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September 9, 2013          Get Health & Welfare News  |  Advertise
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Employee Benefits Jobs

Client Service Representative
Associated Pension Consultants
in CA

Client Service Manager
The Newport Group
in FL, NC, WI

Project Specialist
Heartland Consulting Group, Inc.
in KS

Account Manager - Retirement
MullinTBG, A Prudential Financial company
in CA

Technical Operations Manager
Nationwide Financial
in OH

Conversions Specialist
Verisight, Inc.
in CA

Project Manager
Professional Capital Services
in PA

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Webcasts and Conferences

Countdown to Exchanges: Last-Minute Preparations for the New Marketplaces
September 18, 2013 WEBCAST
(Atlantic Information Services, Inc)

Full Day Seminar with Sal Tripodi
September 17, 2013 in OH
(ASPPA Benefits Council of Cleveland)

Advanced Cross-Tested Plans: Adding More Tools - San Francisco
October 4, 2013 in CA
(SunGard Relius)

SIMPLE Plans
September 17, 2013 WEBCAST
(Ascensus)

72(t) Payments
September 17, 2013 WEBCAST
(Ascensus)

What Every Retirement Plan Professional Should Know About Social Security Benefits and the Social Security System
October 17, 2013 WEBCAST
(American Society of Pension Professionals & Actuaries (ASPPA))

Practical Behavioral Finance Solutions to Improve 401(k) Plans
September 18, 2013 in FL
(ASPPA Benefits Council of Central Florida)

DOMA Decision Details, Directives, and Discussion
September 17, 2013 in CA
(Western Pension & Benefits Council - San Diego Chapter)

Retirement Policy Update from Washington: What Plan Sponsors Need to Know
September 17, 2013 WEBCAST
(Transamerica Retirement Solutions)

The Public Health Insurance Exchanges: What It Means For Employers And Employees
September 26, 2013 WEBCAST
(Mercer)

View All Webcasts and Conferences


  LinkedIn   Twitter   Facebook Hand-picked links to the web's best news articles,
official guidance, jobs, webcasts and more.
[Guidance Overview]

IRS Proposed Regulations Would Require Electronic Filing for Certain Retirement Plan Reporting
"For many employee benefit plans, electronic filing itself would not impose a significant new compliance burden.... Electronic filing would be new, however, for Form 5500-EZ filers (although there may be few whose aggregate filings exceed the 250-return threshold). The most noticeable change for all retirement plan filers would be the addition of Code-specific items to the Form 5500; employers and plan administrators would no doubt welcome more information about what items will potentially be required." (Thomson Reuters / EBIA)  


[Advert.]

DOMA Update Webcast Includes Newly Issued IRS Guidance

Sponsored by ASC

This webcast includes coverage of the highly anticipated IRS guidance confirming that federal tax benefits apply to same-sex couples that reside in a jurisdiction that otherwise would not recognize same-sex marriages. To learn more and register click here.



[Guidance Overview]

ESOP Releveraging
"[R]edemption and subsequent releveraging are solutions to fund required obligations and create new stock allocations. Plan sponsors should be aware of increased scrutiny by governmental agencies with respect to new ESOP transactions. It is probable that the reporting new indebtedness on the annual Form 5500 filing may trigger an audit. In the event of audit it is critical that the required documentation is in place including the updated valuation of the privately held company stock." (Blue Ridge ESOP Associates)  

AT&T Pension Plan Gets Boost
"AT&T Inc. has received tentative approval from the [DOL] to contribute up to $9.5 billion of preferred equity to its pension plan, a move that would bring the plan close to fully funded status.... The preferred stock would comprise about 18% of the assets in AT&T's pension fund.... The telecommunication giant's pension was underfunded by about $13.9 billion at the end of last year." (The Wall Street Journal; subscription may be required)  

Fiduciary Issues for Target Date Funds
"One striking thing about the Department of Labor's Target Date Fund (TDF) tip sheet was how much the 'tips' were simply a re-statement of general fiduciary rules applicable to choosing and monitoring any fund in a 401(k) plan fund menu.... [T]his article [reviews] some of the fiduciary challenges that TDFs present ... in key areas of fiduciary exposure -- fund selection, monitoring and benchmarking, and fees." (October Three)  

Reinventing Retirement Education in the Workplace
"Traditional retirement education in the workplace had relatively simple objectives ... But behavioral economics has shifted the terms of the debate. Autoenrollment and autoescalation on the savings side as well as target-date funds, managed accounts, default options, and reenrollment on the investment side have produced large-scale behavioral change in plans adopting these features. And this change is more rapid and sustained than education typically has been able to deliver." (Vanguard)  


[Advert.]

