Newsdash Insight on Plan Design & Investment Strategy from PLANSPONSOR
August 11th, 2016
Benefits & Administration
Despite skyrocketing specialty pharmacy costs, overall health care benefit cost increases at large U.S. employers are expected to hold steady at 6% again in 2017, according to an annual survey by the National Business Group on Health (NBGH). This year’s open enrollment season will bring no major changes for many employees; however, they will see some changes to how health care is accessed and delivered.Read more >
While Republicans are more likely to have a retirement account than Democrats, one in five Americans of working age have no retirement savings regardless of party affiliation, “showing Americans as a whole are not well-prepared for their financial future,” according to a survey by Personal Capital. Only 8% selected retirement security as a top concern going into this year’s election.Read more >
All Generations Need Retirement Savings Knowledge
Baby Boomers, Gen Xers, and Millennials have the same top three areas where they feel they lack the most retirement savings knowledge or education, a study found.Read more >
Data and Research
Early Withdrawals Found to Exacerbate 401(k) Account Disparities Across Race, Gender
Final Fiduciary Rule Expected Soon
Ask the Experts
Are Roth Excess Deferrals Taxed Twice?
Paper or Web: Which Enrollment Process Should Employers Use?
Employers are not in touch with how their employees want to enroll in benefits, findings of a recent LIMRA survey suggest. Only 38% of surveyed employers think their employees want to use a computer to enroll, while more than one-quarter believe their employees still want to enroll through paper forms. However, a 2015 LIMRA study found that 68% of employees want to enroll in their benefits online or electronically and only 16% want paper enrollment forms.Read more >
401(k) Participants Want Help With Retirement Savings Decisions
In addition to wanting help with investing and retirement planning, 85% of 401(k) participants surveyed by Charles Schwab said they would use a financial wellness program if it were offered by their employer.Read more >
Market Mirror

Yesterday, the Dow lost 37.39 points (0.20%) to finish at 18,495.66, the NASDAQ closed 20.90 points (0.40%) lower at 5,204.58, and the S&P 500 was down 6.25 points (0.29%) at 2,175.49. The Russell 2000 decreased 8.47 points (0.69%) to 1,223.27, and the Wilshire 5000 fell 72.55 points (0.32%) to 22,566.71.

On the NYSE, 3.1 billion shares traded, with a slight lead for decliners. On the NASDAQ, 2.7 billion shares changed hands, with declining issues outnumbering advancing issues 2 to 1.

The price of the 10-year Treasury note increased 12/32, bringing its yield down to 1.509%. The price of the 30-year Treasury bond climbed 24/32, decreasing its yield to 2.231%.
Special Coverage
Auto-Feature Evolution Post-PPA and Beyond
Ten years out there is clearly a big push still unfolding in the retirement planning industry related to the expansion of automatic plan features enshrined in the Pension Protection Act of 2006 (PPA). Jim McCaughan, CEO of Principal Global Investors, suggests that plan features such as auto-enrollment and widespread use of automated asset-allocation solutions have been an important first step to improve retirement outcomes generally in the U.S., but in the 10 years since PPA, we’ve learned these features must be supplemented with education and other efforts around the basic rules of investing and saving.Read more >
DB Plan Funded Status 10 Years After PPA
The Pension Protection Act of 2006 had good intentions to get pension plans fully funded, but the market environment since the PPA’s passage has foiled such plans. Should the legislation be amended permanently?Read more >
You can find more of our special coverage of the Pension Protection Act’s 10-year anniversary through the rest of the month on our dedicated microsite.Read more >
After two consecutive quarters of declines starting in the second quarter of 2015, Northern Trust Universe data shows the second quarter of 2016 was the third consecutive quarter of positive returns for institutional asset owners, with plan sponsors gaining approximately 1.9% at the median.Read more >
Small Talk
ON THIS DATE: In 1874, a patent for the sprinkler head was given to Harry S. Parmelee. In 1877, the two moons of Mars were discovered by Asaph Hall, an American astronomer. He named them Phobos and Deimos. In 1896, Harvey Hubbell received a patent for the electric light bulb socket with a pull-chain. In 1934, Alcatraz, in San Francisco Bay, received federal prisoners for the first time. In 1975, the U.S. vetoed the proposed admission of North and South Vietnam to the United Nations. The Security Counsel had already refused to consider South Korea’s application. In 1984, Carl Lewis won his fourth gold medal in the 1984 Summer Olympics. In 1984, the Cincinnati Reds honored major league All-Star and Hall of Fame catcher Johnny Bench by retiring his uniform (#5). In 1992, in Bloomington, Minnesota, the Mall of America opened. It was the largest shopping mall in the United States.
SURVEY SAYS:  Studies show a number of reasons employees give for not saving, or not saving more, for retirement—things like paying off student loans, paying for children’s education expenses, or just not making enough. This week, I’d like to know what obstacles keep you from saving more for retirement? You may respond to this week’s survey by 6 p.m. Pacific time today.Read more >
Share the good news with a friend! Pass the NewsDash along—and tell your friends/associates they can sign up for their own copy.Read more >

Editorial: Alison Cooke Mintzer


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