What is the match at Cardinal Health for their 401k plan? Thanks?
- Anonymous1 decade agoFavorite Answer
Cardinal Health 401(k) Savings Plan
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Commentary - We applaud the fact the Cardinal Health 401(k) Savings plan is a Safe Harbor 401(k) and encourage you to defer the maximum amount allowable. The plan offers several quality mutual funds. The plan lacks short and long term bond funds as-well-as corporate and high yield bond funds. There are no mid cap value or mid cap growth funds offered. There is no small cap value or small cap blend funds offered. There is no developing markets fund offered.
Current News - In today's Wall Street Journal, it was announced Fidelity Investments, which acts as trustee and recordkeeper on the Cardinal Health plan, is the target of a lawsuit brought by participants of John Deere & Co. 401(k) Plan. John Deere & Co was also mentioned in the lawsuit. The lawsuit alleges the fees charged to participants "were and are unreasonalbe and excessive, not incurred solely for the beneift of the plan and its participants and undisclosed to participants, " the suit says. Article to follow.
On November 8, 2006, it was announced that Federal Insurance Company, an insurer to CAH, filed a complaint against CAH on October 12, 2006. The complaint has asked the court whether it has any obligation in the complaints under the liability coverage it provides for CAH executives. See Article
On November 6, 2006 Stull, Stull & Brody and Schnatz Nobel have reported progress on the Cardinal Health, Inc. ERISA Litigation suit. The Court has denied a motion to dismiss which was brought on by CAH and other defendants. The parties are engaged in discovery and the case is moving forward. Plaintiffs have also filed a motion to certify the case as a class action. Presently, it is anticipated the Court will hold a hearing on the class certification in January or February of 2007. See Article
Current Investment Choices
Stable Value - Stable Value Fund
Short Term Bond - N/A
Intermediate Term Bond - PIMCO Total Return
Long Term Bond - N/A
Corporate Bond - N/A
High Yield Bond - N/A
Domestic Stock Offerings
Large Cap Value - Dodge & Cox Stock
Large Cap Blend - Fidelity U.S. Equity Index
Large Cap Growth - Fidelity Growth Company
Mid Cap Value - N/A
Mid Cap Blend - CRM Mid Cap
Mid Cap Growth - N/A
Small Cap Value - N/A
Small Cap Blend - N/A
Small Cap Growth - Columbia Acorn
Foreign Stock Offerings
Foreign Large Growth - Fidelity Diversified International
Developing Markets - N/A
Company Stock - CAH
Prior News - On September 1, 2006 the 401k was amended as follows: Section 1.10A of the Plan is amended by the addition of a new subsection (vii) thereunder to read as follows: (vii) Any bonus payment, including payments under the Cardinal Health, Inc. Management Incentive Plan “MIP” as originally established August 14, 1996 and amended and restated from time to time, if such bonus payment is wholly or partially payable without regard to the attainment of a performance-based goal. See Filing
In January of 2004, CAH discovered Putnam Fiduciary Trust Company allegedly delayed in investing certain assets in the 401k plan in January of 2001. The delay caused 401k participants to miss out on nearly $4 million of market gains. According to the complaint, CAH was not informed of the delay the defendants decided to shift assets to certain Putnam mutual funds through deception, illegal trade reversals, and account machinations. The complaint further alleges that Durgarian, Papa, Childs, and Crain also took steps to cover-up the wrongful conduct. The SEC is seeking injunctive relief and civil monetary penalties.
Since July 2004, 15 class action complaints (collectively referred to as “Cardinal Health ERISA actions”) have been filed against CAH and certain officers, directors and employees by participants of the 401k plan. To date all have been filed in the United States District Court for Southern District of Ohio.
The complaints allege the defendants breached certain fiduciary duties owed under ERISA, asserting the defendants failed to make full disclosure of the risks associated in investing in CAH stock. The complaints seek unspecified money damages and equitable relief against the defendants and an award of attorney’s fees.
