G4
Personal Finance
401(k) plan from G1
place retirement plans, said about 8 percent of its clients — about 300 companies — had suspended or reduced contributions to em- ployees’ 401(k) plans as of July. But the survey found that 44 per- cent have since reinstated the benefit or plan to do so over the next year. Under many 401(k) plans, com- panies agree to match a certain percentage of employee contribu- tions to their retirement ac- counts, and workers can choose how to invest that money. Beth McHugh, Fidelity vice president for market insights, said she ex- pects the number of companies reviving the contribution to grow as the recovery gains momentum. Typically, large companies are among the first to reinstate the match, with small businesses fol- lowing. “It’s a good indicator of the em- ployer’s confidence in their fiscal
future,” McHugh said. Vanguard, another large retire- ment plan provider, said 4 per- cent of its clients suspended their contributions last year and 1 per- cent reduced the amount of the match. Since then, about 29 per- cent of those clients have brought it back at some degree. Another study by the nonprofit Profit Sharing/401k Council of America found that 15 percent of all com- panies had suspended or reduced their match last year, with 46 per- cent planning to have reinstated it within the first half of this year. Council President David Wray said that the cuts were driven by the sharp drop in revenue that many firms experienced during the financial crisis. Companies scrambled to cut costs in response —in many cases by slashing jobs. Contributions to 401(k) plans were also an easy target, Wray said, and firms have suspended the benefit in previous downturns with few consequences.
KLMNO
SUNDAY, APRIL 11, 2010
As confidence in the economy comes back, so do 401(k) matches
For workers, the move came at the same time that the stock mar- kets were plummeting, resulting in a double whammy to their re- tirement accounts. According to Fidelity, its average individual 401(k) balance dropped 27 per- cent in 2008 to $50,200. But workers largely recouped those gains last year as the average bal- ance rose 28 percent to $64,200. Many feared that companies would not reinstate 401(k) contri- butions even after the economy improved. But Wray said that al- most all of the firms that had sus- pended them during the 2001 re- cession eventually brought them back. Companies have moral and competitive incentives to contrib- ute to workers’ retirement, he said. “All that goodwill would’ve
gone away in a heartbeat if they hadn’t done it,” Wray said. “This is a commitment.” Fidelity reported that more than half of its manufacturing cli-
ents have reinstated 401(k) contri- butions, the most of any sector. About 44 percent of professional and technical services companies and 36 percent of information services firms have brought them back. Government defense contrac-
tor GenCorp, based in Sacramen- to, suspended its 401(k) benefit Feb. 1, 2009. It had matched with company stock 100 percent of the first 3 percent contributed and 50 percent of the next 3 percent. The company employs 3,000 people in 14 states. A few weeks ago, the firm noti-
fied employees it would reinstate the match in July with a small change: It would be made in cash, rather than stock. Chief Financial Officer Kathy Redd said the firm had always hoped to reinstate the contribution. “We believe that that’s impor-
tant,” she said. “You’re essentially taking away a very key compo- nent to someone’s compensation.”
Financial services firm Mor- ningstar saved $1.2 million in one quarter by suspending 401(k) con- tributions. Chief Financial Officer Scott Cooley said the company needed to reduce costs but want- ed to avoid layoffs, so it opted for the “shared sacrifice” of cutting the match, he said. The rebound in the stock mar-
kets has eased the pressure on many of Morningstar’s clients. So the company began phasing its re- tirement benefit back in this year,
matching up to 50 percent of em- ployee contributions up to 7 per- cent. Previously, it matched 100 percent. Morningstar had also frozen salaries last year but plans to begin giving moderate raises later this year and hiring for some unfilled positions. Cooley said he eventually hopes to fully restore the match to its former level. “For us,” he said, “the question was when, not whether we would bring it back.”
muiy@washpost.com
THE COLOR OF MONEY
Renting isn’t reckless if you’re not ready for homeownership
color from G1
Discover a career you believe in.
GENERAL MANAGER, MOBILE
Staying at the forefront of the media industry
isn’t easy.We need your expertise. Build your
career with us, and be a part of our success.
We promote a drug-free work environment.
Washington Post Media is committed to diversity in the workplace.
The Washington Post’s mobile business is a rap- idly growing part of our digital division and is fo- cused on building world class customer experi- ences on portable devices. The Post is looking for a creative, experienced individual to lead the company’s mobile efforts across all mobile plat- forms (smartphones, tablets, ereaders). The posi- tion involves managing all aspects of our mobile business — from content strategy to product de- velopment, sales strategy, business development, marketing and promotion. The General Manager will be responsible for managing a P&L and meet- ing or exceeding the company’s defined business and audience goals. Qualified candidates will have 8 or more years of product management/general management experience with an online product or service, proven success in developing a sales strategy and performing sales development ac- tivities for a new product. Experience managing mobile products is preferred.
