Newsdash Insight on Plan Design & Investment Strategy from PLANSPONSOR
December 17th, 2015
Benefits & Administration
Participants Relying Less on Advisers
Forty-one percent of retirement plan participants younger than 35 are relying less on an adviser, according to a new report from Spectrem, “Advisor Usage Among DC Plan Participants.” Among those 35 to 49 years old, 33% are depending less on advisers. The trend continues among older investors, although it declines to 28% for those ages 50 to 64 and to 19% for those 65 and older. The report also reveals causes dissatisfaction with advisers.Read more >
“Premature distributions, cash-outs of retirement accounts, and defaults on loans are major sources of DC asset leakage and were responsible for outflows of nearly $81 billion in 2014,” states Shaan Duggal, research analyst at Cerulli Associates. Participants need help and a new mindset to preserve assets earmarked for retirement, a Cerulli report says.Read more >
New DOL Rule on ESG Investing in Retirement Plans Draws Republican-Led Legal Challenge
Deals and People
Retirement Industry People Moves
Ask the Experts
Does the SECURE 2.0 Act Make 403(b) Plans More Like 401(k) Plans?
Number of ESOPs Down, Number of Participants Up
The number of employee stock ownership plans (ESOPs) as of the end of 2013 was 6,795, with 10.6 million active plan participants and $1.23 trillion in plan assets, according to an analysis by the National Center for Employee Ownership (NCEO). The Center also reported statistics for ESOP-like plans.Read more >
More Firms Outsource Benefits Functions
The top two challenges facing benefits departments, by a wide margin, are compliance with benefits laws and regulations (73%) and rising health care costs (52%). By outsourcing certain functions, more time can be spent on addressing these key challenges, which creates a positive balance for companies, the International Foundation of Employee Benefit Plans says.Read more >
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Economic Events
Privately-owned housing starts in November were at a seasonally adjusted annual rate of 1,173,000, according to the Census Bureau. This is 10.5% above the revised October estimate of 1,062,000 and is 16.5% above the November 2014 rate of 1,007,000. Single-family housing starts in November were at a rate of 768,000; this is 7.6% above the revised October figure of 714,000. The November rate for units in buildings with five units or more was 398,000.
Market Mirror

Major U.S. stock indices closed higher after the Federal Reserve nudged interest rates higher for the first time in nine years, a vote of confidence in the U.S. economy, the Associated Press reports. The Dow gained 224.18 points (1.28%) to finish at 17,749.09, the NASDAQ closed 75.78 points (1.52%) higher at 5,071.13, and the S&P 500 increased 29.65 points (1.45%) to 2,073.06. The Russell 2000 was up 17.42 points (1.54%) at 1,148.97, and the Wilshire 5000 climbed 304.25 points (1.45%) to 21,256.03.

On the NYSE, 3.2 billion shares changed hands, with advancing issues outnumbering declining issues more than 4 to 1. On the NASDAQ, 2.7 billion shares traded, with a near 3 to 1 lead for advancers.

The price of the 10-year Treasury note decreased 8/32, bringing its yield up to 2.297%. The price of the 30-year Treasury bond fell 11/32, increasing its yield to 3.005%.
Budget Bill Will Not Delay Fiduciary Rule Process
Congress reached an agreement on a budget deal that did not include riders that would have changed the process of the Department of Labor’s proposal to change the definition of fiduciary advice under the Employee Retirement Income Security Act (ERISA). Several groups are concerned with where the proposal is heading, what’s in it and how fast it’s moving. One group wants to defund the DOL initiative, while another group is suggesting the DOL be required to re-propose the rule with a short comment period next year, which would impact the timing of the issuance and effective date of the rule and give interested parties an opportunity to see how the DOL is resolving concerns raised during the first comment period.Read more >
IRS Releases 2015 Cumulative List
The Internal Revenue Service (IRS) issued Notice 2015-84, containing the 2015 Cumulative List of Changes in Plan Qualification Requirements (2015 Cumulative List) described in section 4 of Rev. Proc. 2007-44. The 2015 Cumulative List is to be used by plan sponsors and practitioners submitting determination letter applications for plan documents during the period beginning February 1, 2016, and ending January 31, 2017.Read more >
For the first time since 2006, the Federal Reserve has raised interest rates at its quarterly meeting, after much anticipation and nail-biting. But not everyone is particularly moved by the quarter-percentage point increase, and this move—likely the first in a series of gradual raises—won’t make much difference to most investors, sources say.Read more >
Small Talk
ON THIS DATE: In 1777, France recognized American independence. In 1791, a traffic regulation in New York City established the first one-way street. In 1903, the first successful gasoline-powered airplane flight took place near Kitty Hawk, North Carolina. Orville and Wilbur Wright made the flight. In 1969, the U.S. Air Force closed its Project “Blue Book” by concluding that there was no evidence of extraterrestrial spaceships behind thousands of UFO sightings. In 1975, Lynette Fromme was sentenced to life in prison for her attempt on the life of U.S. President Ford. In 1976, WTCG-TV in Atlanta changed its call letters to WTBS, and was uplinked via satellite. The station became the first commercial TV station to cover the entire U.S. In 1992, U.S. President George H.W. Bush, Canadian Prime Minister Brian Mulroney and Mexican President Carlos Salinas de Gortari signed the North American Free Trade Agreement. In 2002, McDonald’s Corp. warned that it would report its first quarterly loss in its 47-year history.
SURVEY SAYS: Last year, I asked NewsDash readers what was their favorite holiday song. This year, I’m bringing back the holiday movie survey. You can select your favorite from our list or make your own selection. You can respond to this week’s survey by 6 p.m. Pacific time today.Read more >
Share the good news with a friend! Pass the Dash along – and tell your friends/associates they can sign up for their own copy.Read more >

Editorial: Alison Cooke Mintzer


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