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Funding Health Care Costs After Age 65

For Your Interest

ABC News Video: "Automotive workers seek advice on buyouts"

Dow Jones Newswires
Adviser Fights Fear About GM With Fact

Chicago Tribune
Consider financial future before accepting buyout

Wall Street Journal
How to Value the Buyout Offer


With over two dozen investment options available, the Rolls-Royce Corporation Personal Savings Plan for Hourly-Rate Employees and the Rolls-Royce North America 401(k) Savings Plan are among the best in the country. With this large number of funds, there is ample opportunity to build a well-diversified portfolio for your Rolls-Royce 401(k) savings.

For your reference, we have provided a fund table displaying style, risk, and past performance for many of the funds in these two plans. In addition, please visit our “Fund Commentary” section below for further information on specific funds and/or fund types within the Rolls-Royce 401(k) savings plans.

To the right you will find articles of interest as well as news and updates regarding Rolls-Royce employee and retiree benefits. Check this page for future updates to the Rolls-Royce 401(k) savings plans, as well as news that affects Rolls-Royce employees and retirees.

News and Updates

Rolls-Royce Fund Change Announcement - May 2014
Rolls-Royce has announced a change that will impact the Rolls-Royce North America 401(k) Savings Plan (the "Plan").

Fidelity Diversified International Fund previously frozen in the plan will be unfrozen as of June 5, 2014. This will allow participants to direct new future contributions or move money into this investment option.

To discuss this change to the Rolls-Royce 401(k) plan and how it may impact your investment allocation, do not hesitate to contact Mainstay toll-free at 1-866-444-6246.

Rolls-Royce Fund Change Announcement - February 2014
Rolls-Royce has announced a change that will impact the Rolls-Royce North America 401(k) Savings Plan (the "Plan").

The pending change surrounds the replacement of one existing investment option with a new investment option being added to the plan. This change will take effect on February 28, 2014.

Rolls-Royce Separation Package - January 2013
Rolls Royce has announced a Voluntary Enhanced Retirement Program (VERP) that will be offered to employees currently eligible for retirement and to those that are within one year of retirement eligibility. The decision to accept any buyout offer requires careful analysis and planning.

For those evaluating a buyout offer, there are important factors to consider:

  • Am I financially ready to leave Rolls Royce?
  • Which distribution period should I choose for my lump sum payment?
  • Have I developed a comprehensive Retirement Income Plan?
  • How would the VERP impact my current retirement plan?
  • Are my investments allocated appropriately for this life event?
  • What should I do with the assets in my Personal Savings Plan (PSP)?

Mainstay Capital Management is a fee-only, independent investment advisor that has counseled thousands of automotive employees on buyout offers. Mainstay currently provides portfolio management and retirement planning services to more than 2000 active and retired autoworkers. We can provide a comprehensive Retirement Income Analysis, help evaluate "what-if" scenarios, and assist in making well-informed decisions concerning the VERP or any buyout offer.

Call Mainstay Capital Management toll-free 1-866-444-6246 to discuss your personal situation with a Retirement Planning Specialist.

Rolls-Royce Fund Changes Announcement - May 2011
Rolls-Royce has announced upcoming changes to the investment options in the Rolls-Royce Corporation Personal Savings Plan for Hourly-Rate Employees and the Rolls-Royce North America 401(k) Savings Plan. The new investment options will provide similar investment strategies and risks, but the overall expenses for the investment options will be lower. These changes will be effective as of the close of business on May 9, 2011. Mainstay Capital Management’s CEO, David Kudla, has spoken and is published on the subject of reducing fees (internal expense ratios) for investment options within 401(k) plans. For further insight read his article penned for Forbes, "Why Investment Choices In Your 401(k) Might Change".

Fund Commentary

Pyramis Active Lifecycle Funds
The Pyramis Active Lifecycle fund family (Pathway One) is designed for those participants who wish to base their asset allocation decision on a specific target date, typically aligning the account with the fund that most closely matches their projected retirement date.

Eleven of these funds are included in the new plan, with 5-year incremental targets from 2000 to 2050. The further away the target date, the more aggressive the asset allocation. Conversely, the closer the date, the greater the emphasis on preservation of capital in the asset allocation.

Lifecycle funds hold some appeal in that they are simple to explain and administer. While this approach is unique, we believe the asset allocation decisions provided by these funds are crude at best. Lifecycle funds attempt to make decisions about asset allocation based solely on a target date. An investor’s tolerance for risk and financial goals are other key factors that should largely play a role in determining investment strategy and asset allocation. Additionally, they leave no room for the fund manager to tactically adjust the strategy based on specific opportunities within the financial markets or in response to prevailing market conditions.

The returns realized in these commingled vehicles are diluted by a rigid adherence to mechanical allocation parameters. These parameters may prove to be shortsighted and inappropriate for everyone participating in the pool. The real world changes every day, yet proponents of lifecycle funds expect someone to stick to a single game plan for as much as 40 years, whether interest rates are rising or falling, or whether the economy is in expansion or recession. While lifecycle funds offer a simple one-stop-solution, we continue to advise participants to avoid lifecycle funds and retain the flexibility to proactively adjust their portfolios as needed.

Fund Table - June 30, 2014

The Rolls-Royce fund table provides critical data on investment options within the plan.

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If you have any questions concerning our website or your Rolls-Royce 401(k) account, please feel free
to contact us using the following email link: Mainstay@mainstaycapital.com
or call us toll-free at 1-866-444-6246.

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