November - December Convention Issue 2005
Thursday, Oct 6

Workshop: BAC Programs Increase Retirement Security

The Trowel Trades S&P 500 Index Fund and the BAC SAVE 401(k) plan provide unique tools to strengthen BAC members’ retirement security, Comerica Bank Vice President Gerard Arnone told delegates attending a workshop on this subject.

The Trowel Trades S&P 500 Index Fund is a bank collective investment fund available only to BAC pension plans. It is designed to mirror the performance of the Standard & Poors 500 Index, the benchmark for equities, thus enabling BAC plans to easily invest in the broad stock market. The Fund’s low expenses, which decline as fund assets increase, are a fraction of the 17 basis points typically charged by comparable mutual funds, Arnone said.

The Fund has proven popular with those BAC pension plans currently participating, with assets reaching $431 million after six years of existence. To participate, plan Trustees must execute participation agreements and transfer funds to Comerica Bank.

The BAC SAVE 401(k) Plan is designed to increase BAC members’ retirement income by providing an important supplement to their defined benefit pension plans. “The landscape is changing,” Arnone said. “Longer retirement means higher costs,” as do increases in the cost of living. BAC SAVE’s value, he explained, is that “this is an add on to your returns in terms of providing a monthly revenue stream as you retire.”

Members whose Locals negotiate participation in BAC SAVE in their collective bargaining agreements can designate a portion of their wages to be invested in the 401(k), and choose from 12 investment options, including four “lifestyle” funds designed to fit their age and retirement objectives. These BAC SAVE contributions are not taxed, reducing the amount members owe the IRS, and their investments accumulate tax deferred until retirement. Moreover, BAC SAVE’s administrative expenses are much lower than those charged by other 401(k) plans.

Both the Trowel Trades S&P 500 Index Fund and BAC SAVE cast all their votes on company resolutions in conjunction with AFL-CIO proxy voting guidelines. Thus, participation helps the Union use its economic clout to make America’s largest corporations more socially responsible and worker-friendly, while at the same time protecting the investments of participants.

For more information on the Index Fund, call 1-888-201-1711. For BAC SAVE, call 1-888-880-8222.