For a detailed job description and to apply, please visit us online.
Learn more about Washington Post Media and other career opportunities at
washingtonpostmedia.com/careers.
Department of Energy
ASSOCIATE CHIEF INFORMATION OFFICER
FOR INFORMATION TECHNOLOGY SUPPORT SERVICES
Vacancy Announcement #IM60-30YK
Department of Energy (DOE)
Office of the Chief Information Officer Washington, DC
$119,554 - $179,700 annually
The position serves as the Associate CIO for Information Technology Support Services within the Office of the Chief Information Officer. The incumbent will be responsible for an array of essential and mission critical IT services supporting the majority of DOE’s Federal staff and their immediate support contractors, as well as most of the program offices. This position provides the strategic and tactical operational management and customer services oversight for the Department’s primary administrative IT infrastructure.
SPECIALIZED EXPERIENCE The incumbent must have: Experience managing IT infrastructure for an Agency, including operational and customer service oversight for federal and contractor staff, data centers, and network services.
Experience leading complex IT programs/projects and to quickly
and accurately analyze technical, budgetary, and performance objectives in order to arrive at factual conclusions pertaining to agency objectives. Experience leading investment management processes, and measuring and evaluating program performance as it relates to themanagement of IT architectures and oversight direction of major systems acquisition projects. Experience in applying principles and objectives of IT in order to improve the performance of technical and management functions within and outside the Agency.
Applicants are required to complete and submit an on-line application at www.usajobs.opm.gov under announcement number IM60-30YK.
Incomplete applications will be rejected. Please contact Yolanda Knights
yolanda.knights@hq.doe.gov for announcement information .
This vacancy will close on May 14, 2010
U.S. Trade and Development Agency
Deputy Director
Senior Executive Service
$119,554 – 165,300 plus benefits
The U.S. Trade and Development Agency promotes economic growth in developing nations by funding activities to develop a modern infrastructure and a fair and open trading environment in host countries by funding grants and contracts for project definition and investment analysis for trade capacity building and sector development activities. This is accomplished through pri- vate sector partnering to generate business and export opportunities for U.S. companies and job creation domestically.
The USTDA is recruiting for a candidate with strong executive management and leadership skills to manage the U.S. Trade and Development Agency and serve as Acting Director in the Director’s absence. Responsibilities include working with senior staff on a full range of regional program and management issues including making policy recommendations, recommending specific program activities and funding, managing the agency’s executive resources, and representing the agency and the Director in a variety of forums, both domestic and international. The Deputy Director also directs the agency strategic planning process and audit program, oversees the annual budget, and provides leadership and direction of all support management services.
The candidate must have experience that demonstrates knowledge of foreign economic development by perform- ing or managing activities to promote economic growth in developing and middle income countries, fair and open trading environments, or business and export opportunities for U.S. companies.
To apply for this vacancy and to obtain mandatory information, qualifications requirements, and application procedures, visit:
www.usajobs.opm.gov
Discover a career you believe in.
PRODUCT MANAGER, MOBILE
Staying at the forefront of the media industry
isn’t easy.We need your expertise. Build your
career with us, and be a part of our success.
TheWashington Post is seeking a creative, expe- rienced Product Manager to develop, implement and manage mobile product development for TheWashington Post. This position will require working closely with business and technical man- agers, designers, software development engineers, editors and customers. The Mobile Product Man- ager will work in close coordination with sales on developing revenue streams for advertisers, car- riers and users. Ideal candidates must have ex- cellent product instincts, coupled with a passion for delivering world-class news and utility to our customers. Ideal candidates will have 4 or more years of product management experience with an online product or service, a track record of managing and delivering digital products/features, and experience on mobile devices. A bachelor’s degree is required;MBA or post-graduate degree preferred.
We promote a drug-free work environment.
is committed to diversity in the workplace.
Washington Post Media
For a detailed job description and to apply, please visit us online.
Learn more aboutWashington Post Media and other career opportunities at
washingtonpostmedia.com/careers.
enterprise that was created to help expand opportunities for potential buyers by making money available for mortgages. In many respects, the mission was successful. Homeownership in this country climbed for decades, with the rate peaking in 2004 at 69.2 percent, according to data pulled together by the Hoover Institution at Stanford University.Homeownership jumped significantly from 1940 to 1960, according to census data, increasing from 43.6 percent to 61.9 percent.
