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January 3, 2014          Get Health & Welfare News  |  Advertise
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Employee Benefits Jobs

401(k) Administrator
BPC, Inc
in IL

Sr. Retirement Plan Administrator
PPS, Inc.
in CA

Account Manager
Lincoln Financial Group
in ANY STATE

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Webcasts and Conferences

Mergers & Acquisitions Boot Camp
January 16, 2014 in PA
(PEBA (Penjerdel Employee Benefits and Compensation Association))

Retirement Plan Best Practices: What Every Fiduciary Should Know
January 29, 2014 in CA
(Americh Massena)

Executive Summit on On-Site Employee Health Clinics
March 11, 2014 in FL
(World Congress)

View All Webcasts and Conferences


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official guidance, jobs, webcasts and more.
[Guidance Overview]

Deadline for Depositing Partners' Elective Deferrals
"The Preamble to the regulations indicates that it does not apply a different rule regarding the timing of deposits for elective deferrals to partners. However, the Preamble to the regulations does clarify that a partner's elective deferrals become plan assets 'at the earliest date they can reasonably be segregated from the partnership's general assets after those monies would otherwise have been distributed to the partner, but no later than 15 business days after the month in which those monies would, but for the election, have been distributed to the partner.' Accordingly, the benchmark for determining when a partner's elective deferrals need to be deposited is the date on which partner's earned income is distributed." (SunGard Relius)  


[Advert.]

Learn how to diversify and add return to your portfolio - February 11, NYC

Sponsored by Pensions & Investments

Experts and plan sponsors will present an up-close look at DC plans which have had success with alternative investments, and show how these investments may help add return to your portfolio. Learn about the various attributes alternatives can add.



Fee Benchmarking Should Be a Priority in the Wake of 401(k) Plan Fee Litigation
"A service provider's fee disclosure, standing alone, does not necessarily give the plan fiduciary adequate information to assess whether a fee is reasonable.... Fiduciaries should periodically solicit and review bids from at least three service providers to obtain fee and expense data and/or hire an independent consultant to conduct the search and make related recommendations." (Winston & Strawn LLP)  

The Role of Behavioral Finance in the Development and Evolution of Target Date Funds: How To Maximize Participant Outcomes
"[P]lan sponsors and regulators began to understand that behavioral finance concepts influenced participant behavior that auto enrollment, qualified default investment alternatives, and target date funds began to gain traction in defined contribution plans.... While many target date fund managers, consultants, and plan sponsors are focused on detailed specifics about the glide path (e.g., debating the merits of 'to' versus 'through' glide paths, landing points, etc.) and adding increasingly complex specialty asset class exposure to their mix, ... the best way to help participants meet their retirement goals is to elevate the importance of saving." (Manning & Napier)  

2013 the Best Year on Record for U.S. Pension Gains
"Funding levels of pension plans sponsored by S&P 1500 companies continued their run in 2013, with a further 2% improvement in December, resulting in a funded ratio (assets divided by liabilities) of 95% at the end of the month, up 21% for the year. Over 80% of pension underfunding has been eliminated since the beginning of the year. The collective deficit of $103 billion as of December 31, 2013, is down $454 billion from the estimated deficit of $557 billion as of December 31, 2012." (Mercer)  

Funded Status of Plans Continues Upward in Fourth Quarter 2013
"During the fourth quarter of 2013, ... the funding ratio of the typical corporate US pension plan [rose] by about three percentage points to 95%. Overall, 2013 was a very strong year for corporate pension plans, as we estimate that the average funding ratio rose by about 17 percentage points. Strong investment returns of 4.7% were the main contributor to the improvement in the funding ratio during the quarter. Liability values are estimated to have increased by 1.1%." (UBS via BusinessWire)  

Three Modest Proposals for Improving the 401(k)
"Now that the shift from pensions to 401(k)s is nearly complete, and now that baby boomers are starting to retire -- 10,000 will turn 65 every day for the next 17 years -- and especially because they are retiring just a few years after many saw their portfolios fall precipitously, the deficiencies of the 401(k) are becoming readily apparent." (Forbes)  

