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[Guidance Overview] PBGC Announces November 2008 Interest Rates and Factors
Excerpt: "The PBGC has announced the November 2008 interest rates for valuing benefits of terminating single-employer plans and for valuing benefits and assets under ERISA ?4044 . The interest rate to be used in valuing benefits of single-employer or multiemployer plans for valuation dates on or after November 1, 2008 will be 7.09%, which represents an increase from the October 2008 rate of 6.18%." (Wolters Kluwer)


How Much Do You Need to Retire?
Excerpt: "'Many Americans envision a retirement where their lifestyle continues much as before,' said Tom Neubig of Ernst & Young. 'Our work shows that this is often not a realistic expectation and that, with the current state of savings and potentially very long life expectancies, many retirees will have to cut back far more on expenditures than they expected.' For people who don't want to risk living on 70 percent of their current income, 'the agonizing issue,' said Susan Stewart, president of Charter Financial Group in Bethesda, Md., 'is that many have to save more, spend less and work longer before they retire.'" (AARP)


Argentinean Private Pension Funds to Be Nationalized
Excerpt: "The Argentinean government has moved to nationalize its private pension system, making Pay-As-You-Go the only system that will be available to the public for mandatory contributions. A bill was sent to Parliament on October 21, 2008, and is expected to be approved in November, 2008." (Watson Wyatt Worldwide)


CRS Report for Congress: Retirement Benefits for Members of Congress (PDF)
16 pages; update October 28, 2008. Excerpt: "As of October 1, 2007, 435 retired Members of Congress were receiving federal pensions based fully or in part on their congressional service. Of this number, 286 had retired under CSRS and were receiving an average annual pension of $63,696. A total of 149 Members had retired with service under both CSRS and FERS or with service under FERS only. Their average annual pension was $36,732 in 2007." (Congressional Research Service, U.S. Library of Congress)


Supreme Court Asks for Thoughts on Plan Documents in Retirement Benefits Distribution Case
Excerpt: "The U.S. Supreme Court has asked the parties in a retirement plan case to answer questions about whether the plan should have had to pay out benefits to a participant's ex-wife. The court has issued an order seeking supplemental briefs in connection with Kennedy et al. vs. Plan Adm. For DuPont Savings et al. . . . The briefs are due Nov. 10. Outside groups also can file friend-of-the-court briefs on the topic, and those briefs also are due Nov. 10, the court says." (The National Underwriter Company; free registration or paid subscription required)


Strategies for Pension Plans in the Global Financial Crisis (PDF)
2 pages. (Milliman)


'Flawed' 401(k) Laws Putting Retirement at Risk
Excerpt: "'People mistakenly think they have an employer pension plan and don't understand that their retirement income, other than Social Security, is in very serious jeopardy right now,' said [Law professor Richard L.] Kaplan, who wrote a 2004 article on the risks of 401(k) plans that appeared in the Arizona Law Review. He argues that Congress should rewrite laws to allow 401(k) programs only in concert with defined-benefit pensions, even if it means more companies join the roughly half of U.S. employers that offer no retirement savings plan." (ConsumerAffairs.com Inc.)


Some 401(k) Sponsors Still Fans of Unbundled Services, According to Study
Excerpt: "The defined contribution investment only (DCIO) market composes 12% of all 401(k) plans, or approximately 63,000 plans, according to a Spectrem Group study. The Spectrem research report said unbundled usage is highest among those with plan assets of $50 million to $199 million and that those going the unbundled route are more likely than those bundling to bring in a consultant to advise on their plan decisions. Sponsors of plans with $200 million or more in assets are the least likely to use unbundled purchasing." (planadvisor)


Poll Chronicles Participant Reaction to Economic Turmoil
Excerpt: "A new survey found that participants appear to be responding to the current economic and financial crisis by delaying retirement, saving less, and reallocating their retirement investments. According to a news release by the International Foundation of Employee Benefit Plans (IFEBP), in a recent survey of retirement plan sponsors and trustees, 46% of respondents stated their employees and plan participants are considering a delayed retirement." (PLANSPONSOR.com; free registration required)


