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April 4, 2012 Get Health & Welfare News  |  Advertise  |  Unsubscribe  |  Past Issues  |  Search

Employee Benefits Jobs

Benefit Services Specialist
for Northwestern Benefit Corporation of Georgia in GA

Retirement Plan Administrator
for Rains Plan Group in ANY STATE, WA

Benefits Consultant, Small Group & Mid Market
for Northwestern Benefit Corporation of Georgia in GA

Manager, Retirement & Benefits Call Center
for Insperity in TX

Project Manager, Benefits Administration
for Publix Super Markets, Inc. in FL

Transactions Manager - Retirement Solutions/New Business
for The Guardian Life Insurance Company of America in PA

Retirement Education Specialist
for MassMutual Financial Group in NJ

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Webcasts and Conferences

New Opportunities in the Defined Contribution Investment Only (DCIO) Market
in New York on June 25, 2012 presented by Financial Research Associates

Helping Clients through Plan Design: Rules of Thumb for Seizing Opportunities Webcast
Nationwide on April 24, 2012 presented by National Association of Plan Advisors (NAPA)

Control Groups and Affiliated Service Groups: What Does It All Mean?
in California on April 17, 2012 presented by Western Pension & Benefits Conference - San Diego Chapter


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[Guidance Overview]
Reg Z Doesn't Stop Mortgage Loan Originators from Participating in Tax-Qualified Retirement Plans
"[The Consumer Financial Protection Bureau] advises that the current loan originator compensation rule permits 'employers to contribute to Qualified Plans out of a profit pool derived from loan originations.' To emphasize the point, the CFPB also advises that the rule allows financial institutions to 'make contributions to Qualified Plans for loan originators out of a pool of profits derived from loans originated by employees.'" (Ballard Spahr LLP)


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Form 5500 Filing: The Importance of an Email Address
"5500 preparers and practitioners were not only surprised at how quickly the DOL started using EFAST2 to fulfill its stated purpose but also how the DOL used email to communicate with plan sponsors.... However, use of the filing signer's email address may pose problems if the filing signer does not monitor his/her email regularly, did not use a regular email address to obtain filing signer credentials, or used the preparer signature option and the preparer is no longer engaged with the plan (or maybe no longer in the business)." (SunGard Relius)

The Ten Commandments for a Plan Sponsor's Selection of a Mutual Fund as a 401(k) Investment Option
"While the four steps to a well-documented 401k investment due diligence process just fell in our laps, getting into the nitty-gritty of the first two steps — the identifying the selection and monitoring processes — might prove a tad bit more laborious.... [The authors] trust this represents a Decalogue possessing both credence and compatibility." (Fiduciary News)

Drafting ERISA: What Were They Thinking?
An informative and entertaining video presentation entitled "ERISA: What Were They Thinking?" by three of the principal drafters of ERISA: Frank Cummings, Bob Nagle and Henry Rose. Presented at the Pension Rights Center's recent National Training Conference for the U.S. Administration on Aging's Pension Counseling and Information Program. (Pension Rights Center)

Strong Quarter Boosts U.S. Pension Plan Funding Ratios
"The funded status of U.S. corporate pension plans rebounded to around 80% as of March 31, buoyed by the strongest quarter for U.S. equity markets in more than a decade[.]" (Pensions & Investments)

Women: What You Need to Know About Financial Literacy
"As a woman, you need to assign a high priority to retirement planning, making your best effort to balance it with your other day-to-day and long-term priorities. With employer-paid pension and retiree health benefits being eliminated or scaled back, your retirement security is no longer something you can assume will be taken care of on your behalf. You need to take ownership, planning jointly with your spouse or partner if you have one." (TIAA-CREF)

Baby Boomers: What You Need to Know About Financial Literacy
"[F]or you, retirement is likely to be worlds apart from the old paradigm. Among other new challenges to your retirement security, you're faced with the decline of pension plans, a global economic downturn, an uncertain future for Social Security, rising health care costs and increasing life expectancies." (TIAA-CREF)

