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March 28, 2013          Get Health & Welfare News  |  Advertise  |  Unsubscribe
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Employee Benefits Jobs

Webcasts and Conferences

Spring Conference San Francisco Chapter of WP&BC
in California on May 2, 2013 presented by Western Pension & Benefits Conference, San Francisco Chapter

Demystifying Fund Revenue Equalization Webinar
Nationwide on April 16, 2013 presented by Transamerica Retirement Services

Third Annual Health Care Privacy and Security Forum
in New York on May 22, 2013 presented by American Conference Institute

"401(k) Plan Workshop 2013: Tax Reform and the 401(k) Plan" - Atlanta
in Georgia on April 19, 2013 presented by SunGard Relius

"401(k) Plan Workshop 2013: Tax Reform and the 401(k) Plan" - New Orleans
in Louisiana on April 19, 2013 presented by SunGard Relius

"401(k) Plan Workshop 2013: Tax Reform and the 401(k) Plan" - New York
in New York on April 19, 2013 presented by SunGard Relius

"401(k) Plan Workshop 2013: Tax Reform and the 401(k) Plan" - Philadelphia
in Pennsylvania on April 24, 2013 presented by SunGard Relius

View All Webcasts and Conferences

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401(k) Participants Who Use In-Plan Advice Have More Positive Retirement Outlooks
"Employees who say they use advisory services offered to them in their 401(k) plan have a distinctly more positive outlook about their future retirement versus those who do not ... Nearly one-fifth (18%) of survey respondents say they engage with an online or in-person advisory service in their 401(k) plan." (MarketWatch.com)


Great Lakes Benefits Conference in Chicago, June 13-14!

Sponsored by ASPPA

The Great Lakes Benefits Conference provides an opportunity to discuss employee benefit issues with colleagues and local, regional and national government representatives from the IRS and DOL.

California Watches As Small City of Pacific Grove Goes After CalPERS
"Officials of [the] tiny California city [of Pacific Grove, population 15,000,] say they believe overbilling by state pension system CalPERS has pushed up municipal debt to unsustainable levels, and they have hired a bankruptcy attorney to explore ways to lower payments to the system." (Reuters)

Ruling on Stockton's Eligibility for Bankruptcy Likely Monday
"A verbal ruling on whether Stockton, California, is eligible for bankruptcy protection will likely come next Monday, a federal judge said on the third and final day of a trial that the U.S. municipal debt market is closely watching. U.S. Bankruptcy Judge Christopher Klein said he would need more time than anticipated to make a ruling over whether Stockton should be allowed to press on with its bankruptcy case[.]" (Reuters)

Quarterly U.S. Census Bureau Summary of the Finances of Selected State and Local Government Employee Retirement Systems (PDF)
"For the 100 largest public-employee retirement systems in the country, cash and security holdings totaled $2,836.0 billion in the fourth quarter of 2012, reaching the highest level in 5 years when they peaked at $2,928.9 billion in the fourth quarter of 2007. Cash and security holdings had a quarter-to-quarter increase of 1.7 percent from $2,789.1 billion last quarter, and a year-to-year increase of 8.6 percent from $2,612.0 billion in the fourth quarter of 2011. Earnings on investments totaled $67.3 billion in the fourth quarter of 2012." (U.S. Census Bureau)

Rethinking Your Retirement Withdrawal Rate
"It's easy to overlook a key principle of retirement planning: it may not matter how much money you retire with if you don't have a carefully thought out withdrawal strategy to see you through retirement.... The '4% rule' is a general rule of thumb, and it may not provide you the retirement income you need over the long term. Its 30-year projection is based largely on the assumption that future portfolio returns will be in line with historical averages. But, if you were to underperform the market, the annual 4% withdrawals may potentially result in a portfolio that is depleted much quicker than expected." (Smart401k.com)

Individuals Miss Out on Savings and Tax Benefits of IRAs
"Despite low participation and awareness of how IRAs work, the study shows people are open to the potential benefits that come with an IRA, with 57 percent of those who did not have an IRA saying they would consider one. This includes almost three-quarters of Gen X (ages 35-44), two-thirds of Gen Y (ages 18-34) and half of late baby boomer (ages 45-54) respondents who currently don't have an IRA." (TIAA-CREF)

Target Date Funds and a '63 Corvette Coupe
"Two funds with the same name from different investment companies are not the same. Plan participants need to check the funds to make sure it is right for them. Plan sponsors need to review the investment policy and the employee population to make informed and prescribed choices on behalf of the participants." (Benefits of HR)

Now Entering the Pension Offset Zone -- A Social Security Nightmare
"If you receive a pension from a federal, state or local government -- including some public school systems -- for work where you did not pay Social Security taxes, your spouse's or widow's or widower's benefits may be reduced or even eliminated. The GPO rule applies only to Social Security benefits as a spouse or survivor.... And don't think you can skirt the GPO rule by electing a lump sum annuity payment of your government pension. Social Security will calculate the reduction as if you chose to get a monthly benefit from your government work." (Investment News)