Growth and Increased Retention Through Plan Transfers & IRA Rollovers

Sponsored by Financial Research Associates, LLC

Join top-level speakers for networking opportunities and in-depth sessions on key topics to boost success in the IRA Rollover and "money in motion" marketplace. October 17-18, Boston -- Mention FMP164 during registration to receive 10% discount.



The World's 300 Largest Pension Funds at Year-End 2012
"Assets under management (AUM) of the world's largest pension funds totalled US$14.0 trillion in 2012. Funds AUM increased by 9.8% in 2012, compared to 1.9% in 2011. The top 20 funds had a growth rate of 8.6% in 2012, a smaller increase than the overall ranking.... In 2012, the European funds experienced higher growth rate than the ones from Asia-Pacific. The US and UK account for half of the funds in the ranking. However, both countries saw 29 of their funds drop from the top 300 since 2007, while only 11 new funds joined from these two countries." (Towers Watson)  

Top Pension Funds Back on Growth Track
"Total assets of the world's largest 300 pension funds grew by almost 10% in 2012 (compared to around 2% in 2011) to reach a new high of US$14.0 trillion (up from US$12.7 trillion in 2011) ... [L]ast year's growth in assets was among the highest recorded in recent years; similar to 2010 (11%) but not the exceptional growth of 14% recorded in 2007." (Towers Watson)  

California Public Pension Payouts Doubled After Bump in Benefits
"The average retirement payout for new retirees in California's biggest public pension system doubled between 1999 and 2012, according to CalPERS data, and initial monthly payments for one group nearly tripled in that period. State and local cops and firefighters benefited the most." (Sacramento Bee)  

CalPERS Seeks Outside Review of Computer System
"This week CalPERS plans to ask for bids from consultants for a review of a project that began in 1995, had an estimated cost of $279 million that more than doubled to $586 million, and finally enabled the unplugging of all old computer systems last June. The review will look at how well the project achieved its goals, the benefits and any lessons learned.... CalSTRS, aiming to learn from history, plans to ask for bids this fall on a major computer system to be completed in six years." (Calpensions)  


[Advert.]

Same-Gender Marriage Rulings: Impacts on Employee Benefit Plans Across the Nation - September 30 Webinar

Sponsored by Lorman and BenefitsLink

This live webinar will provide information needed to administer benefit plans in accordance with applicable laws and will discuss best practices for offering benefits to civil union partners and other same-sex partners. Registration discount for BenefitsLink readers.



Cypen & Cypen Newsletter, September 5, 2013
Article titles include: CalPERS Issues Statement on San Bernardino Bankruptcy Ruling; Treasury and IRS Announce That All Legal Same-sex Marriages Will Be Recognized for Federal Tax Purposes -- Ruling Provides Certainty, Benefits and Protections Under Federal Tax Law for Same-sex Married Couples; and HHS Announces First Guidance Implementing Supreme Court's Decision on the Defense of Marriage Act. (Cypen & Cypen)  

Participants: Keep Your Hand Out of the 401(k) Cookie Jar
"The habits you may develop after taking just one loan could be extremely detrimental to your financial future. Here's how: You'll likely contribute less to your 401(k).... If you leave your employer, you'll probably end up taking a distribution on any outstanding loan balance.... Once you start, you're likely not to stop." (Smart401k)  

Nearly $1 Billion in Bonuses Paid from Ailing Detroit Pension Fund
"One of Detroit's two pension funds handed out nearly $1 billion in bonus cash payments over two decades to retirees and active employees' retirement accounts instead of reinvesting the extra earnings for the future ... The payments, often referred to as a '13th check,' ... [increased] the amount the city needed to contribute each year to keep the pension fund solvent." (Detroit Free Press)  

EU Looking to Impose Capital Buffer on Money-Market Funds
"The [European Union's] plans include requiring funds that maintain a fixed share price to build up a cash buffer equivalent to 3 percent of their assets ... Funds that are already in place before the rules become law would have three years to fully meet the requirement." (Treasury & Risk)  

[Opinion]