Retirement Plans of African-Americans and Hispanics Hit Especially Hard During Tough Economy
"African-American employees took hardship withdrawals more than any other ethnic group. Fully 8.8 percent of African-Americans took hardship withdrawals in 2010, compared to 3.2 percent of Hispanics, 1.7 percent of whites and just 1.2 percent of Asian workers." (MarketWatch)

Deferred Retirement Option Plan Is Good Deal for Employees But Draws Criticism in Jacksonville
"The guaranteed 8.4 percent annual return on investment [is] unusual among large Florida cities ... The DROP payments, experts say, aren't a huge portion of the [city's annual pension] contribution, which has been increasing because of poor investment returns, retroactive changes to benefits and funding decisions made in the past. But the size of the lump-sum payouts, combined with the guaranteed rate of return, creates difficulties." (The Florida Times-Union)

Merrill Lynch Jumps on Fiduciary Bandwagon But Critics See Lingering Conflicts
"Merrill Lynch recently announced that it will permit an elite group of its specialized consulting advisors the opportunity to become designated to provide fiduciary services to clients.... [Some] industry leaders question whether the firm can shed conflicted advice in favor of a strict fiduciary standard.... [O]thers see this as a huge game changer in the 401(k) arena and that RIAs in jeopardy of losing business will now need to step up their game in order to keep retirement accounts." (RIABiz)

Court Says PBGC Owes Interest to US Airways Employees for Delay in Making Pension Payments
"[The U.S. Court of Appeals for the District of Columbia] affirmed a ruling that a 45-day delay [by the Pension Benefit Guaranty Corporation] in making a lump-sum payment from a U.S. Airways pension plan is unreasonable. An analysis U.S. Airways conducted during the 1990s found calculation of a lump-sum payment took, at most, 21 business days[.]" (PLANSPONSOR.com)

More Young Employees Seeking Jobs with Pensions
"A recent Towers Watson survey found that people under 40 are increasingly going to work for and staying with employers that provide better retirement benefits. The proportion of workers under age 40 who consider the retirement program an important factor in accepting their job more than doubled from 28 percent in 2009 to 63 percent in 2011[.]" (U.S. News & World Report)

Computer Modeling Exemption from Fiduciary Status Offers Broker-Dealers Big Opportunity
"A little known Department of Labor regulation has the potential to expand the reach of investment advice, improve its quality and untap a substantial flow of retirement money in motion. So says Lou Harvey, head of the financial services market research firm Dalbar, with respect to ERISA 408(g), an exemption that permits advisors to use a certified computer model for advice delivery and be absolved of any fiduciary liability." (AdvisorOne)

Curtailing Tax Treatment of 401(k)s Could Reduce Balances
"[The Employee Benefit Research Institute's] report is the first to analyze the response of both private-sector 401(k) plan sponsors and participants to a proposed scenario where the current tax treatment of employer and worker pre-tax contributions would be modified such that workers would have to pay federal taxes on these amounts currently, rather than on a deferred basis, and participants would receive an 18 percent government match on all contributions." (ERISA Industry Committee)

Text of MetLife Study on Baby Boomers: 'Transitioning Into Retirement'
"Almost one-half (45%) of 65-year-old Boomers are now fully retired (up from 19% in 2008)." (MetLife Mature Market Institute)

Federal Judge Says Fidelity Made Participants Pay Excessive 401(k) Plan Fees
"[A federal district court in Missouri has ruled that a plan sponsor] violated its fiduciary duties to the plan when it had removed [a Vanguard fund] from the plan, ... replacing it with the Fidelity Freedom Funds, and paying Fidelity an amount that exceeded market costs for plan services in order to subsidize ABB's corporate services. [The judge also] ruled that Fidelity Trust breached its fiduciary duties by failing to distribute float income solely for the interest of the plan [and that] Fidelity Research violated its fiduciary duties when it transferred float income to the plan's investment options instead of the plan." (On Wall Street)

