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June 18, 2013          Get Health & Welfare News  |  Advertise
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Employee Benefits Jobs

Benefits Compliance Manager
for Employee Benefits Professional Services Firm in GA

Client Relationship Consultant
for Gallagher Retirement Services in NJ

Client Service Representative
for Benetrends, Inc. in PA

Associate Pension Administrator
for Alliance Pension Consultants, LLC in IL

Pension Administrator
for Alliance Pension Consultants, LLC in IL

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Webcasts and Conferences


 

Detroit's Recovery Plan Dips Into Pensions to Keep City Afloat
"A plan to cut pension benefits previously thought sacrosanct for 30,000 workers and retirees may tip Detroit into bankruptcy as Emergency Manager Kevyn Orr negotiates over $17 billion in debt and obligations.... Orr's plan will test retirees' contention that Michigan's constitution protects vested pension benefits. No such shield exists, the state-appointed manager's advisers said ... Detroit missed a $39.7 million payment on debt issued to bolster its pensions that was due June 14, its first failure to repay bondholders." (Bloomberg BusinessWeek)


[Advert.]

2013 Advanced Pension Conference in Chicago – August 28-30

Sponsored by SunGard's Relius Education

New this year: 75% more breakout sessions; deeper registration discounts. Agenda: Tax reform, EPCRS 2013, pre-approved 403(b) plans, E&O coverage, component plans, 457 plans, ERISA recapture accounts, early eligibility and more. 19 CE hours. Register here.


CalPERS Panel Adopts Lower Return Assumptions for Fixed Income
"CalPERS' investment committee on Monday took a major step forward toward the possibility of lowering its expected rate of return to 7.25% from 7.5% when it approved lowering the return assumptions for the pension fund's fixed-income and inflation-linked asset classes. The committee approved a staff recommendation calling for a 174-basis-point drop in fixed-income return expectations from 4.5% and a 305-basis-point drop for inflation-linked investments from the current 6%.... The inflation-linked assets make up $9.8 billion of the total portfolio, or about 4%." (Pensions & Investments)

Why the Complexity of Plan Valuation Argues Against Turning Appraisers into Fiduciaries by Regulatory Pronouncement
"[T]here are so many parties who already bear the title of fiduciary and are therefore legally responsible for the impact on a plan of a deficient appraisal that transforming appraisers into fiduciaries is likely to do little more -- when it comes to plan performance and governance -- than create another party to name as a defendant in ERISA litigation, namely the plan's appraisers. Moving the risk of fiduciary liability for a poor appraisal from the fiduciaries who run the plan -- and selected the appraiser and accepted the appraiser's findings -- to the appraiser itself is unlikely to change the incentives and disincentives that impact the quality of a plan's appraisal[.]" (Boston ERISA Law Blog)

U.S. Target-Date Fund Assets Hit $503B in 2012
"Target-date funds saw 20 percent growth in assets last year as more companies encouraged employees to funnel money into these all-in-one retirement vehicles ... Expense ratios average 0.70 percent, BrightScope said. But that number decreased by 0.02 percentage point in 2012." (Reuters)

Many Higher Education Boomer Faculty Plan to Delay Retirement
"[A recent study] examined the behaviors and attitudes of baby boomer (ages 49-67) faculty members at higher education institutions.... 74 percent of these boomers plan to delay retirement past the age of 65, or never retire at all. When asked the reasons for this delay, they not only cited professional reasons (81 percent), but also economic concerns (69 percent) -- suggesting a need for more financial guidance." (Fidelity)


[Advert.]

14th Annual Hawaii ERISA Seminar

Sponsored by TRI Pension Services

A unique seminar, mixing learning and CE with fun -- ERISA update with a focus on "hot" pension topics and current developments. November 20-22, 2013 -- Outrigger Reef Hotel in Honolulu, Hawaii


Employee Ownership Update for June 17, 2013
By NCEO Director Loren Rogers. Articles include: FASB Indefinitely Defers Disclosure Requirements; Australia to Review Taxation of Stock Options; and Ninth Circuit Holds Moench Presumption Does Not Apply in Amgen Case. (National Center for Employee Ownership)

401(k) Index & Observations: Monthly Details, May 2013
"After reaching a low during the month of April (0.024%), defined contribution plan participants' daily transfer volumes increased significantly in May -- to 0.039% of balances per day ... The trailing 12-month daily average reached 0.027% and the 2013 average through May was at 0.032%. There were nine separate days in May with transfer activity above normal, which is three times as many days that occurred in April." (Aon Hewitt)

The Impact of Interest Rates on the National Retirement Risk Index (PDF)
"The National Retirement Risk Index shows that changes in interest rates have only a modest effect on retirement preparedness for three reasons: Most households have relatively little financial wealth to annuitize. The effect on annuity income is muted, because the principal portion of the annuity payout is unaffected by interest rates. Changes in the annuity income from a reverse mortgage are partly offset by changes in the amount that can be borrowed." (Center for Retirement Research at Boston College)

[Opinion]

The Real Number on Detroit Pensions
"Were you to add these two Detroit plans to the list of 100 public plans ranked based on their official funded ratios in a Milliman report last year the Police and Fire Plan would be in a tie at number 2 (behind only the Washington State Law Enforcement Officer's and Fire Fighters' Plan 1 and 2 at 126%) for the best funded large public plan in the country and the General Plan would tie for number 23 (with CALPERS among others)." (Burypensions)

[Opinion]

Competitive Forces Favor a Fiduciary Standard
"The lure and elegant simplicity of 'fiduciary' represents its true beauty. Those who've practiced its ways embrace its promise with the fervor of a fire and brimstone preacher, for, to truly understand the import of the fiduciary standard, one must have lived the fiduciary standard." (Fiduciary News)

Benefits in General; Executive Compensation

Reinhart Employee Benefits Update, June 2013 (PDF)
Articles include: [DOL] Issues Advance Notice of Proposed Rulemaking on Illustration of Lifetime Benefits; DOL Issues Proposed Amendment to Prohibited Transaction Class Exemption (PTE) 80-2; Seventh Circuit Reaffirms Position in "Stock Drop" Laws; and DOL Issues Model Exchange Notices. (Reinhart Boerner Van Deuren s.c.)

Supreme Court Denies Certiorari in Appeal of Disallowed Insurance Deductions
"The U.S. Supreme Court denied certiorari June 17 to two automobile dealership owners who sought review of a Court of Appeals decision disallowing business expense deductions for contributions to a 'Benistar 419 Plan' that the two men used to acquire life insurance policies on each other so that if one died, the other could buy out the deceased partner's share in the business[.]" [Curcio v. Commissioner, No. 12-1085 (U.S., cert. denied June 17, 2013)] (Bloomberg BNA)

Restricted Stock: Maximizing the Value and Asking the Right Questions
"Most executives do not have a choice in the type of restricted stock they receive. In the more likely scenario where a choice or blend of restricted stock and stock options may be offered, there are three issues to consider: [1] When do you need the money? ... [2] How volatile is the company's stock price? ... [3] How optimistic are you about your company?" (SFG Wealth Planning Services, Inc.)

Press Releases

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