Visteon VIP and 401(k) Savings Plan

Introduction

With well over 30 investment options available, the Visteon Investment Plan (VIP) for salaried employees and 401(k) Savings Plan for hourly employees 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 Visteon 401k savings.

For your reference, we have provided a fund table displaying style, risk, and past performance for many of the funds in the VIP. In addition, please visit our “Fund Commentary” section below for further information on specific funds and/or fund types within the VIP account.

To the right you will find articles of interest as well as news and updates to Visteon employee and retiree benefits. Check this page for future updates to the VIP, as well as news that affects Visteon employees and retirees.

News and Updates

Visteon Freezes the VPP and Increases Company Match – October 20, 2011

Visteon has announced that they will “freeze” the Visteon Pension Plan (VPP) effective December 31, 2011. As of this date, no further cash balance pay credits will be earned and an employee’s base pay as of December 31, 2011 will be used to calculate their pension payment. In conjunction with the VPP freeze, Visteon also announced an increase in the company match to the Visteon Investment Plan (VIP). Effective January 1, 2012, Visteon will match 100% of employee contributions up to 6% of base pay. Previously, the match was 25% of employee contributions up to 6% of base pay.

Automatic Enrollment to the VIP - October 20, 2011

Visteon employees that are not currently contributing to the Visteon Investment Plan (VIP) will be automatically enrolled on January 1, 2012. These participants will be enrolled at a contribution rate of 3% of annual pay. Every January 1^st thereafter, this automatic enrollment will take place for all eligible employees that are not contributing. In addition, for those VIP participants that are contributing but at a level less than 6%, Visteon will increase their contribution rate by 1% each January 1^st until they reach the 6% level. This is to encourage all VIP participants to take full advantage of the company match. Participants will have the opportunity to opt out of both the automatic enrollment and the contribution increase each year.

Mainstay recommends all VIP participants contribute a minimum of 6% to maximize the company match. Call Mainstay Capital Management toll-free at 1‑866‑444‑6246 to discuss these changes or your personal situation with one of our Certified Financial Planners^TM.

Visteon Fund Change Announcement – April 2011

Visteon has announced changes to several investment options in the Visteon Investment Plan (VIP). The new investment options will provide similar investment strategies and risks, but the overall expenses for the investment options will be lower. These changes are effective as of the close of business on April 20, 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", or contact Mainstay toll-free at 1-866-444-6246 to discuss the impact these changes may have on your portfolio.

Visteon Reinstates Company Match – April 2011

Visteon has announced the reinstatement of the company match in the Visteon Investment Plan (VIP). Effective April 1, 2011, Visteon will match 25% of employee contributions up to 6% of base pay. For employees that elect to contribute at least 6%, this will equate to a 1.5% company match contribution each payroll cycle.

While your personal retirement plan may already call for a contribution level higher than 6%, Mainstay recommends that all Visteon salaried employees contribute a minimum of 6% to the VIP to maximize the company contribution.

Visteon Announces New Roth 401(k) Feature in the VIP – December 2010

Visteon has announced that effective January 1, 2011 a Roth 401(k) feature is being added to the VIP 401(k). This Roth feature within the VIP 401(k) gives employees added savings options within their retirement plan. Employees will now have the flexibility to direct contributions among both types of 401(k) accounts as their current and future tax situation dictates. For those VIP participants who are ineligible for a Roth IRA due to income limitations, the addition of the Roth 401(k) feature provides an opportunity to build a tax-free retirement income source.

Visteon also announced, effective immediately, the removal of the 10% maximum on the Spillover election in the VIP.

To discuss the new Roth 401(k) feature, removal of the Spillover election maximum, or your personal situation contact Mainstay Capital Management toll-free at 1‑866‑444‑6246.

Visteon’s Reorganization Plan Approved

Tuesday, August 31^st Visteon Corporation won confirmation of its Chapter 11 reorganization plan. Visteon first entered bankruptcy in March of 2009 and although there was speculation that Visteon would hand their pension plans over to the PBGC, they were able to structure a reorganization plan that would eliminate the need to do so. Although the details are not yet final, Visteon expects to exit bankruptcy by the end of September.

Fund Commentary

Note on Fidelity's Freedom Funds

The Fidelity Freedom Funds are designed for those participants who wish to base their asset allocation decision on a specific target year. The account is typically aligned with the Freedom Fund that most closely matches the year in which you anticipate beginning to withdraw your savings for your retirement.

Twelve of these funds are included in the Visteon plan, with 5-year incremental targets from 2000 to 2050, along with a fund targeted as Income Fund. The way the Freedom Funds are designed, 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.

Freedom 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. Freedom 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 roll in determining the investment strategy and asset allocation. Additionally, they leave no room for the fund manager to tactically adjust the allocation 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 Freedom Funds, or similar 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 Freedom Funds offer a simple one-stop-solution, we continue to advise participants to avoid these funds and retain the flexibility to proactively adjust their portfolios as needed.

Please reference "Target-Date Funds Face Regulation", published in The Wall Street Journal.

Fund Table - December 31, 2011

The Visteon VIP and 401(k) Savings Plan fund table provides critical data on investment options within the plan.

  Visteon VIP and 401(k) Savings Plan - Fund Table                                                    

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

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