In December 2004, the Cardinal Health ERISA actions were consolidated into one action captioned In re Cardinal Health, Inc. ERISA Litigation. In April 2005, the lead plaintiff filed a consolidated amended ERISA complaint naming CAH and certain officers, directors and employees, the Employee Benefits Policy Committee and Putnam Fiduciary Trust Company as defendants. In March of 2006, the Court granted the Motion to Dismiss with respect to Putnam Fiduciary Trust Company.
General - Formerly known as the Cardinal Health Profit Sharing, Retirement and Savings Plan, the Cardinal Health 401(k) Savings Plan (the 401k) is a defined contribution plan covering nearly all the employees of Cardinal Health, Inc. (CAH) The 401k is subject to ERISA.
The Cardinal Health, Inc. U.S. Qualified Plans Master Trust, formerly know as the Master Trust for Retirement Plans of Cardinal Health, was established for the 401k and other plans of CAH.
Administration - CAH previously established a Benefits Policy Committee that was responsible for the general operation and administration of the 401k plan. In late 2004, CAH established a Financial Benefit Plans Committee that now overseas the 401k plan.
Contributions-Contributions to the 401k consist of employee elective deferrals, safe harbor company matching, discretionary profit sharing, rollovers, transition benefits and special contributions. Participants direct all investments.
Participants may defer up to 50% of their compensation, as defined by the 401k plan, up to $15,000 for 2006 and $15,500 for 2007. Participants who are over age 50, or will attain age 50 by the plan year end, will be allowed a catch up contribution of $5,000 for 2006. The allowable catch up contribution amount will remain unchanged for 2007.
Because this is a safe harbor 401k, highly compensated employees will not be subject to the average deferral percentage test. This means, highly compensated employees will not be refunded money for exceeding deferral limits.
CAH has elected the matching safe calculation. CAH will match dollar for dollar the first 3% of participant’s elective pre tax deferrals. The next 2% of participant’s elective pre tax deferrals will be match at fifty cents per dollar. There is no match for participant’s deferring more than 5% of eligible compensation. Discretionary profit sharing contributions are allocated to participants based on their proportionate share of total eligible compensation. Transition benefits are contributed to participant accounts based on compensation levels and years of service.
Vesting - Participant elective deferrals and transition benefit contributions are 100% vested. Because of the safe harbor match election, all employer safe harbor match monies are 100% vested. After three years, or if the participant dies, becomes disabled, or reaches retirement age, discretionary profit sharing contributions will vest at 100%.
Expenses - Administrative expenses are paid by CAH or the plan. Loan fees are paid by the borrowing participant. Forfeitures of non-vested account balances for previously employed participants are either used to offset CAH contributions to the 401k or to offset expenses.
Loans - Participants may borrow up to 50% of their vested account balance, with the minimum loan amount being $1,000 and the maximum of $50,000. Loans terms can vary in duration from 1 to 5 years, or up to 15 years for the purchase of a primary residence. Currently loan rates are Prime plus 1%, adjusted monthly, for the term of the loan.
Payment of Benefits - Lump-sum distributions can be made upon termination of employment, death, disability or retirement. In addition, provisions for participants to make withdrawals under certain hardship circumstances or obtaining age 59 ½. Required qualified joint and survivor annuity payment options are preserved for the portion of participant accounts transferred to the 401k from a money purchase plan.
- LoriLv 44 years ago
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I have had one employer who would match .25 on the dollar up to my contribution of 8% My current employer will match 5% if I put in 2%. I have heard of companies that match dollar for dollar to the max amount. My wife's company divides a share of the earnings among all 401k participants at the end of the year. So they never know until then how much will be contributed. Another question to ask (if 401k is a big issue to you) is about the vesting schedule. Some have vesting immediately, my last employer, full vesting didn't take place until 6 years. BTW most financial folk I have encountered recommend maxing out a 401k before starting an IRA; unless you want to do a ROTH IRA (which you should look into).
- 3 years ago
Have never thought about it that way
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- caraLv 43 years ago