Mang Loans Case Study

MAnAGInG BeneFITs PLAns

hardship withdrawal, thus netting only $6,500, Ritter explained. the bigger loss, of course, is the future value of the money, according to the financial analysts. “if you left the $10,000 in for 20 years and it earned 8 percent, that would have amounted to $46,600,” Ritter noted. Ritter said that taking money out of a 401(k) plan—as either a loan or a hardship withdrawal—can be a false solution that keeps the person in crisis from taking appropriate action, such as selling the house, getting another job, or cutting expenses. “You need a systemic solution, something that’s going to change your household cash flow,” he said. liberto said another reason to avoid a hardship withdrawal in the current market is that the
“one of the things managers need to do in times of crisis is to communicate,” Bird said, “to share as much as they can about what’s happening at the company as the financial
Response: “along with the HdHp options, we also started offering health savings accounts that included employer contributions to these accounts,” the benefits administrator at the 225-employee firm told us. Result: “these new plans increased our participation in 2006; 65 percent of our employees who participate in the health program are covered in one of the HdHp plans,” the benefits administrator added. “due to the increased enrollment in 2006 and the reduced claims experience, we were able to offer our plans to employees in 2007 with no increase in premium amounts.” COnTAIn HeALTH BeneFIT COsTs WITH sIMPLe PLAn MODIFICATIOns Issue: a 400-employee transportation company was looking for simple changes to its benefits plan that would keep costs from rising more than 8 percent. Response: “our principal move was to couple an increase in deductibles with a contribution increase,” the controller told us. “Formerly, we also included dental coverage with the cost of medical. now, we charge additional amounts for it. Finally, we increased copayments for our drug program.” Result: increasing the deductibles saved the company roughly $150,000. “and to lessen the sting of these increases to employees, we supplemented our life offering, which was viewed