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April 9, 2012 Get Health & Welfare News  |  Advertise  |  Unsubscribe  |  Past Issues  |  Search

Employee Benefits Jobs

Implementation Partner
for Lincoln Financial Group in ANY STATE, IN

Outsourcing - Defined Benefit Analyst
for The Savitz Organization in PA

Manager, Participant Service Center
for Atessa Benefits, Inc. in CA

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Webcasts and Conferences

"SunGard Relius Form 5500 and 401(k) Plan Workshops" - Appleton
in Wisconsin on May 8, 2012 presented by SunGard Relius

"SunGard Relius Form 5500 and 401(k) Plan Workshops" - Cleveland
in Ohio on May 8, 2012 presented by SunGard Relius

"SunGard Relius Form 5500 and 401(k) Plan Workshops" - Syracuse
in California on May 8, 2012 presented by SunGard Relius

"SunGard Relius Form 5500 and 401(k) Plan Workshops" - Chicago
in Illinois on May 10, 2012 presented by SunGard Relius

"SunGard Relius Form 5500 and 401(k) Plan Workshops" - Denver
in Colorado on May 10, 2012 presented by SunGard Relius

"SunGard Relius Form 5500 and 401(k) Plan Workshops" - Detroit
in Michigan on May 10, 2012 presented by SunGard Relius

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[Guidance Overview]
Structural Impediments to Claims for Breach of Fiduciary Duty (PDF)
"[T]here is no perfect correlation, or even close to perfect correlation, between the ratio of well-run plans to problem plans and the batting average of participants and their lawyers in breach of fiduciary duty suits brought against plans and fiduciaries.... So what accounts for that disjunct? ... I have come to think that it stems from several factors [that] create a structural barrier to the successful prosecution of such claims." (Journal of Pension Benefits, by Stephen D. Rosenberg, Esq.)

DATAIR! New Features Flexible Pricing Module Integration   [Advert.]

Sponsored by DATAIR Employee Benefit Systems, Inc.

Proposals, Testing, Administration, 5500s, 1099Rs, Plan Documents
401(k), New Comparability, 403(b), Non-qualified Plans

[Guidance Overview]
Another Question is Answered in the Who's the Employer Q&A Column
A county government says it owns and controls a county hospital. An IRS letter to the hospital does not say it is qualified under Internal Revenue Code section 501(c)(3), although it says the hospital is an organization described in sections 509(a)(1) and 170(b)(1)(A)(iii). The hospital wants to establish a retirement plan to cover its employees. Can the hospital sponsor a 401(k) plan, or is it considered a "governmental" entity and hence ineligible to sponsor a 401(k) plan? (

Illinois Pension Reform Push Could Hinge on One Sentence in State Constitution
"Article XIII [of the Illinois constitution] says membership in any government worker pension or retirement system 'shall be an enforceable contractual relationship, the benefits of which shall not be diminished or impaired.' Republicans argue that legalese applies only to retirement perks that already have been earned by public employees. They say future benefits can be scaled back without a problem ... Democrats warn that path could be illegal and result in a legal battle with unions that puts the state back at square one after years in court." (Chicago Tribune)

Should You Buy 'Longevity' Insurance?
"In the event of an insurer's insolvency, industry-backed guaranty associations in each state provide at least $100,000 in coverage of projected annuity benefits, with many covering up to $250,000 or more. Go to for links to the association and coverage limit in your state." (The Wall Street Journal)

Study Finds 80 Percent Default Rate on Retirement Plan Loans By Terminated Employees
"A significant finding of the study, from the perspective of plan design, was the higher default rate of participants in plans that authorized multiple loans. While 74 percent of employees with one loan defaulted, 94 percent of employees with multiple loans defaulted." (Wolters Kluwer Law & Business / CCH)

Where to Get Social Security Help
Good article for use in helping employees with financial planning; includes several hypertext links to federal resources. "Many financial advisers have expertise in Social Security rules, including some who once worked at the Social Security Administration. Many are fee-based, like accountants, or provide the help as part of their financial planning or wealth-management practice. There also are some sophisticated online tools that let people crunch their own numbers under various scenarios." (The Wall Street Journal, by Ellen E. Shultz)

Retirement Account Balances, Updated April 2012
"The retirement savings of American households took a big hit when the stock market crashed in 2008. Recently, however, a good portion of these losses has been reversed. This fact sheet follows trends in retirement account balances since the beginning of 2005." (Urban Institute)