ESOP Fables: The Impact of Employee Stock Ownership Plans on Labor Disputes
Excerpt: "The presence of an ESOP is likely to result in a reduced incidence of company strikes, report researchers analyzing data associated with major collective bargaining negotiations from 1970 to 1995. Although the number of holdouts may increase as a result, the overall costs of labor disagreements will be less, they say. The authors also conclude that stockholders of a unionized company adopting an ESOP will experience a larger gain than will stockholders of a non-unionized company adopting an ESOP." (Mercer LLC)


Minority Workers Could Use Boost in Amount Invested
Excerpt: "This year the annual Black Investor Survey conducted by Ariel Investments and Charles Schwab didn't get much attention. When the market is at historic lows, it's hard to get publicity for wagging your finger at African Americans for not investing in their employee retirement plans. It was a challenge to get blacks to invest before the market went crazy, and it's probably harder now with just about everybody and their mama -- black and white -- seeing substantial losses." (The Washington Post; free registration required)


Target Date Funds Are Taking a Closer Look at Where Retirees Will End Up
Excerpt: "Retirement plan providers have started taking steps to make sure that target-date fund investors don't suffer the retirement version of [a vacation debacle where you only have enough money for five days of your seven day vacation]. They're reassessing the design of the all-in-one funds in an attempt to match them to investors' needs. Likewise, they're studying investors' behaviors to look for holes in prevailing theories about how people use their retirement accounts. 'You have to make sure that, first and foremost, you think about the solution you're trying to generate for a retirement plan's participants,' says Anne Lester, a senior portfolio manager with JP Morgan Asset Management who has done extensive research on target-date funds. 'The goal should be to maximize the number of participants who reach their finish line.'" (National Association of Real Estate Investment Trusts)


HR Departments Seeing Sizeable Increase in Calls from Workers
Excerpt: "The current financial climate isn't just keeping those on Wall Street busy. Benefit management departments in recent weeks have been fielding questions and addressing concerns from employees worried about their 401(k)s and other employer-sponsored investment vehicles as the stock market plummeted and continues to show signs of instability." (Financial Week; free registration required)


U.S. Businesses Ask Congress for Relief on Pensions
Excerpt: "Fifteen U.S. business groups have asked legislators to provide relief on a pension plan funding law to help companies avoid having to freeze or end pension plans that may be inadequately funded because of the financial crisis. They want Congress to lower levels at which pension plans must be funded and to clarify whether they could smooth out the market values of pension plan assets over several years in financial reports." (Reuters)


[Opinion] Group Letter of Oct. 27, 2008, to House Ways and Means Committee on Needed Pension Funding Reform (PDF)
3 pages. Excerpt: "On behalf of the thousands of employers that we represent and their millions of employees, the undersigned organizations urge you to consider legislation that would help companies navigate the current economic crisis while minimizing adverse impacts on the pension benefit plans they sponsor." (American Benefits Council)


[Opinion] American Benefits Council Submission for the Record of Hearing on Economic Recovery, Job Creation and Investment in America (PDF)
7 pages. Excerpt: "We urge immediate action to reform defined benefit plan funding requirements in light of the unprecedented market, credit and liquidity crises affecting our economy. Absent action to address the unforeseeable and crippling funding shortfalls and funding obligations pension plan sponsors now confront, millions of employee pension plan participants will face benefit restrictions and freezes and the job losses and business contractions threatening many U.S. employers and workers will only be made worse." (American Benefits Council)


[Opinion] Washington Must Find Ways to Help Companies Keep Their Pension Promises
Excerpt: "More and more companies are falling behind in the investments needed to keep those pension promises, and more and more are considering the option of terminating their pension programs to save money. Congressional action is needed to help preserve employees' pensions by changing rules to allow companies to offer plans that are easier to fund. Otherwise, a grim erosion in traditional plans is likely to accelerate." (The Baltimore Sun)


