Newsdash Insight on Plan Design & Investment Strategy from PLANSPONSOR
April 20th, 2017
Benefits & Administration
Participants Must Be ‘Nudged’ Toward Higher Savings Rates
New research by Morningstar suggests defined contribution (DC) plan sponsors may benefit from increasing default savings rates, relying on opt-out auto escalation features, and stretching the employer match. Read more >
ICI Measures Adequate Income Replacement
Most American workers maintain or increase their spendable income after claiming Social Security, according to a new analysis of tax data by Investment Company Institute economists Peter Brady and Steven Bass. Findings show Social Security benefits and retirement income from employer-sponsored retirement plans, annuities, and individual retirement accounts (IRAs) together provide substantial income for U.S. retirees. Read more >
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Adidas Sued Over Excessive Fees for 401(k) Participants
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Yale Sued Over Wellness Program ‘Penalty’
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Employees in Two States Miss Out on One HSA Benefit
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Some Help for Women’s Retirement Savings Gap May Be Coming
Not-for-Profit Plan Sponsor Strategies to Meet Challenges
More than half, or 59%, of not-for-profit plan sponsors are concerned that their participants will run out of money in retirement, and 69% worry employees will delay retirement because they don’t have enough money, according to a survey by TIAA. However, the research also points to various strategies sponsors can adopt to address these concerns, including taking advantage of in-plan lifetime income solutions. More effective and targeted communications can also help. Read more >
Products, Deals and People
Anthem has entered into an agreement with Alegeus, provider of consumer-directed health care (CDH) solutions, to serve as the preferred partner to power the CDH programs of Anthem’s affiliated health plans. The Alegeus platform will provide robust engagement tools that help consumers optimize their health care spending and maximize their health care savings. Read more >
Market Mirror

Wednesday, the Dow lost 118.79 points (0.58%) to finish at 20,404.49, the NASDAQ increased 13.56 points (0.23%) to 5,863.03, and the S&P 500 was down 4.02 points (0.17%) at 2,338.17. The Russell 2000 was up 5.24 points (0.38%) at 1,367.13, and the Wilshire 5000 decreased 24.48 points (0.10%) to 24,397.24.

On the NYSE, 3.1 billion shares traded, with a slight lead for declining issues. On the NASDAQ, nearly 3.0 billion shares changed hands, with 3 advancing issues for every 2 declining issues.

The price of the 10-year Treasury note was down 11/32, increasing its yield to 2.215%. The price of the 30-year Treasury bond decreased 20/32, bringing its yield up to 2.871%.

Compliance
IRS Examiners Told to Look at Cash Balance Plan Benefit Formulas
A memo offers examples and would be a helpful guide for cash balance plan sponsors to assess whether their plan offers definitely determinable benefits. Read more >
Industry Voices
Managing Pension Risks Comes at a Cost
When it comes to many financial decisions, there’s no such thing as a free lunch. It’s especially true for pension risk management. Lately, the market buzz is about reducing pension risk (high and/or volatile accounting results) in favor of greater financial stability. To reason otherwise feels like arguing against “Mom and apple pie.”  But you don’t simply elect stability; you pay for it in some way. Often, the cost is well worth the risk reduction tradeoff (as is the case with buying insurance). However, if anyone is presenting these strategies as cost free, be cautious and probe further. Read more >
Small Talk

ON THIS DATE: In 1775, American troops began the siege of British-held Boston. In 1832, Hot Springs National Park was established by an act of the U.S. Congress. It was the first national park in the U.S. In 1836, the U.S. territory of Wisconsin was created by the U.S. Congress. In 1861, Robert E. Lee resigned from U.S. Army. In 1902, scientists Marie and Pierre Curie isolated the radioactive element radium. In 1912, Fenway Park opened as the home of the Boston Red Sox. In 1916, Chicago’s Wrigley Field held its first Cubs game with the first National League game at the ballpark. The Cubs beat the Cincinnati Reds 7-6 in 11 innings. In 1940, the first electron microscope was demonstrated by RCA. In 1945, during World War II, Allied forces took control of the German cities of Nuremberg and Stuttgart. In 1953, Operation Little Switch began in Korea. It was the exchange of sick and wounded prisoners of war. Thirty Americans were freed. In 1961, FM stereo broadcasting was approved by the FCC. In 1972, the manned lunar module from Apollo 16 landed on the moon. In 1988, the U.S. Air Force’s Stealth (B-2 bomber) was officially unveiled. In 1999, Jane Seymour received a star on the Hollywood Walk of Fame.

SURVEY SAYS: I feel blessed to be able to work from home, but there are some downsides to it also. This week, I’d like to know, if you worked from home all the time, what do you think would be the negatives of doing so? You may respond to this week’s survey by 6 p.m. Pacific time today. Read more >
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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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