Generation Y: What You Need to Know About Financial Literacy
"[Late teens and early 20s:] This may be the time of your life when your earnings are at their lowest, so managing expenses should be a top priority.... [Mid- to late-20s: 401(k) plans] are portable, which is important, since many people in their 20s change jobs and even careers several times. They are also flexible, allowing you to make changes to your investments at any time or even put your contributions on hold if you run into dire financial straits.... [Early 30s:] If you have children whom you hope to put through college, now is a good time to start a college fund for them." (TIAA-CREF)

In Target-Date Funds, a Hodgepodge of Styles
"Assets in these funds have more than quadrupled since 2007. For employees, the funds appear very straightforward, requiring only the choice of an expected retirement date.... [W]hat T.D.F.'s do quite well is distance investors from their worst enemy: themselves. By hewing to a long-term investment allocation strategy and rebalancing whenever the markets throw the portfolio off that strategy, they insulate investors from many emotional and psychological barriers that can make it hard to stick with a given approach." (The New York Times; free registration required)

Measuring a 401(k) Plan's Success: The Income Replacement Ratio
"Sponsors of defined contribution retirement plans often encounter the problem of how to measure the success of their plan in meeting the future needs of their employees. As part of offering a retirement plan, they need a gauge of results.... [A]n important metric used to help determine if a person is on track for adequate retirement savings is the income replacement ratio." (Society for Human Resource Management)

How Delaying Retirement Can Help You
"The major financial benefits of deferring retirement are the ability to continue earning money, adding to your retirement assets, deferring drawing down those assets, and delaying the date you begin to receive Social Security benefits. Situations differ, of course, but here's a rough look at the impact of deferring retirement for five years, from age 65 to 70." (U.S.News & World Report)

How to Hedge 7 Retirement Risks
"Here's how to manage seven of the biggest retirement challenges: Inflation; Healthcare costs; Running out of money; Investment losses; Living longer than expected; Falling home values; [and] Forced retirement." (U.S.News & World Report)

[Guidance Overview]
Governor Quinn, Mayor Emanuel: It's Time to Look at Little Rhody
"[Chicago mayor Rahm Emanuel] described the dishonesty of a pension system fomented by pols who committed taxpayers to dole out more than they can afford to pensioners. If Chicago does nothing, he said, property taxes will have to rise by 150 percent -- a prospect he rejected as unthinkable: 'You won't recruit a business, you won't recruit a family to live here.' ... Emanuel raised, and [llinois governor Pat Quinn] discussed, the best idea of the night: that Illinois consider pension changes that the similarly Democratic state of Rhode Island adopted in November." (Chicago Tribune)

Benefits in General; Executive Compensation

[Guidance Overview]
Emerging Growth Companies Exempted From Certain Compensation-Related Reporting Requirements
"[T]he JOBS Act makes it easier for emerging growth companies to go public by providing them with relief from certain executive compensation reporting requirements otherwise required by the Dodd-Frank Act. This update covers only the executive compensation provisions[.]" (Practical Law Company)

In Chief Executives' Pay, a Rich Game of Thrones
"IS any C.E.O. worth $1 mil.lion a day? That's roughly $42,000 an hour. Or $700 a minute. Or $12 a second.... At Apple, the answer to that question is an emphatic yes, and then some.... [Timothy D. Cook] was paid a cash salary of roughly $900,000 in 2011. On its own, that would have been a ho-hum paycheck for a top American C.E.O. in recent years. But then came a wild extra, a one-time award, in the form of Apple stock. It was initially worth a staggering $376.2 mil.lion. As of the end of last week, it was valued at roughly $634 mil.lion[.]" (The New York Times; free registration required)

Milliman's Monthly Benefit News and Developments, April 2012 (PDF)
Very good summary of recent important legislation, plus a list of regulations and other activity by federal agencies affecting employee benefit plans. (Milliman)

Best Practices for Using the Talent and Experience of Older Workers (PDF)
"A report ... points to wide-ranging flexible workplace options that can retain older workers, tap into the experience of retired workers and help employers fill skills and knowledge gaps. Success is dependent, though, on matching flexibility initiatives with the needs of employers and their older employees." (Sloan Center on Aging & Work at Boston College )

Press Releases

DST and LIMRA Form Strategic Alliance
(DST Retirement Solutions), Inc.
1298 Minnesota Avenue, Suite H
Winter Park, Florida 32789
Phone (407) 644-4146
Fax (407) 644-2151

Jeanette Hull, News Editor
David Rhett Baker, J.D., Editor and Publisher <>
Lois Baker, J.D., President <>
Holly Horton, Business Manager <>

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