[Opinion] AARP Urges Supreme Court to Require Participants to Follow Plan Terms in Order to Change Beneficiary Designations
Excerpt: "AARP has filed a 'friend of the court' brief in support of neither party in the Supreme Court case of Kennedy v. Plan Adm'r for DuPont Sav. & Inv. Plan. AARP argues that employee benefit plan documents establish who may be a beneficiary and, here, the executrix of the estate did not meet any of the plan criteria." (AARP)

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Links to Items on Executive Comp, Benefits in General

[Guidance Overview] Executive Compensation Rules for the TARP Capital Program (PDF)
5 pages. Excerpt: "On October 20, 2008, the Department of the Treasury ('Treasury') released an interim final rule describing the executive compensation provisions that will govern all financial institutions that participate in the TARP Capital Program. The provisions generally apply as long as the Treasury holds an equity or debt position, including warrants and the common stock underlying the warrants, in a participating institution." (Powell Goldstein LLP)


[Guidance Overview] Issues to Consider: To Participate in the Treasury's Capital Purchase Program or Not - Implications (PDF)
5 pages. Excerpt: "On October 13, 2008, the nine largest financial institutions in the United States 'volunteered' for the Treasury Department's voluntary capital purchase program ('CPP'). Treasury used half of its initial $250 billion under the Troubled Asset Relief Program ('TARP') to purchase stock in these nine institutions. Now the thousands of other depository institutions and their holding companies in the U.S. need to consider whether to avail themselves of the remaining $125 billion. The fact that the big nine are participating is supposed to assure other institutions (and their nervous customers) that there will be no stigma attached to participating in this program, but other considerations remain." (Pillsbury Winthrop Shaw Pittman LLP)


Despite Cutbacks, Automakers Continue to Offer Subsidized Vehicles for Many Managers
Excerpt: "As Detroit's Big Three shutter factories, slash jobs and trim benefits, one executive perk remains: subsidized cars and trucks for management, often with insurance, maintenance and gasoline included. Bonuses have been frozen, health care co-pays increased and retirement plan contributions curtailed, but until recently, these management lease programs have remained largely untouched." (The Detroit News)


Prevalence of Long-Term and Stock-Based Grant Practices for Executives at 250 Largest Companies, 2008 (PDF)
38 pages. Excerpt: "Key findings from the Frederic W. Cook & Co. 2008 Top 250 report include the following: Stock option usage continues to decline, although options remain the single most common long-term incentive vehicle. Stock options are being replaced primarily by full-value shares that are earned by continued service and achievement of performance contingencies (performance shares). Full-value shares with performance contingencies (performance shares) are now as common as full-value shares that vest by continued service alone (restricted stock). Long-term performance awards (performance shares and performance units) . . . ." (Frederic W. Cook & Co., Inc.)

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Newly Posted Events

Aon Consulting?s 2008 Replacement Ratio Study?
in Colorado on November 11, 2008
presented by Western Pension and Benefits Conference-Denver Chapter

Are you ready for EGTRRA restatements?
Nationwide on November 12, 2008
presented by ftwilliam.com

Learn how to use ftwilliam.com's plan document software
Nationwide on November 11, 2008
presented by ftwilliam.com

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Newly Posted Press Releases

The SPARK Institute Issues New Version Of Best Practices For 403(b) Plans Information Sharing
SPARK Institute

Postponing Retirement: Chief Concern and Growing Employee Reality
International Foundation of Employee Benefit Plans

The Royce Funds Added to CPI Retirement Platform
CPI Qualified Plan Consultants, Inc.

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Newly Posted or Renewed Job Openings
( Post a Job | View All Jobs | RSS Feed )

Senior Pension Processor (TPA/Employee Benefits)
for Zenith Administrators
in CA

DB Implementation Project Manager
for Milliman, Inc.
in TX

Benefits Administrator
for Construction Industry Taft-Hartley Fringe Benefit Fund Office
in CT

Account Executive -- DC Plans
for Retirement Management Services, LLC
in KY

Client Service Partner - DB/DC
for Lincoln Financial Group
in IL, IN

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Handy Links:

• View Today's Active Message Threads
• Using the Web for Employee Benefits Research (hypertext article)
• Employee Benefits Library

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