Newsdash Insight on Plan Design & Investment Strategy from PLANSPONSOR
December 15th, 2016
Benefits & Administration
Across all income groups, retirees are collecting more in retirement income from employer sponsored retirement plans today than they were in the mid-1970s, according to a new report by the Investment Company Institute (ICI). The study found that the share of retirees with private-sector pension income nearly doubled between 1975 and 2015. Moreover, the median income received by people with private-sector retirement income is up by more than 50%. Read more >
Retirement Confidence Recovering from Great Recession
Retirement confidence has recovered since the Great Recession, according to research from the Transamerica Center for Retirement Studies. Sixty-two percent of workers are confident that they will be able to fully retire with a comfortable lifestyle, including 15% who are “very confident” and 47% who are “somewhat confident.” However, workers cited retirement fears, such as “outliving my savings/investments” (51%), “Social Security will be reduced or cease to exist in the future” (47%) and “declining health that requires long-term care” (45%). Read more >
MOST READ ARTICLES
1
AT&T Sued Over Calculation of Early Retirement Benefits
2
Congressional Leaders Want SECURE Act Passage in 2019
3
New Lawsuit Highlights Importance of Cybersecurity for Retirement Plans
4
IRS Releases 2019-2020 Priority Guidance Plan
5
DC Plans 3.0 Will Really be Tailored to Individual Situations
403(b) Plan Sponsors Taking Action to Prepare for Fiduciary Rule
While 59% are making no changes, others are re-evaluating adviser choices, reviewing investment lineups and reviewing plan governance structure. Read more >
Products, Deals and People
Morningstar’s HelloWallet platform has released a new financial wellness tool to help people decide when to allocate money to retirement savings and when to pay off student loans. Read more >
Offered for both multiemployer and single-employer benefit plans, the Segal Group has published a set of calendars that summarize annual compliance requirements and disclosure obligations necessary for health and retirement plan sponsors to know. Read more >
Economic Events

The U.S. Census Bureau announced that the combined value of distributive trade sales and manufacturers’ shipments for October, adjusted for seasonal and trading-day differences but not for price changes, was estimated at $1,326.8 billion, up 0.8% from September and up 2.1% from October 2015.

Advance estimates of U.S. retail and food services sales for November, adjusted for seasonal variation and holiday and trading-day differences, but not for price changes, were $465.5 billion, an increase of 0.1% from the previous month, and 3.8% above November 2015. Total sales for the September through November period were up 3.7% from the same period a year ago.

The Producer Price Index (PPI) for final demand increased 0.4% in November, according to the Bureau of Labor Statistics. Final demand prices were unchanged in October and rose 0.3% in September. In November, the final demand services index advanced 0.5% and prices for final demand goods moved up 0.2%.

Market Mirror

Wednesday, the Dow decreased 118.68 points (0.60%) to 19,792.53, the NASDAQ was down 27.16 points (0.50%) at 5,436.67, and the S&P 500 lost 18.44 points (0.81%) to finish at 2,253.28. The Russell 2000 fell 17.51 points (1.27%) to 1,356.02, and the Wilshire 5000 closed 201.02 points (0.85%) lower at 23,544.17.

On the NYSE, 3.1 billion shares traded, with declining issues outnumbering advancing issues more than 4 to 1. On the NASDAQ, 2.9 billion shares changed hands, with a near 3 to 1 lead for decliners.

The price of the 10-year Treasury note decreased 27/32, bringing its yield up to 2.574%. The price of the 30-year Treasury bond fell 1 1/32, increasing its yield to 3.187%.

Compliance
Representative Johnson Proposes Social Security Reform
House Ways and Means Social Security Subcommittee Chairman Representative Sam Johnson (R-Texas) introduced legislation he says will permanently save Social Security. The legislation would increase the full retirement age for claiming benefits, among other things. Read more >
IRS Releases Required Amendments List for Qualified Plans
In Notice 2016-80, the Internal Revenue Service (IRS) provides the Required Amendments List for 2016 (2016 RA List). In June, the IRS issues Revenue Procedure 2016-37, which eliminates, as of January 1, 2017, the five-year remedial amendment cycle system for individually designed plans that was set forth in Rev. Proc. 2007-44. Section 9 of Rev. Proc. 2016-37 provides that the Department of the Treasury and the IRS intend to publish annually an RA List. Read more >
From the Magazine
An Eye on Plan Forfeitures
Plan sponsors often impose vesting requirements on employer contributions to a defined contribution (DC) plan. If an employee terminates employment before becoming fully vested and takes a distribution, this generally results in a forfeiture of some or all of the employer contributions. Unfortunately, plan sponsors routinely fail to do anything with such forfeitures. Read more >
Small Talk

ON THIS DATE: In 1791, in the U.S., the first ten amendments to the Constitution, known as the Bill of Rights, went into effect following ratification by the state of Virginia. In 1854, in Philadelphia, the first street cleaning machine was put into use. In 1877, Thomas Edison patented the phonograph. In 1890, American Sioux Indian Chief Sitting Bull and 11 other tribe members were killed in Grand River, South Dakota, during an incident with Indian police working for the U.S. government. In 1938, U.S. President Franklin D. Roosevelt presided over the ground-breaking ceremonies for the Jefferson Memorial in Washington, D.C. In 1939, “Gone With the Wind,” produced by David O. Selznick based on the novel by Margaret Mitchell, premiered at Loew’s Grand Theatre in Atlanta. In 1966, Walter Elias “Walt” Disney died in Los Angeles at the age of 65. In 1978, U.S. President Jimmy Carter announced he would grant diplomatic recognition to Communist China on New Year’s Day and sever official relations with Taiwan. In 1997, the San Francisco 49ers retired Joe Montana’s number 16 during halftime of a game against the Denver Broncos. In 2000, the Chernobyl atomic power plant in Kiev, Ukraine, was shut down.

SURVEY SAYS: We recently covered a survey about embarrassing manager behaviors at office holiday parties. This week, I’d like to know, have you had or witnessed an embarrassing moment at an office holiday party? Please share those moments. 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 alison.mintzer@strategic-i.com

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