Mainstay Capital Management, LLC

Allison Transmission SERSP and HERSP plans

Allison Transmission Plan Review as of September 1, 2008

Introduction
With over three dozen investment options available, the Allison Transmission Salaried Employee Retirement Savings Plan (SERSP) and Hourly Employee Savings Plan (HERSP) are among the best in the country. There are certainly enough funds in these plans to build a well-diversified portfolio for your 401(k) savings.

In this page of the website we include some "Featured Funds" within the Allison Transmission 401(k) plan. We provide a table containing many of the funds available within the Allison plan with critical data on each fund including style, risk, and past performance. Throughout the page we provide other information concerning the plan and links to other areas of our website that may be of interest.

Check this page for future updates to the Allison Transmission plan as well as news that affects your company and your 401(k) investments.

Request Mainstay Capital Management’s, “Allison Transmission 401(k) Investment Guide.”

Investment Option Changes - As of August 28, 2008
Fidelity has announced changes that will affect the Allison Transmission Hourly Employee Retirement Savings Plan. In the Allison Transmission 401(k) plan, Davis New York Venture Fund has been added effective September 30, 2008.

Effective September 30, 2008, the Ariel Fund and Fidelity Growth and Income Fund will be frozen to new contributions or exchanges. Any future contributions into the Ariel Fund will be directed to the Spartan Extended Market Index Fund. Contributions to the Fidelity Growth Fund will be directed to the Davis New York Venture Fund.

This notice is to our clients that we are aware of the details of these plan changes and that we have analyzed these plan revisions to determine appropriate changes to client portfolios in light of the new investment menu.

Roth 401(k) Option
The Roth feature within a 401(k) plan allows employees to “tax diversify” their income sources for retirement. Employees have the flexibility to direct contributions between both types of 401(k) accounts as their current and future tax situation dictates. Additionally, for those Allison employees who are ineligible for a Roth IRA, a Roth 401(k) provides an opportunity to build a tax-free retirement income source.

We applaud Allison Transmission for taking advantage of this provision in the Economic Growth and Tax Relief Reconciliation Act of 2001 (EGTRRA).

Request a free copy of Mainstay Capital Management’s “Roth 401(k) Investment Guide”.

Roth 401(k)s - Frequently Asked Questions

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

Allison 2008 Window Program

Funding Healthcare Costs After Age 65

For Your Interest

Chicago Tribune, May 4, 2008
Consider financial future before accepting buyout

Wall Street Journal, February 20, 2008
How to Value the Buyout Offer

Wall Street Journal, June 21, 2007
Getting Personal: Financial Planning Before the Buyout

Kiplinger's, Fall 2007
Create a pension back up plan

Flint Journal, April 2, 2007
Buying in to a buyout

Pyramis Active Lifecycle Funds
The Pyramis Active Lifecycle fund family 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 ultimately determine investment strategy and asset allocation. Additionally, they leave no room for the fund manager to tactically adjust 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.

Printer Friendly PDF Version: Allison Transmission 401(k) - Fund Table

If you have any questions concerning our website or your Allison Transmission 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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Mainstay Capital Management Sponsor of UAW GM/Delphi - Day at the Races

Mainstay Capital Management Sponsor of
UAW GM/Delphi - Day at the Races