| Benefit Briefs | A New Employee Benefit Is Evolving: Financial Wellness | Employee financial education is moving from a
product-driven model to a true planning model. “When I first started [in this
business], there was a model of financial education in which financial planners
were focused on capturing assets and the investing strategies for those assets,
so the business was focused on those with higher incomes and assets to invest,”
noted Linda Robertson, certified financial planner with Financial Finesse,
during a webcast hosted by the firm. “Most employees were financially stressed
and so they were not targeted for financial planning. They had no help with
basic financial and savings habits.” According to Robertson, financial wellness
is becoming a new employee benefit. | Focus on DC Plan Benefits Renewed | Rebounding from the economic downturn of
2008/2009, retirement plan participants and plan sponsors are renewing their
focus on their retirement benefits. According to Deloitte’s 13th Annual Defined
Contribution Benchmarking Survey, a more stable economy and job market helped
remove a degree of employee anxiety about setting aside money for the future.
The research underlying the survey found average defined contribution (DC) plan
account balances have reached an all-time high of more than $95,000, up from
$85,600 in 2012. Survey results also show an increased number of employees are
participating in defined contribution plans, with participation jumping 6
percentage points (77% in 2013 vs. 71% in 2012). Companies are also showing
renewed confidence in the economy and taking steps to make DC plans more accessible
and attractive to employees. For example, immediate eligibility for matching
contributions increased to 62% in 2013, up 6% from 2012. Unlike previous
surveys, no plan sponsors indicated a suspended or discontinued company match. | As more state and local governments reform
pensions following the recession, public sector employees have more concerns
about retirement. A new report released by the Center for State and Local
Government Excellence and the TIAA-CREF Institute finds only 18% of full-time
public-sector workers are very confident about their retirement income
prospects, down from 21% in 2012. In particular, many public-sector workers
also express concern about retiree health care costs, future benefits from
Social Security and Medicare, and their own saving and investing for
retirement. | HR, Finance See DC Plan Issues Similarly | We looked at how human resource (HR) and finance
executives responded to subjective questions posed in PLANSPONSOR’s annual
Defined Contribution (DC) Survey. For this exercise, we fully expected to see
differences in how these two groups of professionals view aspects of retirement
plan recordkeepers and fees, as well as each group’s confidence that employees
will achieve their retirement goals. We were quite surprised. | | Market Mirror | Wednesday, the Dow was up 59.54 points
(0.35%) at 16,979.13, the NASDAQ decreased by 1.03 (0.02%) to 4,526.48, and the
S&P 500 closed 4.91 points (0.25%) higher at 1,986.51. The Russell 2000
fell 4.96 points (0.43%) to 1,157.51, and the Wilshire 5000 increased 42.32
points (0.20%) to 21,031.55.
On the NYSE, 3.2 billion shares traded,
with a slight lead for advancers. On the NASDAQ, 2.8 billion shares changed
hands, with 1.7 declining issues for every advancing issue.
The price of the 10-year Treasury note fell 8/32,
bringing its yield up to 2.430%. The price of the 30-year Treasury bond was
down 2/32, increasing its yield to 3.218%.
| | Rules & Regulators | English-Language SPDs May Not Violate ERISA | A court has dismissed a claim that a company
violated federal law by not sending a Spanish-language retirement plan document
to Hispanic participants. U.S. District Judge Ellen Lipton Hollander of the
U.S. District Court for the District of Maryland, noted that the Employee
Retirement Income Security Act (ERISA) provides: “A summary plan description of
any employee benefit plan shall be furnished to participants and
beneficiaries…” and the “summary plan description … shall be written in a
manner calculated to be understood by the average plan participant.” The
plaintiffs in the case claim that the “average participant in the Defendant
Plan speaks and reads Spanish as his primary language, and requires translation
assistance with reading or speaking English.” | Summaries of the latest from Washington and the
courts—what’s coming, what’s contemplated and what’s critical to plan sponsors. | DOL Wants Input About Brokerage Windows in DC Plans | The U.S. Department of Labor (DOL) issued a
request for information (RFI) about the use of brokerage windows, self-directed
brokerage accounts, and similar features in 401(k)-type retirement plans. The
DOL says it received a significant number of questions and comments about
brokerage windows following the 2012 publication of a final regulation on
participant-level fee disclosure, and so it is now considering whether to
update rules related to brokerage windows. | | Small Talk | ON THIS DATE: In 1841,
a patent for venetian blinds was issued to John Hampton. In 1878, the American Bar Association was
formed by a group of lawyers, judges and law professors in Saratoga, New York.
In 1888, the adding machine was
patented by William Burroughs. In 1959,
Hawaii became the 50th state. U.S. President Eisenhower also issued the order
for the 50 star flag. In 1984, Clint
Eastwood was given a star on the Hollywood Walk of Fame. In 1996, the Health Insurance Portability
and Accountability Act (HIPAA) was signed by U.S. President Clinton. The act
made it easier to obtain and keep health insurance. In 1997, Cicely Tyson received a star on the Hollywood Walk of Fame.
In 1998, Wesley Snipes received a star
on the Hollywood Walk of Fame. | SURVEY SAYS: I
recently told someone with which I used to work that when I was hired by that
employer 24 years ago, I believed I would work there until I retired. Since
then, I have been sold, merged, and bought, and moved myself to a new employer.
A survey we covered in June found by age 35, 25% of workers have held five jobs
or more. For workers ages 55 and older, 20% have held 10 jobs or more. This
week, I’d like to know, for how many employers have you worked? Do you expect
your current employer to be the one from which you retire? Did you start out in
a retirement plan-related field? You may respond to this week’s survey by 6
p.m. Pacific time today. | Share the good news with a friend! Pass the Dash along – and tell your
friends/associates they can sign up for their own copy. | News from PLANSPONSOR.com
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