for Retirement Plans
Year-end action items that need to be completed by plan sponsors with regard to their retirement plans include Updated Plan Document, RMD Required Amendment, and Notices.
(Miller, Johnson, Snell & Cummiskey, P.L.C.)
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Get answers to your toughest questions at NIPA’s 2012BMC [Advert.]
There is no better way to get answers than to join TPA owners at NIPA’s 2012 Business Management Conference. Held Jan. 14-16, NIPA's 2012BMC addresses the unique needs of TPA owners by providing top-notch education and networking with peers.
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[Guidance Overview]
IRS Simplification of Process for Establishing Which Determination Letter Applications Exempt from User Fees
"These requirements apply to all determination letter applications that are filed with the IRS after Jan. 31, 2011, except for applications filed by April 30, 2012 for Economic Growth and Tax Relief Reconciliation Act of 2001 (EGTRRA) determination letters for defined benefit plans that are eligible for the six-year EGTRRA remedial amendment cycle ending on April 30, 2012. These later applications fall under the purview of IRS Notice 2003-49, according to the IRS."
(Wolters Kluwer Law & Business / CCH)
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[Guidance Overview]
IRS Clarifies User Fee Exemption for Certain Plans
"Acknowledging the difficulty in applying the 5-year eligibility test under Code § 7528(b), which exempts certain small employers from the determination letter user fees, the IRS published a simplifying rule in Notice 2011-86 by which plans can determine their eligibility."
(Deloitte via BenefitsLink.com)
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[Guidance Overview]
DOL Finalizes 'Investment Education' Regulation
"According to a Fact Sheet released by the Labor Department, an estimated 16,000 investment advisory firms are expected to provide investment advice pursuant to the exemption, and approximately 134,000 defined contribution plans covering 17 mil.lion participants and beneficiaries will offer investment advice pursuant to the exemption with approximately 3.5 mil.lion of those participants and beneficiaries seeking the investment advice."
(Deloitte via BenefitsLink.com)
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[Guidance Overview]
DOL's Investment Advice Final Rule Implementing PPA Statutory Exemption
"The exemption permits advisers to receive fees from the investment providers of products that are recommended to plan participants, according to a DOL fact sheet about the new final rule. However, the rule includes 'safeguards and conditions' aimed at preventing skewed investment advice toward investments that pay higher fees to advisers, Phyllis C. Borzi, assistant secretary of labor for EBSA, said . . . ."
(The Bureau of National Affairs, Inc.)
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[Guidance Overview]
DOL Issues Final Regs on Eligible Investment Advice Arrangements
"It is worth noting certain changes requested by commenters that the DOL did not make in the final regulations—for example, some questioned the requirement that detailed information be requested from participants using the computer model; others requested additional guidance on the credentials required for those who will certify computer models or perform the annual audits of investment advice arrangements."
(Thomson Reuters/EBIA)
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Behavioral and Psychological Aspects of the Retirement Decision (PDF)
"The majority of research dealing with the retirement decision has focused on the health and wealth aspects of retirement. Research in the areas of judgment and decision making and behavioral economics suggests that there may be a number of behavioral factors that influence the retirement decision as well."
(U.S. Social Security Administration)
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Caregiver Credits in France, Germany, and Sweden: Lessons for the United States (PDF)
"Analysts have long considered caregiver credits, or pension credits, provided to individuals for time spent out of the workforce caring for dependent children and sick or elderly relatives, as a way to improve the adequacy of retirement benefits for women in the United States. This article examines the experiences of France, Germany, and Sweden with caregiver credits, focusing particularly on the design, administration, and cost of these programs."
(U.S. Social Security Administration)
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How Much to Save for a Secure Retirement (PDF)
"People clearly need less than their full pre-retirement earnings to maintain their standard of living once they stop working. First, they pay less in taxes. They no longer pay Social Security and Medicare payroll taxes, and they pay lower federal income taxes because—at most—only a portion of their Social Security benefits are taxable."
(Center for Retirement Research at Boston College)
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Variety of Motives Cited Why Plan Participants Are Reluctant to Trade Investments
"Participant behavior has been consistent. Only 2% of Vanguard DC plan participants executed a trade among investment options through the first eight trading days of August despite extreme market volatility, according to recent Vanguard research. And in October 2008, the worst month of the last recession, 4% of participants made a trade."
(The Vanguard Group, Inc.)
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The Future of Retirement: Why Family Matters (PDF)
"In this report, we look at some important differences in how people plan for retirement within different types of households. In particular, we examine the gender gap between how men and women plan for their retirement and how that gap might be influenced by the onset of children and differences in working patterns."
(HSBC Insurance Holdings Limited 2011)
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70% of Pensions Are Never Audited
"[The Inspector General of DOL] earlier this year in his Semiannual Report to Congress wrote that plans lacking full audits 'provide no substantive assurance of asset integrity to plan participants.'"
(Forbes.com LLC)
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The Composition and Draw-down of Wealth in Retirement
"This paper presents evidence on the resources available to households as they enter retirement. It draws heavily on data collected by the Health and Retirement Study and calculates the 'potential additional annuity income' that households could purchase, given their holdings of non-annuitized financial assets at the start of retirement."
(National Bureau of Economic Research; paid subscription or individual purchase required to retrieve fulltext)
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[Opinion]
Why Does Social Security Confuse Reporters So Much?
"Dean Baker, Paul Krugman, and Merrill Goozner explain the ways in which The Washington Post's big Sunday story about Social Security is overly alarmist and perpetuates widespread misperceptions."
(The Century Foundation)
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[Opinion]
Employee Stock Ownership Plan Eases Retirement Insecurities
"More than 50 percent of working Americans do not have any employer-sponsored retirement savings plan—no doubt a factor contributing to . . . recent survey results. But all employee owners at S corporation ESOPs do have a plan, and that plan is wholly funded by their companies. Additionally, research has shown that 80 percent of these companies offer their workers more than one qualified retirement plan."
(The Kansas City Star)
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Benefits in General; Executive Compensation
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[Guidance Overview]
Executive Remuneration Perspective: Global Perspective on Say on Pay
"With say-on-pay requirements now applicable to most US public companies, this Perspective includes a look at shareholder vote results in the US and elsewhere, and how say-on-pay laws differ across jurisdictions. It also provides explicit recommendations to improve chances of favorable say-on-pay outcomes."
(Mercer LLC)
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Employee Ownership Update for November 1, 2011
NCEO Executive Director Loren Rodgers discusses the NCEO's new survey of equity compensation in private companies, Mitt Romney and ESOPs, new research on ESOP trends, and more.
(National Center for Employee Ownership)
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Press Releases
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Holly Horton, Business Manager
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