2013 NAGDCA Defined Contribution Plan Survey Report (PDF)
"As of December 31, 2012, 89 responding governmental 457 plans had assets valued at over $103.3 billion. The state 457 plans with the largest asset bases are New York ($14.1 billion) and Ohio ($9.1 billion). The largest local plans responding to the survey are New York City, NY ($10.4 billion) and the City of Los Angeles, CA ($3.6 billion)." (National Association of Government Defined Contribution Administrators)

Making a 'Backdoor' Roth IRA Contribution
"[If] a taxpayer rolls over a distribution from his or her IRA to an eligible retirement plan ... and the amount rolled over equals only the sum of deductible contributions and earnings on all contributions ... but not any nondeductible contributions, the entire amount rolled over will not be taxed at the time of rollover.... The taxpayer's remaining IRA balance after the rollover should equal its basis, so the taxpayer could immediately withdraw that remaining balance tax free or convert it to a Roth IRA tax free." (Journal of Accountancy)

When Should Clients Start Taking Social Security Benefits?
"[An] individual investor who takes benefits at age 62 must achieve returns of 7% or higher in retirement in order to be better off than someone who delays until age 66, assuming an average life expectancy. In contrast, an investor taking Social Security at 66 would need returns of 4.6% or higher to be better off than someone delaying until age 70." (Financial Planning)

Kentucky Lawmakers Approve Pension Reform Bill
"The Kentucky Legislature passed a comprehensive pension reform bill Tuesday night that will create a cash balance plan for members of the $14 billion Kentucky Retirement Systems hired after Jan. 1, 2014. The House and Senate overwhelmingly passed the bill on the last day of the legislative session as well as a companion bill that provides additional revenue sources aimed at allowing the state to fully fund the actuarially required contribution by fiscal year 2015. The increased cost to fully fund the ARC is estimated at $100 million per year from the general fund," (Pensions & Investments)

Get the Trust of Investors by Making Sure They Know How You Get Paid
"Today, investors are more likely to mistrust rather than trust their advisors, with more than half of investors (55%) saying they fear being ripped off by their advice provider. Only 19% fully trust their advisor, down from 24% in 2010. To build trust, advisors first and foremost need to make sure that customers understand how they and their firms earn money ... Specific fees are much less important than understanding how the whole system of incentives works[.]" (On Wall Street)

Middle-Class Folk Need to Stop Spending Like They Are Rich -- and Start Saving Instead
"With the notable exceptions of core European countries: France, Germany, Sweden, Denmark and Norway, nearly every country's saving rates have been falling [including the United States]. The saving rate went up a bit during the 2008 financial crisis, but it's been falling back to trend since then. Despite the economic uncertainty and retirement need, the average household, in more than half of the 24 largest OECD countries, is saving less than 5% of its income." (Quartz)


California Pension Rate Hike Could Push More Struggling Cities Over the Edge
"CalPERS ... [has] tentatively approved a rate hike of about 50 percent on employers over the next six years ... The proposal would replace a policy that kept rates low during the recession. The problem is that pension liabilities are already a huge burden for cities that haven't even managed to close their own budget gaps since the recession hit." (Rep. Darrell Issa, R-Calif, via The Examiner)


Sausage-Making on Illinois Pension Reform
"[Illinois] Lawmakers gave dozens of reasons to vote against pension changes. But one previously common excuse seems to be neutralized for now: Shifting the cost of teacher retirements to school districts isn't as offensive as it was last fall. Some of the bills legislators are considering would place new teachers into a plan that includes a partial 401(k). The cost would be much more manageable for school districts to absorb." (Chicago Tribune; free registration required)


Memo to CalPERS: Here's Your Passive Investments Study
"In a stunning announcement, CalPERS said it is considering whether the active managers it is using achieve better returns than the index portion of its portfolio.... As [the CalPERS] consultant noted, the majority of the active managers you use underperform their benchmark. It's exceedingly difficult to predict which ones will outperform in the future. Even if you could do so, their outperformance will likely be more than offset by the balance of underperforming actively managed funds in your portfolio. A far better option would be to invest in an all-indexed portfolio." (The Huffington Post)

Benefits in General; Executive Compensation

[Guidance Overview]

New York Refines Limits on Executive Pay at State-Funded Organizations; Effective Date Pushed Back to 2014 (PDF)
"The New York State Department of Health (DOH) and a number of other state departments have recently issued revised regulations that, among other changes, defer the effective date of new restrictions on executive compensation and administrative costs at state-funded not-for-profit and for-profit service providers.... The most noteworthy change is the proposal to further delay the effective date of the new limits until July 1, 2013. As revised, the limits will apply to reporting periods commencing on or after that date. In other words, for organizations that report on a calendar-year basis, the rules become effective January 1, 2014." (Towers Watson)

DOL Updates Delinquent Filer Voluntary Compliance (DFVC) Program, Including New Guidance for Top Hat Plans (PDF)
"Pension plans for a select group of management or highly compensated employees (top-hat plans) are subject to the reporting and disclosure obligations ... that require the annual filing of a Form 5500. However, sponsors of top-hat plans may be exempt from the annual reporting requirements if they file a statement with the DOL. The sponsor of a top-hat plan that did not timely file a statement to request an exemption from the Form 5500 filing requirement may file the applicable notice and statement under the DFVC program in lieu of filing any past due annual reports." (Prudential)

Press Releases

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