America’s Favorite Pastime

Can anyone guess who has the highest all time Major League Baseball career batting average? If Ty Cobb popped up in your mind you’re correct. In his 24 year career he totaled 4,189 career hits with a batting average of .366¹.

To put it in perspective in today’s baseball world, the 2014 Major League Baseball leader in batting average was .341². Failing 66% of the time made this individual the best hitter in baseball last year. Ty Cobb failed over 63% of his at-bats, and has earned the right to own the best batting average of all time.

Baseball is one of the prime examples of the importance of timing. A fastball traveling 90 mph takes approximately four-tenths of a second to get from the pitcher’s hand to the plate³. One split second can be the difference between hitting a homerun and striking out.

baseball

Over the past few months, the Consulting blog has provided multiple examples of what to consider with retirement plans during a merger or acquisition. While M&A situations typically don’t require split second decision making, timing can be a critical component towards putting your company and participants in the best position from a retirement plan perspective.

Why timing may be important to the employer?

  • Can determine what options exist for the retirement plan(s) involved in acquisition
  • Provide ample time for due diligence of the retirement plan(s) involved in acquisition
  • Plan design opportunities that may exist to better align with company’s goals and objectives
  • Documentation that may be needed to appropriately reflect what will happen after the merger or acquisition takes place

Why timing may be important to the employee?

  • During times of change, being proactive with clear and concise communication with the employees can help the transition run much smoother
  • Provide appropriate opportunities for the employee to understand how the merger or acquisition will affect their retirement plan funds and what options they may have to continue to work towards a more financially successful future

Timing is part of what makes baseball such a unique and difficult game to play. With the difficulty timing presents in baseball, the amount of success for hitters is very minimal. In a merger and acquisition situation, being proactive can help minimize the difficulty timing can create. Getting the expertise for retirement plan design prior to the merger and acquisition can help the employer work through not only the options available, but also the timing considerations to help make a smooth transition for both the employer and employees.

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¹Baldwin, D. (2009, 09 17). Unraveling the Batter’s Brain. Retrieved 06 19, 2015, from Baseball Analysts: http://baseballanalysts.com/archives/2009/09/unraveling_the.php

²ESPN.com. (2015, 06 22). MLB Career Batting Leaders. Retrieved 06 22, 2015, from ESPN.com: http://espn.go.com/mlb/history/leaders

³ESPN.com. (2015, 06 22). MLB Statistics – 2014. Retrieved 06 22, 2015, from ESPN.com: http://espn.go.com/mlb/statistics/_/year/2014

 

The subject matter in this communication is provided with the understanding that The Principal® is not rendering legal, accounting, or tax advice.  You should consult with appropriate counsel or other advisors on all matters pertaining to legal, tax, or accounting obligations and requirements.

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t15062301lp – 7/2015