Newsdash Insight on Plan Design & Investment Strategy from PLANSPONSOR
April 19th, 2017
Benefits & Administration
Employers offering generous benefits packages that provide flexibility of cost and choice continue to have an advantage over those that don’t, according to a new study by the Employee Benefit Research Institute (EBRI). When it comes to employee preferences, EBRI finds health benefits continue to stand as the most desired perk.  Read more >
Investors Lack Fiduciary Awareness
Financial Engines says it is abundantly clear that average Americans favor the implementation of new conflict of interest protections for the retirement plan investing industry. Only 50% of investors who work with a financial adviser are certain whether their adviser is a fiduciary, while 38% don’t know if their adviser is a fiduciary or not, according to a Financial Engines survey. Read more >
Women Prepare Better for the Unexpected
“Female decisionmakers are more likely to incorporate financial products that help accumulate assets to provide income for retirement, such as an annuity, into their financial plans than male decisionmakers,” a Lincoln Financial Group study found. Read more >
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Ask the Experts
“What is the current maximum permissible vesting schedule for employer contributions to a retirement plan? And is it the same for base (discretionary) and matching contributions?  I seem to recall that the maximum changed in recent years, but I am not certain.” Read more >
Economic Events

Privately-owned housing starts in March were at a seasonally adjusted annual rate of 1,215,000, the Census Bureau announced. This is 6.8% below the revised February estimate of 1,303,000, but is 9.2% above the March 2016 rate of 1,113,000. Single-family housing starts in March were at a rate of 821,000; this is 6.2% below the revised February figure of 875,000. The March rate for units in buildings with five units or more was 385,000.

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Market Mirror

Tuesday, the Dow lost 113.64 points (0.55%) to finish at
20,523.28, the NASDAQ was down 7.32 points (0.12%) at 5,849.47, and the S&P
500 decreased 6.82 points (0.29%) to 2,342.19. The Russell 2000 was virtually
unchanged at 1,361.89, and the Wilshire 5000 closed 50.69 points (0.21%) lower
at 24,421.72.

On the NYSE, 3.1 billion shares changed hands, and on the
NASDAQ, 2.9 billion shares traded, with a slight lead for declining issues on
both exchanges.

The price of the 10-year Treasury note increased 21/32,
bringing its yield down to 2.177%. The price of the 30-year Treasury bond
climbed 1 9/32, decreasing its yield to 2.846%.

Compliance
The Encouraging Employee Ownership Act would increase the cap on the amount of stock closely held companies can award employees before triggering certain Securities and Exchange Commission (SEC) reporting requirements. Read more >
Fiduciary Caused ESOP Participants To Overpay for Company Stock
A federal judge, presiding over a U.S. Department of Labor lawsuit, has found that First Bankers Trust Services Inc. breached its duties of prudence and loyalty to the participants of an employee stock ownership plan (ESOP) when it caused the plan to overpay for shares of the company’s stock. U.S. District Judge Michael A. Shipp of the U.D. District Court for the District of New Jersey awarded to the plan $9,485,000 (plus interest), subject to the reduction in a 2016 consent order against SJP Group Inc.’s CEO Vincent DiPano. Read more >
DC Plan Sponsors Have Until May 1 to Adopt Pre-Approved Plan
The Internal Revenue Service (IRS) has extended the deadline from Sunday, April 30, 2017, to Monday, May 1, 2017, for certain employers to adopt a defined contribution (DC) pre-approved plan and apply for a determination letter, if permissible, to help employers who want to convert their existing individually designed plan into a current defined contribution pre-approved plan based on the 2010 Cumulative List. Plan sponsors with individually designed plan documents may want to adopt a pre-approved plan since the elimination of the five-year remedial amendment cycles for individually designed plans. Read more >
Investing
Target-Date Fund Reviews a Top Priority for Plan Sponsors
Retirement plan consultants list reviewing target-date strategies as the top priority for their plan sponsor clients, according to the 11th annual PIMCO Defined Contribution Consulting Support and Trends Survey. The consultants surveyed also make recommendations for defined contribution plan fund lineups. Read more >
Small Talk

ON THIS DATE: In 1764, the English Parliament banned the American colonies from printing paper money. In 1770, Captain James Cook discovered New South Wales, Australia. Cook originally named the land Point Hicks. In 1775, the American Revolution began as fighting broke out at Lexington, Massachusetts. In 1782, The Netherlands recognized the new United States. In 1861, U.S. President Abraham Lincoln ordered a blockade of Confederate ports. In 1897, the first annual Boston Marathon was held. In 1933, U.S. President Franklin D. Roosevelt issued a proclamation that removed the U.S. from the gold standard. In 1939, Connecticut approved the Bill of Rights for the U.S. Constitution after 148 years. In 1960, baseball uniforms began displaying player’s names on their backs. In 1967, Surveyor 3 landed on the moon and began sending photos back to the U.S. In 1977, Alex Haley received a special Pulitzer Prize for his book “Roots.” In 1982, NASA named Guion S. Bluford Jr. as the first African-American astronaut. In 1982, the U.S. announced a ban on U.S. tourist and business travel to Cuba. The U.S. charged the Cuban government with subversion in Central America. In 1993, the Branch-Davidian’s compound in Waco, Texas, burned to the ground. It was the end of a 51-day standoff between the cult and U.S. federal agents. Eighty-six people were killed including 17 children. Nine of the Branch Davidians escaped the fire. In 1995, the Alfred P. Murrah Federal Building in Oklahoma City was destroyed by a bomb. It was the worst bombing on U.S. territory. One hundred sixty-eight people were killed including 19 children, and 500 were injured.


WEDNESDAY WISDOM: “In the Spring, I have counted 136 different kinds of weather inside of 24 hours.”—Mark Twain

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Editorial: Alison Cooke Mintzer alison.mintzer@strategic-i.com

Advertising: Paul Zampitella paul.zampitella@strategic-i.com

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