Text of Comments by SPARK to OMB on Proposed Information Collection Request about Focus Groups and Survey Regarding Pension Benefit Statements (PDF)
"The Study only considers and asks participants to evaluate the Sample Statements.... [We] are concerned that the Study results will be unreliable due to participants being asked to review certain elements out of their typical context, and that such results will be of limited value for rulemaking purposes ... [We] believe that it is vital to evaluate whether the samples developed by EBSA will result in meaningful improvements, and will be preferred by participants over what is already available, before any new rules mandate a different approach and require substantial compliance costs. We are concerned that the Study, as currently designed, will not accomplish that." (The SPARK Institute)  

[Opinion]

DOL Credits Itself for Notable Evolution in the 401(k) Industry
"The Department of Labor is taking credit for pushing over the first domino in the line that has led to an accelerating revolution in the 401(k) industry that is marked by lower fees, higher-quality advice and greater transparency.... [W]hile plan sponsors can now see how much they're paying, that still isn't solving all of the problems because many employers are completely bewildered about what all of the costs mean." (RIABiz)  

[Opinion]

The $30 Trillion State and Local Government Pension Gap
"What difference does a more 'realistic' forecast make? According to the survey done by Moody's, it makes a difference of more than $3 trillion, or more than double the total actual assets of the 255 largest state-funded pension plans.... Current official reporting suggests that states have funded 73% of their pension liabilities. The fair-market-value approach used by Moody's and GASB suggests that funding is only at 39%. The difference is almost entirely due to the assumptions one uses about the discount rate for future expected returns." (John Mauldin in ValueWalk)  

Benefits in General; Executive Compensation

[Guidance Overview]

Treasury Department Guidance on Same-Sex Spousal Status Requires Employers to Take Immediate Action on Employee Benefit Plans
"Among the unanswered questions which may be addressed in that future guidance may be: What, if any, survivor annuity rights must be provided to the same-sex spouse of a retired employee who commenced pension benefits prior to the September 16, 2013, effective date? ... What, if anything, must a defined contribution plan do if death benefits have been paid to a non-spousal beneficiary without the same-sex spouse's consent?... What about church plans which are exempt from [ERISA]?... How will plans maintained by state governments or their instrumentalities be impacted by the positions outlined in Revenue Ruling 2013-17?" (BakerHostetler)  

Deferred Compensation Arrangements in Employment Agreements Not an ERISA Plan
"Although there was a cap on certain payments, the court held that such provision did not involve enough employer discretion to constitute an administrative scheme, thus ERISA did not apply. The court also noted that the cap would likely never be triggered, no administrative scheme was needed to monitor the company's former employees to ensure compliance with non-compete provisions, and even though the triggering events, including termination without cause and retirement, would occur more than once and at a different time for each employee, they could easily be ascertained without employer discretion." [Cantrell v. Briggs & Veselka Co., No. 12-20294 (5th Cir. Aug. 27, 2013)] (Haynes and Boone, LLP)  

SEC Considers Rule Comparing CEO Pay with Workers
"The rule is a result of the Dodd-Frank Wall Street reforms of 2010. But little progress has been made, partly because the rule lacked a deadline and partly because big companies lobbied against it.... One big hurdle they complain about: Collecting pay data for employees overseas.... But proponents of the plan say companies could virtually ignore overseas employees, due to the way the SEC intends to have companies report median employee pay." (CNNMoney.com)  

Equity Vesting and Managerial Myopia
"[The authors] use recent changes in compensation disclosure to introduce a new empirical measure that is tightly linked to theory -- the sensitivity of equity vesting over the upcoming year.... An interquartile increase is associated with a decline of 0.11% in the growth of R&D (scaled by total assets), 37% of the average R&D growth rate. Similar results hold when including advertising and capital expenditure. Newly-vesting equity increases the likelihood of meeting or beating analyst earnings forecasts by a narrow margin. However, the market's reaction to doing so is lower, suggesting that it recognizes CEOs' myopic incentives." (National Bureau of Economic Research [NBER])  

Option Plays Dwindle in Pay Mix
"With shareholders opposing outsized enrichment for executives, stock options are gradually giving way to restricted stock in compensation packages.... At the 110 'mature' companies studied, stock options accounted for 49 percent of equity shares granted in 2012. That left 51 percent of the shares in the form of restricted stock, which often requires only that the employee stay on the job for a certain length of time in order to be vested in the award." (CFO)  

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