Newsdash Insight on Plan Design & Investment Strategy from PLANSPONSOR
August 24th, 2016
Benefits & Administration
Americans of All Ages Worried About Retirement
Americans of all ages are worried about having enough money to fund their retirement, according to research by the Transamerica Center for Retirement Studies. Forty-five percent of Baby Boomers expect their standard of living will decrease in retirement, 83% of Generation X think their generation will have a harder time achieving financial security than their parents, and only 18% of Millennials are very confident about their future retirement.Read more >
Participants Could Use Managed Account Education
Fidelity Investments conducted a survey to find out why retirement plan participants value managed accounts and found that 48% appreciate the ongoing monitoring of their investments and 44% like the annual review. However, more education about managed accounts is clearly needed, as 39% who don’t use a managed account say they do not know how they work and 25% said not knowing enough about them is a major barrier to adoption. Once it is explained what a managed account is, 52% say it would be relevant to their needs and 52% say they would find the service useful. Read more >
Ask the Experts
Does the SECURE 2.0 Act Make 403(b) Plans More Like 401(k) Plans?
What Can Annuities Gain From Secure 2.0 Act?
25 States Bring Suit Against ESG Regulation
2016 Stock Plan Administration Buyer's Guide
Equity compensation can be an indispensable business tool, creating long-term value for both public and private companies, but its prominence within an employer’s total compensation strategy has been somewhat diluted since market volatility began taking root. A contracting market has created a strong competitive environment, which has resulted in stock plan administrators employing extremely complex platforms to track operations. There has also been much innovation in awards design, including a major decrease in the number of options granted—and missing in other types of equity; more performance-based awards; and the shortening of the life of a grant. These changes combine to make the selection of a stock plan administrator by a plan sponsor that much more important. Plan sponsors involved in such a decision may find value in this year’s recently-published PLANSPONSOR Stock Plan Administration Buyer’s Guide. Read more >
Market Mirror
Yesterday, the Dow closed up 17.88 points (0.10%) at 18,547.30, the NASDAQ gained 15.47 points (0.30%) to finish at 5,260.08, and the S&P 500 was up 4.68 points (0.21%) at 2,187.32. The Russell 2000 increased 8.74 points (0.70%) to 1,248.48, and the Wilshire 5000 climbed 51.26 points (0.23%) to 22,719.47.

On the NYSE, 3 billion shares traded, with advancing issues leading declining issues 2 to 1. On the NASDAQ, 2.7 billion shares changed hands, with a 2 to 1 lead of advancers over decliners.

The price of the 10-year Treasury note decreased 2/32, bringing its yield to 1.548%. The price of the 30-year Treasury bond rose 3/32, decreasing its yield to 2.232%. 

Sponsored message from SEI
A Changing Landscape Requires a New Approach: DC Discretion
A changing DC landscape: Sponsors consider discretionary investment management. Why the shift? Read more >
Ask the Experts
Ask the Experts – Excluding Temporary Employees
“I work with a 501(c)(3) tax-exempt that sponsors a 403(b) plan. The entity employs a large number of temporary workers since the entity engages in a lot of project-related work for which it receives specific funding. The workers in question generally lose their jobs in six months when the project is over, though of course they can work on projects in the future. The work is full-time, so the “normally works less than 20 hours per week “exemption form the universal availability requirement would not work (the vast majority of such employees are expected to work more than 1,000 hours). Is there any way to exclude these employees from the right to make elective deferrals to the 403(b)? These employees are generally offsite and it is thus difficult to communicate with them regarding their right to make elective deferrals to the plan.” Read more >
Retirement Plans Driving Wider R6 Share Offerings
Institutional investors, including employer-sponsored retirement plans, are generating significant demand for inexpensive and transparent investment vehicles. One clear overall theme continuing this year has been the shift in assets to lower-cost share class offerings. Firms expect to see the biggest increase in use of I-shares, R6-shares, and/or a platform/wrap share class—64%, 55%, and 50%, respectively. Additionally, financial advisers report that while 23% of their 2015 practice sales came in A-shares, they expect to substantially increase their use of platform and institutional share classes this year and beyond.Read more >
Small Talk

ON THIS DATE: In 79 Mount Vesuvius erupted, killing approximately 20,000 people. The cities of Pompeii, Stabiae and Herculaneum were buried in volcanic ash. In 410, the Visigoths overran Rome. This event symbolized the fall of the Western Roman Empire. In 1456, the printing of the Gutenberg Bible was completed. In 1814, Washington, DC, was invaded by British forces that set fire to the White House and Capitol. In 1869, a patent for the waffle iron was received by Cornelius Swarthout. In 1891 Thomas Edison applied patents for the kinetoscope and kinetograph. In 1932 Amelia Earhart became the first woman to fly across the U.S. non-stop. The trip from Los Angeles, CA to Newark, NJ, took about 19 hours. In 1949 the North Atlantic Treaty Organization (NATO) went into effect. The agreement was that an attack against on one of the parties would be considered “an attack against them all.” In 1954 the Communist Party was virtually outlawed in the U.S. when the Communist Control Act went into effect. In 1968 France became the 5th thermonuclear power when they exploded a hydrogen bomb in the South Pacific. In 1975 Davey Lopes of the Los Angeles Dodgers set a major league baseball record when he stole his 38th consecutive base. In 1989 Pete Rose, the manager of the Cincinnati Reds, was banned from baseball for life after being accused of gambling on baseball. In 1989, the U.S. space probe, Voyager 2, sent back photographs of Neptune. In 1991 Russian President Mikhail Gorbachev resigned as the head of the Communist Party. In 1992, China and South Korea established diplomatic relations. In 1995 Microsoft’s “Windows 95” went on sale. In 2001, the remains of nine American servicemen killed in the Korean War were returned to the U.S. The bodies were found about 60 miles north of Pyongyang. In 2006, the planet Pluto was reclassified as a “dwarf planet” by the International Astronomical Union (IAU).

WEDNESDAY WISDOM:  “The brain is a wonderful organ; it starts working the moment you get up in the morning and does not stop until you get into the office.” -Robert Frost

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Editorial: Alison Cooke Mintzer


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