BPP401k.com Newsletter Benefit Plans Plus 12 17 08

BPP401k.com Newsletter
December 17, 2008

News Highlights

Prepare now for the extened 403(b) deadline with our 403(b) Action Plan Workbook

IRS Extends 403(b) Deadline 403(b) Written Plan Document Not Required by End of 2008; Prototype, Determination Letter Programs Coming "The Service will not treat a § 403(b) plan as failing to satisfy the requirements of § 403(b) and the final regulations during the 2009 calendar year, provided that: (1) on or before December 31, 2009, the sponsor of the plan has adopted a written § 403(b) plan that is intended to satisfy the requirements of § 403(b) (including the final regulations) effective as of January 1, 2009; (2) during 2009, the sponsor operates the plan in accordance with a reasonable interpretation of § 403(b), taking into account the final regulations; and (3) before the end of 2009, the sponsor makes its best efforts to retroactively correct any operational failure during the 2009 calendar year to conform to the terms of the written § 403(b) plan, with such correction to be based on the general principles of correction set forth in the Service's Employee Plans Compliance Resolution System (EPCRS) ..." SOURCE: Internal Revenue Service For PDF Click Here

Schwab Releases Summary of Recent 401k Plan Participant Behavior Schwab recently released information about retirement plan participant behavior to help employers better understand how their employees are approaching their 401k plans in the current market and economic environment.

Chaos Theory A practical explanation of the credit crisis -- how we ended up in the current economic situation and where we can go from here.

How Gender, Age Affect Retirement Plan Participation How do gender and age affect the likelihood that you will participate in a retirement plan?

Schwab Releases Summary of Recent 401k Plan Participant Behavior - Summary: Schwab recently released information about retirement plan participant behavior to help employers better understand how their employees are approaching their 401k plans in the current market and economic environment. Located at: 401khelpcenter.com. Click on headline for full article.

Survey Finds Employees Committed to Saving for Retirement - Summary: Employees participating in retirement savings plans, such as a company-sponsored 401k, remain committed to saving for retirement despite current and future concerns about the economy, according to the latest findings from the annual Mercer Workplace Survey. Located at: 401khelpcenter.com. Click on headline for full article.

Retirement Future Shelved by Economic Uncertainty - Summary: At the start of this year, fully 46% of our financial advisor respondents said their clients were still on track to a timely retirement. By the end of the year advisors and their clients had a much bleaker picture of retirement. Located at: 401khelpcenter.com. Click on headline for full article.

Chaos Theory - Summary: A practical explanation of the credit crisis -- how we ended up in the current economic situation and where we can go from here. Located at: Buck Consultants (PDF File). Click on headline for full article.

How to Fix 401k - Summary: Has the 401k failed? In the wake of the stock-market meltdown, that question is on the minds of a growing number of policy makers, academics and corporate leaders -- not to mention the account holders staring in disbelief at their quarterly statements. Located at: Wall Street Journal Online. Click on headline for full article.

Plan Participants Respond to Market Declines by Choosing Safer Investments - Summary: Some workers are reacting to the market volatility by moving their 401k assets into less risky investment funds. Furthermore, the tight economic times are prompting more employees to tap into their retirement savings in the form of hardship withdrawals. Located at: CCH. Click on headline for full article.

More Employers Halt 401k Matches as Recession Hits - Summary: While the vast majority of companies likely will resume their corporate matches when the economy improves, some, like Ford, may do so with lower contributions, benefit consultants say. Located at: Workforce.com (free registration may be required). Click on headline for full article.

More Firms Quit the 401k Match Game - Summary: Under cost pressure, Vail Resorts, Station Casinos, and Intermountain Healthcare join a growing list of companies suspending payments equal to employee contributions. Located at: CFO.com. Click on headline for full article.

Looking for Control in an Out-of-Control World - Summary: Maintaining control in what appears to be an out-of-control environment is the biggest challenge facing investment committees today. But, this is an ideal time for an investment committee to review, tighten policies and revisit objectives. Suggested starting places are given. Located at: Vanguard. Click on headline for full article.

401k Trading Restrictions Old Fix...New Fault - Summary: Could excessive trading rules, which often limit a participant's ability to execute roundtrip trades within a 90 day period even in the context of a normal, well disciplined rebalancing protocol, be unreasonable in today's volatile investment environment? Located at: Fiduciary Investor Blog. Click on headline for full article.

Companies Rethinking Company Stock in 401k - Summary: Given the dramatic dive in the U.S. equity markets this year—and the ever-present risk of being slapped with a stock-drop lawsuit during a downturn—companies are looking for ways to protect both themselves and their workers from too much exposure to company stock in 401k plans. Located at: Financialweek.com. Click on headline for full article.

401k Plans Move Away From Employer Stock - Summary: Increasingly, employees are given the option to choose how their 401k plan funds are invested; this greater choice is one factor in the decreased exposure to investment in employer stock. Located at: US Bureau of Labor Statistics (PDF File). Click on headline for full article.

How Gender, Age Affect Retirement Plan Participation - Summary: How do gender and age affect the likelihood that you will participate in a retirement plan? Located at: Employee Benefit Research Institute (PDF File). Click on headline for full article.

IRS Provides Relief for Sponsors of 403(b) Plans - Summary: This relief suggests that plan sponsors that have adopted either new or revised plan documents in anticipation of the new guidance can correct those documents in 2009. For plan sponsors that have not yet met the plan document requirement, the Notice allows them extra time to implement the plan document, provided that they otherwise make a good faith effort to comply with the final 403(b) regulations. Located at: McDermott Will & Emery. Click on headline for full article.

IRS Provides 403(b) Relief: Notice 2009-3 - Summary: This notice provides relief during 2009 for sponsors of 403(b) plans with respect to the requirement to have a written 403(b) plan in place by January 1, 2009. This notice also briefly describes other programs the IRS intends to establish relating to 403(b) plans. Located at: IRS (PDF File). Click on headline for full article.

403(b)/401k Comparison Chart - Summary: This is a chart that compares code §403(b) with code §401k plans. Located at: McKay Hochman. Click on headline for full article.

EBSA Issues Field Guidance on ERISA Fidelity Bonding Requirements - Summary: The Employee Benefits Security Administration (EBSA) has issued Field Assistance Bulletin 2008-04 that provides guidance on fidelity bonding requirements under ERISA. Located at: CCH. Click on headline for full article.

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