International Paper Co., Stamford, Conn., overhauled its $3.7 billion 401(k) plan, said Robert Hunkeler, vice president and director of investments. Beginning in April, participants can choose investments from three tiers: a set of three "Smart Mix” balanced funds managed by J.P. Morgan Fleming; a tier of 10 "core” funds; and a self-directed brokerage window. Also, participants’ fees will drop by 25% to 30%.
The core funds will be a company stock fund and nine of the company’s defined benefit pension portfolios repackaged as 401(k) plan funds: stable value, domestic bond, high-yield bond, emerging market bond, large-cap stock, midcap stock, small-cap stock, international stock and emerging market stock.
The plan named J.P. Morgan/American Century Retirement Plan Services as record keeper, replacing Towers Perrin.
Separately, the plan relaxed its restrictions on company stock. Only half of the employer match of 60 cents for every dollar, up to the first 8% of pay, now will be in company stock; participants will be able to invest the rest of the match in other options. Also, participants younger than 55 years old will be able to sell half of the company stock contributed to their accounts. Previously, the entire match was in company stock, and participants could not diversify into other investment options until age 55.
