April 2014 Archive

New mortality table recommended by Society of Actuaries

April 22, 2014

In February the Retirement Plans Experience Committee (RPEC) of the Society of Actuaries released its Exposure Draft RP-2014 Mortality Tables, recommending new mortality tables for the valuation of defined benefit plan liabilities. In this article we review the SOA RP-2014 report, focusing on its consequences for regulatory purposes. We begin with a discussion of the regulatory framework and then proceed to a discussion of the exposure draft and its implications. Read More

The cash balance capital preservation guarantee: quantitative analysis

April 17, 2014

This is the second article on the capital preservation guarantee ('floor') applicable to cash balance plans that use a ‘market-based’ interest crediting rate (we call such a plan a ReDefined Benefit (ReDB®) plan®). In our first article we discussed how the ‘floor’ works, the challenges it presents, and different design alternatives that may address those challenges. The question we explore in this article is: how does the floor affect outcomes for sponsors under a ReDB® plan compared with the simpler DC design? Read More

The President’s 2015 budget and retirement benefits

April 08, 2014

On March 4, 2014 the Obama Administration released its 2015 fiscal year budget. The retirement benefits-related provisions of the 2015 budget are generally similar to those in the 2014 budget. In this article we briefly review them. Read More

Congressman Camp’s comprehensive tax reform proposal

April 07, 2014

On February 26, 2014, Congressman Dave Camp (R-MI), Chairman of the House Ways and Means Committee, released a ‘discussion draft’ of the Tax Reform Act of 2014 (TRA 2014), a comprehensive revision of the Tax Code. In this article we review TRA 2014 proposals that would change the tax treatment of retirement savings, discuss how proposed changes to tax rates might affect the incentives for individuals to save for retirement, and consider the politics of this proposal. Read More

2014 Compliance Calendar

April 03, 2014

October Three is pleased to provide you with this 2014 Pension Compliance Calendar! The calendar captures important filing and plan notification dates and can be referenced by plan sponsors throughout the calendar plan year reporting cycle to help keep track of important deadlines and qualified plan reporting requirements. Please feel free to contact October Three if you require assistance in reviewing or preparing any of the reporting referenced in this document. Download

March 2014 Pension Finance Update

April 01, 2014

Pension finances deteriorated slightly in March, and both ‘model’ plans we track ended the first quarter of 2014 in modestly negative territory. Traditional ‘Plan A’ lost about 1% last month and is now down almost 4% for the year, and ‘Plan B’ slid less than 1% during March, ending the quarter almost 2% in the red. Download

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