2007 Letter to Pension Santa
Dear Santa:
I've worked hard this year so I hope I get something other than coal. (Hey, we had to freeze the plan. Our stock was sagging.) It's been a tough year, with market volatility, investment complexity and ERISA lawsuits taking up much of my time. I thought 2008 would be a lay-up after a tough 2007 but it's not looking good. There's sub-prime fallout, low employee morale and a depressing outlook for growth in corporate profits. How much more can a fiduciary take?
I need a few goodies to keep me going. I'll won't forget you. The cookies and milk are waiting in the usual spot by the fireplace.
Here's my wish list.
1. Stable returns that don't cost me a fortune in terms of hidden fees or excessive risk
2. Independent service providers who take risk management seriously
3. Someone to help me select the right qualified default alternative investments, taking new rules into account
4. Recognition that my job adds value to thousands, perhaps millions of employees ( a thank you now and then)
5. Adequate resources to do my job properly
6. Someone to explain the ABC's of liability-driven investing, portable alpha and variable annuities without putting me to sleep or causing me to tear my hair out
7. Hedge funds that gladly offer full disclosure and don't require long-term lock-ups
8. Actuaries and accountants who agree on what constitutes the correct defined benefit plan liability (that ideally reflects economic reality)
9. Attorneys who will keep me up to date on my fiduciary duties and tell me how to avoid allegations of breach
10. An occasional chuckle now and then as a break from my very serious (but important) job - We have attorney, actuary and CPA jokes but nothing for pension fiduciaries. I wonder why.
By the way, I heard that even the North Pole had to cut back on legacy benefits for the hard-working elves. I hope you are giving them a good 401(k) plan instead.
Hang in there Santa!
HWPF
Hard Working Pension Fiduciary
P.S. If you want a bit of silliness, "elf yourself."
Editor's Note: Drop us a note and tell us what is on your wish list for 2008 and happy holidays!
