_{Reproduced with permission from Daily Report for Executives, No. 27 (Feb. 11, 2008), p. C-1.
Copyright 2008 by The Bureau of National Affairs, Inc. (800-372-1033)}

Labor Department Effort to Enhance Plan Fees Disclosure Draws Mixed Response

Plan providers and sponsors generally are happy with the Labor Department’s fee disclosure guidance, while those who represent participants see a need for more work, according to interviews conducted by BNA during December and January.

In response to cries that tax code Section 401(k) plan sponsors were neither asking for nor getting the fee disclosure they needed, the Labor Department issued final regulations covering reporting requirements under Schedule C of the Form 5500 (221 PBD, 11/16/07; 34 BPR 2702, 11/20/07), and proposed regulations under Employee Retirement Income Security Act Section 408(b)(2)’s prohibited transaction exemption (238 PBD, 12/13/07; 34 BPR 2925, 12/18/07). The department also intends to issue new rules governing direct disclosure to participants.

Employers not liable for 401(k) losses in target account by Kathleen Pender, San Francisco Chronicle, Sunday, October 28, 2007.

The U.S. Labor Department last week issued final rules designed to get more employees participating and investing more aggressively in their 401(k) plans.

The new rules say that employers can’t be held liable for losses in a 401(k) account if they enroll employees who don’t sign up themselves and direct their contributions into one of three qualified default options: target-date funds, balanced funds and managed accounts.

Jon Chambers is quoted in an article on how to plan your Year-end income tax strategies by Kathleen Pender, San Francisco Chronicle, November 28, 2006.

As the end of 2006 approaches, here are some tax- and money-saving moves to consider before Dec. 31.

• Pump up your 401(k).

• Think twice before buying a stock fund in a taxable account.

• Think twice before buying a stock fund in a taxable account.

• Maximize tax losses.

• Give a gift.

Dow dives on ho-hum earnings, oil worries by Carolyn Said, San Francisco Chronicle, Saturday, January 21, 2006.

Jon Chambers, principal at investment-consulting firm Schultz Collins Lawson Chambers in San Francisco, said investors shouldn’t fret over Friday’s one-day drop.

“The market will balance itself out. We’ll have bad days and good days,” he said. In fact, Chambers said, bad days are simply the price investors pay for potentially bigger payoffs in the long run.

“A day like today reminds us why we expect 10 percent (returns over time) from the stock market,” he said. “If you didn’t have greater risk, you wouldn’t have greater reward. You do better in stocks than in a money market or a bond because you have the risk of bad days, bad months or bad years. If you were never to have a bad day, month or year, and all you could expect would be a risk-free rate of return, then you’d get the same (low) return as a money market.”

From Advisers selling DC plans must improve fee disclosure (subsciption required) by Rick Miller on November 1, 2004:

However, there are those who believe that the majority of brokers who sell plans for a commission—and don’t consider themselves fiduciaries—are not always being straightforward about their compensation.

“In my opinion, more don’t provide disclosure in an explicit form than do,” said Jon C. Chambers, principal of Schultz Collins Lawson Chambers Inc. in San Francisco, a consulting firm and registered investment adviser supporting about $1 billion in retirement plan assets. “The majority make sure the prospectuses are delivered, things like that, but is that really disclosure?”

Stocks lose their footing: Steep slide by technology companies leads the region’s drop by Carolyn Said, San Francisco Chronicle, Friday, October 1, 2004.

“Every bull market since World War II has had at least one correction—a 10 percent drop, not a 20 percent drop,” said Jon Chambers, vice president of Schultz Collins Lawson Chambers, a San Francisco investment consulting firm that primarily works with institutional retirement plans. “It would be rational to assume that (the recent drop signals) a correction, without meaning that the bull market is over.”

From A fund limits its growth by Kathleen Pender, San Francisco Chronicle, Tuesday, July 20, 2004:

Fidelity Low-Priced Stock is the 10th most-popular fund in 401(k) plans. But if you don’t own it in your retirement plan by July 30, you won’t be able to buy it through your plan for the foreseeable future.

..The [Oregon state employees] plan decided to replace [Low-Priced Stock] with the American AAdvantage Small Cap Value fund. Pension fund consultant Jon Chambers is recommending the same fund to his clients as a replacement for Low-Priced Stock.

‘F’ stocks rise to top of class by Kathleen Pender. San Francisco Chronicle, Thursday, November 13, 2003.

So what’s out of whack: the model or the market?

Jon Chambers, a principal with Schultz Collins Lawson Chambers in San Francisco, says the results suggest that Schwab’s approach “doesn’t really work. It shows you how hard it is to come up with a system for beating the market.”

From Selecting a 401(k) plan provider: Navigating the maze
Global Finance, Sep 2003 by Gordon Platt:

Jon C. Chambers, principal at San Francisco-based Schultz Collins Lawson Chambers, an independent investment advisory firm that offers a provider-evaluation service, says many plan sponsors make frequent changes to their service vendors.

In setting up a selection committee to evaluate plan providers, Chambers says, a company needs to include participants from a range of disciplines. The plan sponsor needs to consider which investment and service configurations best suit its needs, he says.

From Balancing Act, by Donald Jay Korn, September 2003 Financial Planning magazine.

“A total return trust operates without the safety net of enforced conservatism,” notes Patrick Collins, a financial analyst in San Francisco who has written extensively about such trusts. “Therefore, it is vital to shape carefully the language of distribution provisions, lest the corpus run out of money prior to the end of the planning horizon. Distribution provisions both reflect and govern reasonable spending expectations, which in turn provide the targeted return for asset allocation and asset management decisions. Grantors and beneficiaries must determine a suitable balance between growth expectations [reward], failure rates [distributions below an acceptable dollar amount], and bankruptcy risk [portfolio value approaching zero].”