Introduction

With more than 30 investment options available, the Salaried Employee Retirement Savings Plan (SERSP) and Hourly Employee Retirement Savings Plan (HERSP) 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 Allison Transmission 401(k) savings.

For your reference, we have provided a “Fund Commentary” section below for further information on specific funds and/or fund types within the SERSP and HERSP accounts.

Below you will find articles of interest as well as news and updates to Allison employee and retiree benefits. Check this page for future updates to the SERSP and HERSP plans, as well as news that affects Allison employees and retirees.


For Your Interest


Plan Updates

Allison Fund Lineup Changes – January 2016

Allison Transmission has announced fund changes that impact the Allison Transmission Salaried Employee Retirement Savings Plan and Allison Transmission Hourly Employee Savings Plan (“the Plans”). Effective February 5, 2016, one fund will be added as an investment option to the plan and several funds will close and be removed.

Balances in the closing funds will automatically transfer to existing funds in the plan unless directed elsewhere by the participant.

Two funds will also change share class on February 5, 2016. As a result of the share class changes, the fund codes and ticker symbols will also change. For each fund, the new share class will offer the same investment strategy and risk, but will have a lower overall expense.

To discuss these important changes to the Allison 401(k) plans and how to allocate your portfolio in light of the new fund lineup, do not hesitate to contact Mainstay toll-free at 1‑866‑444‑6246.

Allison Savings Plan Changes – May 2015

Allison Transmission has announced fund changes that impact the Allison Transmission Salaried Employee Retirement Savings Plan and Allison Transmission Hourly Employee Savings Plan (“the Plans”).

Effective May 26, 2015, one fund will no longer be available and several investment options will change share class. As a result of the share class changes, the fund codes and ticker symbols will change. The new share classes will offer the same investment strategy and risk, but will have a lower overall expense.

To discuss these changes to the Allison Transmission 401(k) plans and how they may impact your current portfolio allocation, do not hesitate to contact us toll-free at 1-866-444-6246.

Allison Fund Change Announcement – January 2015

Allison Transmission has announced a fund change that impacts the Allison Transmission Salaried Employee Retirement Savings Plan and Allison Transmission Hourly Employee Savings Plan (“the Plans”). PIMCO Total Return Fund will be replaced by Metropolitan West Total Return Bond Fund, a fund with a similar investment objective.

This change will be effective as of the close of business on February 27, 2015. Contact Mainstay toll-free at 1-866-444-6246 to discuss this upcoming change and the impact it may have on your portfolio.

Allison Savings Plan Change Announcement – May 2014

Allison Transmission has announced fund changes that impact the Allison Transmission Salaried Employee Retirement Savings Plan and Allison Transmission Hourly Employee Savings Plan (“the Plans”). Several investment options in the Plans will change share class. Investment strategies and risks for these funds will be similar, but the overall expenses for the investment options will be lower.

These changes will be effective as of the close of business on June 25, 2014. Contact Mainstay toll-free at 1-866-444-6246 to discuss the impact these changes may have on your portfolio.

Allison Fund Change Announcement – July 2012

Allison Transmission has announced fund changes that impact the Allison Transmission Salaried Employee Retirement Savings Plan and Allison Transmission Hourly Employee Savings Plan (“the plans”). Beginning July 11, 2012 Templeton Institutional Foreign Smaller Companies Series Advisor was added to the fund lineup.

Effective July 11, 2012 Royce Value Plus Fund Institutional Class was removed from the plans and all existing balances in, and future contributions and loan repayments allocated to this fund were transferred to the Loomis Sayles Small Capital Value Fund Institutional Class, unless otherwise directed.

Also, effective July 11, 2012 Fidelity Stock Selector Small Cap Fund was frozen and closed to new investments. As of the market close on October 10, 2012 all remaining investments in the Stock Selector Small Cap Fund will be transferred to the Loomis Sayles Small Capital Value Fund Institutional Class unless otherwise directed. The Stock Selector Small Capital Fund will then be removed from the fund lineup.

Allison Savings Plan Changes – August 2009

Allison announced changes that will affect the participants of the Allison Transmission Salary Employee Retirement Savings Plan and the Allison Transmission Hourly Employee Retirement Savings Plan.

The following investment options are closed to new investments as of 4:00 PM on August 3, 2009:

Fidelity Value Fund
Fidelity Mid Cap Stock Fund
Fidelity Real Estate Investment Portfolio

The following investment options are added as of August 3, 2009:

Artisan Mid Cap Value Fund - Investor Class
Jennison Mid Cap Growth Fund – A

Anyone that was making contributions to the funds that will be closing, will have needed to redirect them by 4:00 PM on August 3, 2009. If no change was made, future contributions to the closed funds would have been redirected automatically according to the following table.

Fidelity Value Fuind To Artisan Mid Cap Value Fund

Fidelity Mid Cap Stock Fund To Jennison Mid Cap Growth Fund

Fidelity Real Estate Investment To Vanguard REIT Index Fund

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


News and Articles


Fund Commentary

Vanguard Target Retirement Funds

The Vanguard Target Retirement 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.

Twelve of these funds are included in the plan, with 5-year incremental targets from 2010 to 2060, along with a fund targeted as an Income Fund. The way the target retirement 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.

These 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. Target retirement 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 the 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 target retirement 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 target retirement funds offer a simple one-stop-solution, we continue to advise participants to avoid target retirement funds and retain the flexibility to proactively adjust their portfolios as needed.

Please reference The Problem With Target-Date Funds


 

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Important Consumer Disclosure

Mainstay Capital Management, LLC is an investment advisor registered with the Securities and Exchange Commission. Due to various state regulations and filing requirements, Mainstay and its representatives may only provide investment advisory services in those states in which it is first appropriately registered or otherwise exempt or excluded from registration requirements. The purpose of this website is to provide the public with general information about the services offered by our investment management firm. Mainstay does not render personalized investment advice or services or effect, or attempt to effect any securities transactions, on this website. Our firm continuously monitors its filing requirements in all states, and will provide individualized advisory services only in accordance with various state regulations. Mainstay does not make any representations or warranties as to the accuracy, completeness, or relevance of any information prepared by any unaffiliated third party provider, whether linked to Mainstay's website or incorporated herein. All such information is provided solely for convenience purposes only and all users thereof should be guided accordingly.