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New Seafarers 401(k) Plan on Schedule

December 2007

The new Seafarers 401(k) Plan, secured as a result of the most recent standard freightship and tanker agreements, is on schedule to begin Jan. 1, 2008. As previously reported, this new benefit for eligible Seafarers does not involve employer contributions. Instead, it relies on voluntary contributions from individual participants via payroll deduction through their employer. Several employers already have agreed to implement this system. Seafarers should check with their port agents for up-to-date information on participating employers. An introduction letter and “welcome kit” is slated to be mailed to prospective participants no later than mid-December. Also, the Seafarers Plans office last month provided an update on the existing Seafarers 401(k) Plan, which formerly was known as the NMU 401(k) Plan. That plan had been scheduled to roll over into the new one as of Jan. 1, 2008. Due to a slight delay in processing, the official transfer of those assets will take place Jan. 15, 2008. A letter to plan participants is scheduled to be mailed in early December. That letter notes that while the old plan is transitioning from ING to Mass Mutual, there will be a short period of time when account activity will be frozen. This is standard procedure, and it means that during the transitional period, account holders will be unable to exercise certain rights otherwise available under the plan. As the letter points out, accounts will continue to be invested, and contributions will continue to be allocated during this “blackout” period. However, individuals may not request withdrawals, make changes to investment selections or transfer monies until the move is completed and balances are reconciled. Again, this situation applies only to participants in the existing Seafarers 401(k) Plan which used to be called the NMU 401(k) Plan. Once the transition is complete, those participants will find an enhanced selection of mutual fund investment options along with state-of-the-art internet and interactive telephone systems allowing unlimited access to account information and the ability to carry out investment transactions. During the November membership meetings, Seafarers Plans Administrator Maggie Bowen noted that for 2008, Seafarers 401(k) participants may contribute up to $15,500 apiece ($20,500 for those age 50 or older) to their respective accounts. She also cited the following components as “just a few of the great benefits the plan will include”: Tax advantages—specifically, the opportunity to make contributions on a pre-tax basis, which “will reduce your current taxes and have your wealth accumulate on a tax-deferred basis.” Additionally, ROTH after-tax contributions are an option. Twenty different investment options from a wide variety of leading money managers, including Mass Mutual, American Funds, Baron, Oppenheimer, T. Rowe Price and others. Pre-designed asset allocation model portfolios with risk/return characteristics ranging from conservative to aggressive. Direct access to personalized investment guidance and comprehensive financial planning from the team of Smith Barney financial consultants via a toll-free SIU phone number. Additional information on the new Seafarers 401(k) Plan will be published in upcoming issues of the LOG and reported at the monthly membership meetings. ###