"We were big into fee disclosure before it really became an issue,” says Keith Overly, Executive Director of the Ohio Public Employees Deferred Compensation Program. “We think it is part of the value we provide, and part of our competitive advantage.”
“Especially in this market, risk became such a big issue for people,” says Ed Derman, Deputy CEO of the California State Teachers’ Retirement System. For risk-focused 457 participants, CalSTRS gives them the chance to invest in one of 15 portfolios that blend the target-date and risk-based concepts: five target-date options, each with a conservative, moderate, and aggressive level.
Though she says the success of Legacy Health Systems’ 403(b) program has little to do with her and is a collaboration of nine team members, as well as a partner provider and adviser, who understand the importance of the benefit and respond to employees every day, a conversation with Mary Ann Holbert, Director of Compensation and Benefits, Legacy Health Systems, would make it obvious to anyone the passion she has for the program and her job. “I want my legacy at Legacy to be that the employees really know and understand their benefits, and that it is easy for them to participate,” she exclaims.
For New Jersey’s state deferred compensation plan, “the emphasis for the longest time was on, ‘Let’s keep the costs down,’” says Joseph Zisa, Chief of the Bureau of Defined Benefit & Contribution Plans Reporting at the State of New Jersey Department of the Treasury. That led the 457 to do plan administration in-house, and its fund expenses ran as low as eight to 10 basis points.
Perhaps one of the greatest testaments to the work Mary Shinick, Vice President, Human Resources, Nyack Hospital, and her team have done to shore up the hospital’s retirement program is the fact that they were nominated for PLANSPONSOR’s Plan Sponsor of the Year award not once, but twice, by representatives of a provider that actually lost some business as a result.
Champlain College, founded in 1878, is located in the Hill Section of Burlington, Vermont, overlooking Lake Champlain. Just as impressive as that view is the college’s 403(b) plan, which boasts an astounding 94% participation rate among its roughly 300 eligible workers, a rate that David Provost, VP of Finance & Administration at the College, attributes to its education campaign.
Being the Vice President for Financial Affairs, Jack Armul at the Florida Institute of Technology says he would consider himself a “bean counter” more than an educator, but the adviser to FIT’s 403(b) plan says otherwise.
Measured against most public funds’ investment returns, the Texas Municipal Retirement System (TMRS) had a great year in tumultuous 2008. The fund lost only 1.3%, recalls David Gavia, Acting Executive Director at the Austin-based fund. “Compared to our peers,” he says, “it was a phenomenal result.” Many public funds dropped in the 20% to 30% range that year.
Standouts from the 403(b)/nonprofit, public, and corporate sectors
The same old thing was not going to work into the future,” says Punam Mathur, Vice President, Human Resources, at NV Energy, Inc. “The times are changing.”
As part of a plan revamp introduced in January 2008, Waltham, Massachusetts-based Thermo Fisher Scientific started matching 100% of an employee’s deferral, up to 6% of pay. The company also implemented automatic enrollment with a 6% default deferral for new hires in 2009, plus immediate eligibility and immediate vesting.
How does wholesale insurer Johnson & Johnson, Inc., achieve a 90% 401(k) participation rate without automatic enrollment? As a small company of just 140 employees, it facilitates a lot of one-on-one convincing. As recently as 2006, the participation rate at the Mt. Pleasant, South Carolina-based firm was just 69%.
In this issue, it is my honor and privilege to share the experiences and examples of some of the nation’s best plan sponsors—including four that, in our assessment, are worthy to be called “Plan Sponsor of the Year.”
Last month, the Pew Center on the States published a report titled “The Trillion Dollar Gap” that highlighted the apparent chasm between the potential obligations of the assorted pension and retiree health-care programs of the 50 states, and the money set aside to pay for them. In some respects, the portrayal was better than it might have been: For one thing, the analysis was based on plan year-ends that predated the Q4 2008 meltdown, and it focused only on state programs, rather than the assortment of local government programs.
Employers skeptical about health-reform savings
Study says investment “Help” makes a difference
We all have them: those front-line experiences that are inevitable when one deals with the variety—and sensitivity—of issues associated with human beings and critical life events. Sometimes those stories are tragic, sometimes they are bizarre, and sometimes—admit it—they are just plain funny.
In late January, the Obama Administration renewed its support for a variety of initiatives designed to improve/enhance retirement programs.
Each month, Bells & Whistles highlights recent product introductions that plan sponsors may find of interest. More information on these announcements can be found on www.plansponsor.com. If you have a product announcement that you believe would be of interest to our readers, drop us a line at email@example.com.
Financial crisis triggers additional scrutiny of target-date offerings
Gerald George, et al., v. Kraft Foods Global, Inc., et al., Case 1:07-cv-01713
Similarities between the health-care debate and the retirement-income debate
Negotiating the fiduciary delegation minefield
Time for a new look at TDFs