But as the number of
homeowners increased, so did the belief — fueled by lenders and others working in the mortgage industry — that a home was a savings account. We were enticed by lenders to tap into our equity, secure in the belief that a house would always increase in value. The financial wisdom we came to embrace was that draining our home equity was a risk-free deal. We even took the Holy Grail of homeownership to a disastrous place by chastising people who didn’t have a mortgage. People were counseled to get a home loan for the mortgage-interest deduction. However, that deduction was never intended to promote homeownership, wrote Dennis J. Ventry Jr.,a University of California atDavis law professor, in the journal Law & Contemporary Problems. Ventry concluded that the mortgage deduction promoted overinvestment in residential real estate. How true. We made renting seem so
financially reckless that it surely encouraged people to jump into buying a home before they were ready. The Fannie Mae National
Housing Survey, conducted in December 2009 and January 2010, polled people with home loans and renters to gauge their feelings about the current state of homeownership, including whether they view a home as a safe investment. Turns out many still see owning a home as key to increasing their wealth. The Fannie Mae poll found
that seven out of 10 respondents
said buying a home is still one of the safest ways to invest. However, the survey also uncovered a new trend regarding homeownership. Survey participants ranked a safe neighborhood and living near good schools ahead of making money on their home as a leading reason to become a homeowner. Twenty-three percent of renters said they changed their plans and are putting off purchasing a home. Hallelujah!
“Consumers are still
committed to owning a home but are showing increased cautiousness, regardless of whether they rent, own their homes outright or have a mortgage,” said Doug Duncan, Fannie Mae’s vice president and chief economist. It’s what Duncan said next that
I think is a sign that maybe, just maybe, people now understand that a home is not an ATM or a risk-free investment. People, he noted, “are rebalancing their attitudes toward housing and
homeownership by adopting a more realistic, long-term approach and are less willing to take risks. This focus on sustainable housing is better for the economy, better for the housing market and better for America’s families.” In the Fannie Mae poll, respondents cited poor credit or a belief that they would not be able to afford the purchase and upkeep on a home as the top reasons for delaying homeownership. It’s great that people are
viewing homeownership with much more caution now. You are not a financial failure if you rent. It may be the smartest financial move you make until you are ready to handle a mortgage.
singletarym@washpost.com
Readers can write to Michelle Singletary at The Washington Post, 1150 15th St. NW, Washington, D.C. 20071.
Comments and questions are welcome, but because of the volume of mail, personal responses are not always possible. Please note that comments or questions may be used in a future column, with the writer’s name, unless a specific request to do otherwise is indicated.
This announcement is neither an offer to sell nor a solicitation of an offer to buy any of these securities. The offering is made only by the Official Statement.The information set forth in this announcement was obtained from sources we believe to be reliable but we do not guarantee its accuracy. All such information is subject to the information in the final Official Statement.
Proposed New Issue
Standard & Poor’s: Ratings Applied For Fitch Ratings: AAA/F-1+
*
$109,960,000*
$8,340,000*
Clean Water State Match Revenue Bonds, Series 2010A Due April 1, 2011
$101,620,000*
Clean Water State Revolving Fund Revenue Bonds, Series 2010B Due October 1, 2013-2032
FINANCING THE CHESAPEAKE BAY RESTORATION
Priority Order Period for Retail Buyers only Tuesday, April 13, 2010 Institutional Pricing
Wednesday, April 14, 2010
• Interest is exempt from Federal and Commonwealth of Virginia income taxes** • Bonds will be available in denominations of $5,000 (or multiples thereof)
For further information, including copies of the Preliminary Official Statement for these Bonds, please contact the firms listed below or visit:
www.BuyVRABonds.com
BofA Merrill Lynch
(800) 937-0768
Siebert Brandford Shank & Co., LLC
(800) 334-6800
Fidelity Capital Markets
(800) 544-5372
www.sbsco.com/pages/affiliates.html
Citi
(800) 833-5522 www.fidelity.com/newissuemunis
*†Short-Term Ratings apply only to Series 2010A Bonds. **Preliminary, subject to change.
**Before purchasing any Bonds, contact your tax advisor to determine any applicable federal, state and local tax consequences.
www.smithbarney.com
Morgan Keegan & Company, Inc.
(800) 362-1464
Confirmed Credit Ratings:† Moody’s: Aaa/MIG1
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