Proposed Legislation Would Restore COLAs for Military Retirees
"House Oversight and Government Reform Committee Chairman Darrell Issa (R-Calif.) announced the introduction of legislation to allow the U.S. Postal Service to implement a modified six-day delivery schedule and repeal reductions in military pensions made by the Bipartisan Budget Act of 2013. The military pension cuts were made to achieve $6.2 billion in savings over 10 years. 'This legislation will restore Cost-of-Living Adjustments for our military retirees and not only replace the savings but nearly triple them -- saving $17 billion over 10 years according to conservative USPS estimates,' said Chairman Issa." (Committee on Oversight and Government Reform, U.S. House of Representatives)  

FINRA's Proposed Monitoring System Could Cost Industry Millions
"An automated data collection system that would allow Finra to improve its monitoring of brokerage firm customer accounts would require new and potentially costly coordination between brokers and clearinghouses ... [A]ccount information, such as investor profiles and investment objectives, may be maintained in different ways by individual brokerages and clearinghouses. Making the process uniform would require either the brokers to standardize their profiles or the clearinghouses to set up data protocols that are adopted by the industry[.]" (InvestmentNews)  

Retirement Saving Strategies for Business Owners
"[O]nly 14 percent of entrepreneurs expect to fund their retirement by selling their company ... Most of the entrepreneurs surveyed (59 percent) think they will achieve most of their retirement income goals by saving current earnings. Yet they don't put their retirement money where their mouths are: Only 33 percent have individual retirement accounts ... while 32 percent have Roth IRAs and 13 percent have simplified employee pension IRAs. Unfortunately, 40 percent of entrepreneurs surveyed don't save at all." (U.S.News & World Report via Yahoo News)  

Employee Ownership Update for January 2, 2014
Topics include: [1] DOL sues ESOP trustee, alleging overpayment for shares; [2] New study on trends on M&A, private equity activity; and [3] Proposed definition of fiduciary expected in August. (National Center for Employee Ownership [NCEO])  

[Opinion]

Why Is Our 401(k) Industry on the Defensive?
"[M]ost of us have for a very long time been telling Americans that they should save more. That was and still is true. But in addition to our intended audience, among those who have been listening are members of the media, and academics in think tanks and ivory towers.... We will address here some of the common themes of criticism of the retirement plans currently available to the American worker, and comment on the job that they are doing to prepare Americans for retirement.... [T]he numbers we see tell a glass-half-full, rather than a glass-half-empty story." (Todd Berghuis for Ascensus)  

[Opinion]

A Closer Look at the MassMutual Case's Allegations of Self-Dealing
"The contention made by MassMutual (or any other insurance company) that the spread revenue it retains is simply profit may (or may not) have merit. In any event, it would seem that such vast amounts of money flowing directly into a service provider's coffers should be clearly disclosed to plan fiduciaries. (Presumably, this disclosure was made to fiduciaries at MassMutual.) ... Aside from whether or not any fees were disclosed by MassMutual, the amount of such charges, if proven to be correct, takes one aback somewhat considering that this case involves MassMutual's defined contribution plan for its very own employees." (W. Scott Simon for Morningstar Advisor)  

Benefits in General; Executive Compensation

Top Hat Plan Litigation: Beyond the Select Group Analysis (PDF)
"[M]any courts have struggled with whether nonqualified deferred compensation plans qualify as 'top hat plans' exempt from the bulk of substantive ERISA requirements. Generally, these cases have focused on whether a plan meets the ERISA definition of a top hat plan, meaning it covers a sufficiently 'select group of management or highly compensated employees.' In recent years, there has also been significant growth in litigation over other issues with respect to these plans, including both procedural and substantive issues." (Groom Law Group, via Bloomberg BNA Pension & Benefits Daily)  

2013 Say on Pay Voting Results
"3,363 companies held Say on Pay votes in 2013. 73 companies have failed with an average 60% 'Against' vote. Two additional company received less than 50% 'For' but considered the vote a win because 'For' votes outnumbered 'Against' votes due to abstentions ... 71% of companies have received a greater than 90% 'For' vote." (Steven Hall & Partners)  

Farewell, Intrinsic Value, We Hardly Knew Ye
"To date, there's no consensus about whether earned pay or realizable pay is the better measure. The definition of earned pay is generally accepted as: earned cash bonus/incentives plus shares vesting plus option exercise gains during the period being assessed.... There are two primary differences between the prevailing definitions of realizable pay. One is whether to include retirement and other benefits. The other is whether to consider the intrinsic or fair value of outstanding options." (Towers Watson)  

Press Releases

Enforcement Co-Director George Canellos to Leave SEC
Securities and Exchange Commission

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