Newsdash Insight on Plan Design & Investment Strategy from PLANSPONSOR
August 28th, 2017
Benefits & Administration
After Seven Years of Declining, DC Fees Remain Flat
Defined contribution (DC) plan fees—including recordkeeping, trust and custody fees—remained flat this year, NEPC found in a survey. The median fee per participant is $59, just a slight increase from $57 in 2016. This follows the previous seven years when the fees declined. In 2006, when NEPC first conducted this survey, the fees were $118. Read more >
‘Rothification’ of DC Plans Could Harm Participants
According to the Joint Committee on Taxation, defined contribution (DC) plans will have “cost” the federal government more than $580 billion in lost tax revenue by 2020. This figure is a big reason why retirement plan providers and their plan sponsor clients are concerned about the potential “Rothification” of 401(k) plans. Legislation to this effect could mandate that some or all contributions to workplace retirement plans be made on an after-tax basis, with qualified withdrawals becoming tax-free. While the concept can seem appealing to certain investors and improve outcomes in certain circumstances, some analysts believe that forcing the Roth approach on all savers will likely have negative consequences. Read more >
Products, Deals and People
Retirement Industry People Moves
OneAmerica Names West Coast Relationship Executive; Callan Names New CEO; John Hancock Retirement Names Taft Hartley Sales Manager; and more. Read more >
MOST READ ARTICLES
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House Committee Advances Bill to Establish Union Pension Lifeline Program
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The Senate Math That Could Block SECURE Act
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Adidas Sued Over Excessive Fees for 401(k) Participants
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Open MEPs Not for Every Plan Sponsor
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Employers Encouraged to Offer Multi-Dimensional Wellness Programs
Economic Events

New orders for manufactured durable goods in July decreased $16.7 billion or 6.8% to $229.2 billion, the U.S. Census Bureau announced. This decrease, down three of the last four months, followed a 6.4% June increase. Excluding transportation, new orders increased 0.5%. Excluding defense, new orders decreased 7.8%. Transportation equipment, also down three of the last four months, drove the decrease, $17.4 billion or 19.0% to $74.3 billion.

 

THE ECONOMIC WEEK AHEAD: Tomorrow, the Conference Board will reveal its Consumer Confidence Index for August. Thursday, the Labor Department will issue its initial claims report. Friday, the Bureau of Labor Statistics will reveal the unemployment rate for August.

Market Mirror

Friday, the Dow closed 30.27 points (0.14%) higher at 21,813.67, the NASDAQ was down 5.68 points (0.09%) at 6,265.64, and the S&P 500 was up 4.08 points (0.17%) at 2,443.05. The Russell 2000 increased 3.58 points (0.26%) to 1,377.45, and the Wilshire 5000 gained 50.95 points (0.20%) to finish at 25,334.83.

 

The price of the 10-year Treasury note was up 8/32, decreasing its yield to 2.169%. The price of the 30-year Treasury bond increased 16/32, bringing its yield down to 2.747%.

 

WEEK’S WORTH: For the week ending August 25, the Dow was up 0.64%, the NASDAQ finished 0.79% higher, and the S&P 500 increased 0.72%. The Russell 2000 climbed 1.45%, and the Wilshire 5000 gained 0.90%.

Compliance
EEOC Wellness Program Rule Lawsuit Decided in Favor of AARP
A new decision out of the U.S. District Court for the District of Columbia rules in favor of the AARP’s challenge to two regulations promulgated by the U.S. Equal Employment Opportunity Commission (EEOC) related to incentives and employer-sponsored wellness programs. Crucially, the court has determined that “It is far from clear that it would be possible to restore the status quo ante if the rules were vacated; rather, it may well end up punishing those firms—and employees—who acted in reliance on the rules.” As such the court has not vacated the rules but instead “remanded” them to the EEOC for reform and/or elucidation. Read more >
From the Magazine
Taking Responsibility
Many articles are missing the opportunity to tell Americans that in the past, people weren’t just relying on their employer to provide retirement security but were taking it upon themselves to save for their future. Read more >
Small Talk

ON THIS DATE: In 1907, “American Messenger Company” was started by two teenagers, Jim Casey and Claude Ryan. The company’s name was later changed to “United Parcel Service.” In 1922, the first radio commercial aired on WEAF in New York City. The Queensboro Realty Company bought 10 minutes of time for $100. In 1963, Dr. Martin Luther King, Jr., gave his “I Have a Dream” speech at a civil rights rally in Washington, D.C. In 1972, Mark Spitz captured the first of his seven gold medals at the Summer Olympics in Munich, Germany. He set a world record when he completed the 200-meter butterfly in 2 minutes and 7/10ths of a second. In 1995, the biggest bank in the U.S. was created when Chase Manhattan and Chemical Bank announced their $10 billion deal. In 1996, a divorce decree was issued for Britain’s Prince Charles and Princess Diana. In 2004, George Brunstad, at age 70, became the oldest person to swim the English Channel. The swim from Dover, England, to Sangatte, France, took 15 hours and 59 minutes.

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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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