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CCH® PENSION — 10/23/07

PSCA To Conduct Benchmarking Study Of IRC Sec. 403(b) Plans

From Spencer's Benefits Reports: The Profit Sharing/401(k) Council of America (PSCA) has announced that it will be conducting its First Annual Non-Profit Benchmarking Study, a survey of “best practices” among sponsors of IRC Sec. 403(b) tax-sheltered annuities. Sec. 403(b) plan sponsors can access the paper survey form at http://www.psca.org/nonprofit/questionnaire.pdf.

In a press release, the PSCA notes, “Millions of people are saving for their futures in 403(b) retirement plans sponsored by nonprofit organizations and public schools, colleges, and universities. Those organizations are facing increased administrative responsibilities due to regulatory changes approved by the Treasury Department in July, but there is little comprehensive information to help them evaluate their plans in light of the new requirements.”

The benchmarking study will (a) demonstrate the importance of the nonprofit retirement plan market; (b) provide a comparison tool to measure how one nonprofit plan stacks up against other nonprofit plans and evaluate opportunities to improve plan design; and (c) provide fact-based information to help nonprofit plan sponsors with employee education.

According to the 2004 U.S. Census Bureau survey, nonprofit organizations employed 9.4 million paid employees, accounting for 10.5% of the total American work force. These employees outnumber those working for utilities, wholesale trade, and construction industries.

“When we discuss retirement savings, the focus is generally on 401(k) plans and for-profit companies, but the millions of Americans who work for nonprofit organizations need the same support from their employers to save for retirement,” noted PSCA president David Wray. “In the nonprofit market, a strong benefits package including a retirement plan is key in attracting and retaining employees.”

The results of the benchmarking study will be available in early 2008. The PSCA will provide a complimentary copy of the results to participating plan sponsors.

For more information on this and related topics, consult the CCH Pension Plan Guide, CCH Employee Benefits Management, and Spencer's Benefits Reports.

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