SEC Seeks Comments on Investor Testing for Target Date Retirement Funds
"The Commission [has reopened the comment period for a proposed rule] issued in 2010 intended to enhance the information provided to individuals investing in such funds. That proposed rule would generally require target date retirement funds to more prominently disclose the fund's asset allocation at the target date." (Securities and Exchange Commission)

Is There a Better Way to Regulate Financial Planners?
"The SEC and FINRA have responded to criticism over missing some famous, large-scale frauds by jumping ever harder on advisors who played no role at all in that ugly sequence of mistakes.... The profession needs to take the initiative and create a blueprint for better 21st century regulation." (Financial Planning)

Many Americans Just Not Capable of Managing Their 401(k)s to a Successful Retirement
"Consider the hurdles between every American with a 401(k) and a decent retirement: ... enroll in a plan at your company.... save enough. (Imagine what you think is enough. Then save more.) ... manage your investments intelligently through stock market highs and lows, tending to your portfolio every year ... when you retire, ration your money at just the right rate: not so little that you live uncomfortably but not so much that you run out. The result has been a system that works well for people who know how to use it. For many others, it's better than nothing, but it still may not be enough." (The Washington Post)

DOL Prompts Large Plans About Reporting of Mutual Fund Investment Management Fees
"Several weeks ago the DOL [contacted] over 600 ... plan sponsors requesting that the plan amend its Form 5500 filing to include a Schedule C or provide an explanation as to why the plan did not need to include a Schedule C with its filing. The letter noted that the plan reported investments in mutual funds on the Schedule H, and therefore normally would have investment management fees to report.... This Technical Update will address the mutual fund investment management fee reporting requirements." (SunGard Relius)

FedEx's 401(k) and Misclassification of Employees as Independent Contractors
"[The recent Huffington Post] article is a good read because it contains updates about the various lawsuits FedEx has faced over the years, and the ineffective response from Congress to address this situation.... [Plan language], which was included in many EGTRRA prototype and volume submitter plan documents pre-approved by the IRS, ... may kill any potential recovery for the FedEx drivers for retirement benefits if a court determines that they were improperly classified as independent contractors." (The Pension Protection Act Blog)

Creating a Successful Due Diligence Process for Evaluating Investment Options (PDF)
"Building and monitoring an investment array for a qualified retirement plan is a complex task with numerous difficult decisions.... [T]his paper ... shows employers what to look for in a service provider's due diligence process." (Securian Financial Group)

Pension Funding in United Kingdom Gets Worse as Ours Improves
"Pension fund deficits on either side of the Atlantic are moving in opposite directions despite similar sponsoring employer efforts as economic forces take over ... The largest companies' pension funds in the United States improved their funding ratios over the first quarter of the year, while their counterparts in the United Kingdom slumped in the time[.]" (Asset International)

Benefits in General; Executive Compensation

[Guidance Overview]
EEOC Clarifies 'Reasonable Factors Other Than Age' Standard
"Although the EEOC purports to agree that Title VII's business necessity defense is inapplicable in an ADEA case — and that the RFOA defense is less strict than the business necessity defense — the EEOC's articulation of the above-listed RFOA factors could have the practical effect of requiring employers to meet the more demanding business necessity showing." (Ballard Spahr)

DOL Activity Increasing on Form 5500 Filings (PDF)
"Plan Sponsors are receiving notices regarding 5500 issues on both retirement and health and welfare plans. There is a 10 business day turnaround on requested information[.]" (ERISAdiagnostics)

Contrary to Predictions, Boomers Are Retiring in Droves (PDF)
"The study reports that 59% of the first Boomers to turn 65 are at least partially retired — 45% are completely retired and 14% are retired, but working part-time. Of those still working, 37% say they'll retire in the next year and on average plan to do so by the time they're 68. Half (51%) of those who are retired say they retired earlier than they had expected. Of those who retired early, four-in-ten say they did so for health reasons." (MetLife Mature Market Institute)

Press Releases



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