TAG 401(k) Factoids

Last week the TAG 401(k) trustees had their summer meeting. A few points of interest for Plan participants:

Assets in TAG 401(k) Plan -- $220,551,015

Active Participants -- 2,359

2nd Quarter Contributions -- $3,264,892

Average Participant Balance -- $90,767 ...

The Animation Guild 401(k) Savings Plan came into existence in Spring 1995, when Disney's Michael Eisner agreed the company could do a 401(k) program with its unionized animation staff.

Until then, it had been "no, no, NO!" from the Mouse's middle management. That ended when the company CEO said "fine, okay."

And big surprise. Once Disney agreed to a 401(k), most of the other companies with which TAG had contracts -- Warner Bros., DreamWorks Animation, Cartoon Network, etc -- came aboard as well.

The Plan has grown steadily since '95; we're now on the cusp of our biggest change in almost a decade: On August 1st, Plan administration switches from Mass Mutual to Vanguard, the largest, most cost efficient mutual fund company in the country. With the change will come a new lineup of investment choices:

TAG 401(k) Plan Funds Available After August 1st

Vanguard Target Retirement 2060 Fund
Vanguard Target Retirement 2055 Fund
Vanguard Target Retirement 2050 Fund
Vanguard Target Retirement 2045 Fund
Vanguard Target Retirement 2040 Fund
Vanguard Target Retirement 2035 Fund
Vanguard Target Retirement 2030 Fund
Vanguard Target Retirement 2025 Fund
Vanguard Target Retirement 2020 Fund
Vanguard Target Retirement 2015 Fund
Vanguard Target Retirement 2010 Fund
Vanguard Target Retirement Income Fund

Vanguard Retirement Savings Trust III
Western Asset Core Plus Bond Fund Class I
DFA Five-Year Global Fixed Income Portfolio Class Institutional
American Beacon Large Cap Value Fund Institutional Class
Vanguard Institutional Index Fund Institutional Shares
Principal LargeCap Growth Fund Institutional Class
Vanguard Mid-Cap Index Fund Institutional Shares
MassMutual Select Mid Cap Growth Equity Fund II Class I
DFA US Targeted Value Portfolio
Vanguard Small-Cap Index Fund Institutional Shares
American Funds EuroPacific Growth Fund Class R-6
DFA Emerging Markets Portfolio Institutional Class Shares
DFA International Small Company Portfolio
Vanguard Total International Stock Index Fund
Vanguard Total Bond Market Index Fund Admiral Shares

We've increased the number of bond and stock funds, and doubled the number of Target Date funds. The intent is to lower costs while broadening choices. Some old Mass Mutual funds will be departing, but viable alternatives will be out there.

I've been associated with the Plan since its beginning, and -- I'll admit it -- I feel a little paternalistic. I sometimes encounter members who say: There's no match, so I have no interest in putting money into it." But I think that's short-sighted. Working members are already in a defined contribution plan, called the Individual Account Plan, that's paid for by the studios. The TAG 401(k) Plan is a good supplement to the two industry-wide pension plans members are automatically enrolled in.

Added to which, the Guild's 401(k) Plan allows members to shelter income from state and federal taxes. (There are a number of participants who have a half million dollars in the two plans.)

It's tough saving enough money for retirement, I get that. But when you have the chance to be part of three separate pension plans, two paid for by your employer and the other sheltering your income from taxes, grab on to all of it.