Digest
Facing Inadequate Nest Eggs - Summary: The conventional thinking about America's current retirement picture is that affluent Americans will be fine, but the authors suggest that a six-figure nest egg isn't a windfall to be enjoyed by affluent Americans; it should be the minimum goal for all but the poorest.
Located at: Retirement Solutions (PDF File). Click on headline for full article.
Rethinking the Company Match - Summary: Recent research from Harvard and Yale universities outlines potential reasons that companies may want to rethink offering a 401k match.
Located at: Workforce Management (free registration may be required). Click on headline for full article.
Vanguard Economist on the U.S. Outlook for 2008 - Summary: In two multimedia presentations—an 8½-minute video and an audiocast—Joseph Davis, Ph.D., a principal and economist for Vanguard's Investment Counseling & Research and Fixed Income Groups, takes a hard look at what may be in store for the U.S. economy in 2008.
Located at: Vanguard. Click on headline for full article.
Pre-Tax Rollovers to Roth IRAs - Summary: Beginning January 1, 2008, a plan participant may roll over directly from an “eligible retirement plan” account to a Roth IRA, subject to the existing limitation on Roth IRA rollovers.
Located at: Sungard/Relius. Click on headline for full article.
Plan Cannot Limit EACAs to New Participants - Summary: Many practitioners have asked whether an existing 401k can be an eligible automatic contribution arrangement (EACA) if the automatic contributions are limited to participants who enter the plan after the date the employer adds the EACA feature. Based on the proposed automatic enrollment regulations, the answer appears to be "No."
Located at: Sungard/Relius. Click on headline for full article.
Investments That Qualify Under the Final QDIA Regulation - Summary: This article focuses on the types of investments that qualify as QDIAs and is in a Q&A format.
Located at: Reish Luftman Reicher & Cohen (PDF File). Click on headline for full article.
Automatic 401k Enrollment Can Yield Significant Returns - Summary: More than three-fourths of employers now offer a premixed portfolio option, up from 63 percent in 2005. For most workers, this investment strategy is more suitable than the more-conservative default investments used in the past.
Located at: Deseret News. Click on headline for full article.
401k Plans Still Gorged with Company Stock - Summary: After thousands of employees at now-defunct corporations such as Enron and WorldCom saw their retirement savings wiped out early in this decade, things were going to be different. But efforts to wean employees from in-house shares have gone begging.
Located at: Financial Week. Click on headline for full article.
Legislative Items
Legislative and Regulatory Year in Review and the Outlook for 2008 - Summary: This comprehensive report rounds up key legislation and regulatory guidance enacted in 2007 and forecasts the outlook for legislative and regulatory activity in 2008.
Located at: Hewitt. Click on headline for full article.
CFDD Legislative Update - Summary: Written by Kathryn Capage, AIM Investments, this is a chart of retirement legislation that are actively being considered by Congress at this time.
Located at: Center for Due Diligence (PDF File). Click on headline for full article.
Much Talk, Little Action During 2007 Legislative Session - Summary: During 2007, lawmakers evinced a continuing desire to enact legislation that would affect employer-sponsored health, retirement and compensation programs – yet very little of that legislation passed. The year also marked the emergence of new issues that would affect plan investments.
Located at: Watson Wyatt Worldwide. Click on headline for full article.
Commentary
Plan Sponsors Are Avoiding a Safe Harbor - Summary: Author suggests that, "Despite the temptation, a decision to forgo the EIAA and the attendant fiduciary audit won't help a plan meet its responsibilities — just as closing your eyes won't make you look better in front of the mirror. The safe harbor provides a disciplined means of reaching a necessary end, which is prudent management of plan assets for the exclusive benefit of participants and beneficiaries."
Located at: Investmentnews.com (free registration may be required). Click on headline for full article.
Early Retirement Is More Than Just a Pipe Dream - Summary: Longevity is a blessing and a curse for future retirees. Living longer costs more. What was once inconceivable -- four decades in retirement -- is now possible with exercise, better diet and medical advances.
Located at: Bloomberg.com. Click on headline for full article.
DOL and IRS Items
Form 5500 in Transition - Summary: Highlights of the final rules affecting the 2007 and 2008 plan years and transition dates.
Located at: Watson Wyatt Worldwide. Click on headline for full article.
Upcoming Audio Conferences
McKay Hochman: Overview of Types of Plans, Documents & Guidance
Start here to build the foundation of information necessary to understand qualified retirement plans. McKay Hochman covers all the basics in this first module of the year, including the need for retirement income, a chart of every retirement plan available in the U.S., the Internal Revenue Code, and much more. February 27, 2008. For more information, click here.
McKay Hochman: Eligibility and Participation
This audio conference will provide you with all the basics, starting with the statutory ERISA requirements and how to apply them. Conference will address different methods of determining eligibility such as Elapsed Time or Hour of Service. We'll also clarify, with examples, the eligibility rules for rehires – typically the most challenging of the eligibility rules, and an example of the coverage ratio test. March 19, 2008. For more information, click here.
McKay Hochman: Vesting, DC Contributions, Allocations
Vesting is a non-forfeitable right to an employer contribution and you'll benefit knowing the ins and outs of how it works. You'll come away from having attended this module knowing the vesting basics including benefits, schedules, service requirements, break-in-service rules and more. Examples of employer and employee contributions to a plan will be used to give a full picture of what is out there. March 26, 2008. For more information, click here.
McKay Hochman: Top Heavy Rules, Keys, Attribution, HCEs
This audio conference will address a number of concepts, beginning with the definition of HCEs and the family attribution rules and ending with an in-depth overview of the top heavy rules. Conference will also discuss that the IRS does not permit a plan to discriminate in favor of the HCEs – but it doesn’t stop there. April 2, 2008. For more information, click here.
McKay Hochman: Controlled Groups, 415 Limits, Deductions
When completing an adoption agreement, it is important to know if the employer is part of a controlled group. Join us to learn the basics of control groups. When dealing with qualified plans, you’ll also need to know the annual limitations for participants, the employer deduction rules and the ERISA protection from creditor rules. April 9, 2008. For more information, click here.
McKay Hochman: Plan Reporting and Disclosure
This audio conference will focus on plan reporting and disclosure. After this session, you will be familiar with key points to know about Form 5500 and you will understand the scope and significance of ERISA-required disclosures to participants and beneficiaries. April 16, 2008. For more information, click here.
