From 1964 until 2002, the State of Nebraska sponsored a defined contribution plan for its employees. During this period, the plan was unique among state pension plans because it was an individual account-type plan that offered participants the choice of a lump sum or annuity distribution upon retirement. Such a choice presents the opportunity to learn more about how individuals perceive financial risks and weigh various factors when deciding how to access their retirement benefits. This study reports the results of a new survey of Nebraska state workers who retired or terminated employment in 1997. The results offer a perspective on how individuals perceive their decisions 10 years later. The findings reveal three general themes. First, retirees tended to underestimate the financial risks associated with uninsured health care expenses. Sixty-five percent of retiree respondents said that they had initially underestimated such risk. Second, federal policies may influence the distribution decision. For example, many respondents cited tax penalties on lump sum distributions as a major factor in their decision, which is consistent with a high percentage choosing a non-taxable direct rollover distribution.Finally, the results provide a basis for cautious optimism that retirees will be able to successfully manage a present value sum distribution during retirement. Over 90 percent of retiree respondents reported that they were able to cover their living expenses 10 years after their retirement.

The Employee Retirement Income Security Act of 1974 ("ERISA"), the federal law that regulates employer-sponsored benefit plans, has a rich history of judiciallycreated federal common law. This Article explores the theoretical, policy, statutory, and stare decisis grounds for the development of another area offederal common law under ERISA-the incorporation of respondeat superior liability principles to impose ERISA fiduciary liability ("vicarious fiduciary liability") upon a corporation for the fiduciary activities of its employees or agents. The Article proposes that the federal courts should adopt a federal common law rule of vicarious fiduciary liability under ERISA based on the traditional scope of employment approach. Under such a rule, a corporate principal whose own internal employees or agents perform fiduciary functions during the course and within the scope of their employment or agency relationship would be strictly liable under ERISA for any breach of fiduciary duty by the employee or agent. Vicarious fiduciary liability should be limited, however, so that a nonfiduciary corporate principal would not be subject to damages claims under ERISA for the rogue fiduciary activities of its employees or agents, but would be subject to restitution as necessary to prevent unjust enrichment of the principal. A federal common law rule of vicarious fiduciary liability under ERISA is necessary for two reasons. First, a rule of vicarious fiduciary liability is essential to maintaining and enforcing ERISA's comprehensive system of fiduciary regulation. Second, vicarious fiduciary liability is needed to prevent employer overreaching under the judicially-created settlor function defense to breach of fiduciary duty claims. Absent a federal common law rule of vicarious fiduciary liability, a corporate employer in its nonfiduciary capacity as the settlor of its ERISA plan, may design the documents that govern the employer's plan as a shield against fiduciary responsibility for the actions of the employer's own internal fiduciary employees. This misuse of nonfiduciary settlor powers, which is contrary to both the letter and the spirit of ERISA, would be prevented by a federal common law rule of vicarious fiduciary liability.

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