Newsdash Insight on Plan Design & Investment Strategy from PLANSPONSOR
August 10th, 2018
Benefits & Administration
Financial Needs Top Reason Older Workers Employed or Looking for Work
More than one in 10 older workers (defined by the AARP as those ages 45 and older) (13%) report that they are retired but working or looking for work. “Need the money” (87%) and “to save more for retirement” (84%) are the most commonly selected reasons older workers are working or looking for work, and 9% indicated they need to maintain their health insurance, according to an AARP study. Read more >
Wage Inequality Will Exacerbate Retirement Income Inequality
If the hourly wage gap between college and high school graduates continues to grow at its current pace, the impact would reverberate into retirement, because Social Security benefits are tied to lifetime earnings, and how much people can save for retirement depends on how much they earn, researchers for the Urban Institute conclude. The researchers’ projections show that mean income at ages 67 to 75, measured broadly to account for the value of owner-occupied housing and retirement savings and excluding tax and Medicare premium payments, would increase in the top fifth of the lifetime income distribution by 3% in 2045, 5% in 2065, and 7% in 2085. However, in the bottom fifth of the distribution, retirement income would fall by 3% in 2045, 6% in 2065, and 13% in 2085. Read more >
Equity Returns Pull Average Pension Funded Ratios Up in July
Defined benefit (DB) plan funded status reached a five-year high in July. Companies that estimate funded status for defined benefit (DB) plans say this is due to equity returns, as interest rates remained relatively flat. Read more >
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Products, Deals and People
Mercer Offers Framework and Scorecard for Improving Employer Health Benefits
Mercer’s Vitals for Change framework calls on employer health plan sponsors to demand more for their employees and their families in four key areas that target systemic problems in the health care system and drive positive disruption and innovation. Read more >
Investment Product and Service Launches
Lincoln Financial creates personalized target-date portfolios; Aon Hewitt-managed pooled funds claim compliance with GIPS; Vanguard launches Global Credit Bond Fund; and more. Read more >
Economic Events

June sales of merchant wholesalers, except manufacturers’ sales branches and offices, after adjustment for seasonal variations and trading-day differences but not for price changes, were $506.7 billion, down 0.1% from the revised May level, but up 10.2% from the June 2017 level, the Census Bureau reported. The April to May percent change was revised from the preliminary estimate of up 2.5% to up 2.1%.

The Producer Price Index for final demand was unchanged in July, as prices for final demand goods edged up 0.1%, and the index for final demand services declined 0.1%, the Bureau of Labor Statistics revealed. The final demand index increased 3.3% for the 12 months ended in July.

In the week ending August 4, the advance figure for seasonally adjusted initial claims for unemployment insurance was 213,000, a decrease of 6,000 from the previous week’s revised level of 219,000, the Labor Department reported. The four-week moving average was 214,250, a decrease of 500 from the previous week’s revised average of 214,750.

The average interest rate for a 30-year fixed-rate mortgage is 4.59%, down from 4.60% one week ago, according to Freddie Mac. The average interest rate for a 15-year fixed-income mortgage is 4.05%, down from 4.08%.

Market Mirror

Thursday, the Dow closed 74.52 points (0.29%) lower at 25,509.23, the NASDAQ was up 3.46 points (0.04%) at 7,891.78, and the S&P 500 decreased 4.12 points (0.14%) to 2,853.58. The Russell 2000 increased 4.01 points (0.24%) to 1,690.89, and the Wilshire 5000 was down 11.78 points (0.04%) at 29,747.47.

The price of the 10-year Treasury note increased 12/32, bringing its yield down to 2.923%. The price of the 30-year Treasury bond climbed 26/32, decreasing its yield to 3.070%.

Small Talk

ON THIS DATE: In 1821, Missouri became the 24th state to join the Union. In 1846, The Smithsonian Institution was chartered by the U.S. Congress. The “Nation’s Attic” was made possible by $500,000 given by scientist Joseph Smithson. In 1869, the motion picture projector was patented by O.B. Brown. In 1914, Austria-Hungary invaded Russia. In 1921, Franklin D. Roosevelt was stricken with polio. In 1927, Mount Rushmore was formally dedicated. The individual faces of the presidents were dedicated later. In 1944, U.S. forces defeated the remaining Japanese resistance on Guam. In 1945, the day after the atomic bombing of Nagasaki, Japan announced they would surrender. The only condition was that the status of Emperor Hirohito would remain unchanged. In 1948, on ABC, “Candid Camera” made its TV debut. In 1949, in the U.S., the National Military Establishment had its name changed to the Department of Defense. In 1973, Arnold Palmer did not make the cut for the final two rounds of the PGA Golf Championship. It was the first time in his career. In 1981, Pete Rose hit a single and broke the National League all-time hit record with his 3,631st hit. In 1988, President Ronald Reagan signed a measure that provided $20,000 payments to Japanese-Americans who were interned by the U.S. government during World War II. In 1995, Norma McCorvey, “Jane Roe” of the 1973 U.S. Supreme Court decision legalizing abortion, announced that she had joined the anti-abortion group Operation Rescue.

And now it’s time for FRIDAY FILES!

So many things can go wrong at weddings. Read more >
One of the fun things about being a parent is embarrassing your children. Read more >
Ways people rig things to work. Read more >

In St. Petersburg, Florida, a man banned from a 7-Eleven set out for revenge. He is accused of dumping a bucket containing human fe.ces and ur.ine inside the store. According to The Smoking Gun, he “apparently obtained the waste from a portable toilet.” The man was identified by the store manager from store surveillance and was charged with trespass and criminal mischief.

In Texarkana, Arkansas, a teen needed a ride to an out-of-state concert, so he jumped the fence at the city’s regional airport and hopped inside an American Eagle jet. He was inside the cockpit when he was arrested. According to the Associated Press, he told police he thought piloting the plane would involve little more than pushing buttons and pulling levers.

In Sanford, Florida, a woman fleeing police got out of her car and ran through a pasture. But, police had help capturing her. According to the Associated Press, a Seminole County Sheriff’s helicopter captured video of a large group of cows following her. The cows eventually ran the woman into a fence, where police were waiting to arrest her.

In Japan, a long-wedded couple has just been granted a Guinness world record. It has just declared the couple as its oldest living married couple. Masao Matsumoto, 108, and his 100-year-old bride, Miyako Sonoda, were married October 20, 1937, nearly 81 years ago.

In Swampscott, Massachusetts, Construction crews tearing down a former middle school in Massachusetts found a 124-year-old time capsule under one of the front steps of the former Swampscott Middle School. The Daily Item reports the capsule is dated April 28, 1894, the day the school was dedicated. It contains two newspapers, remnants of military uniforms from the Civil War, a war medal and names of locals who served in the war. Planning Board Chairwoman Angela Ippolito says the board hopes to put the items on display at Town Hall.

 

Hope you all have a happy weekend!

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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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