Newsdash Insight on Plan Design & Investment Strategy from PLANSPONSOR
December 4th, 2017
Webcast Event
Join PLANSPONSOR and industry experts tomorrow for the webcast, Innovating to Address the Unarticulated Needs of Participants, in which they’ll discuss: the next frontier in qualified default investment alternatives (QDIAs); investment vehicles, including the emergence of health savings accounts (HSAs) and the resurging of collective investment trusts (CITs); and the notion of a “Retirement Tier”, which includes tools and advice, targeted communications, investment options and plan design changes to meet the widely varying needs of participants approaching retirement. Read more >
Benefits & Administration
Recession Has Prompted Millennials to Be Financially Conservative
Having come of age when the Great Recession of 2008 broke, Millennials are taking a conservative and proactive approach to their finances, according to the latest Merrill Edge Report. Eighty-five percent of Millennials said they want to play it safe with their day-to-day investments. By comparison, 46% of Millennials’ parents characterize themselves as financially conservative, while 35% of their grandparents do. Read more >
MOST READ ARTICLES
1
SECURE Act Passes House, Bringing Calls for Senate Collaboration
2
J.P. Morgan Agrees to Settle Stable Value Funds Suit
3
Individuals, Employers and Government All Play a Part in Retirement Readiness
4
Participant Loans: A Fiduciary Storm Brewing?
5
What to Know About Financial Audits Filed with Form 5500s
Products, Deals and People
Retirement Industry People Moves
T. Rowe Price Names Senior DC Specialist; Vanguard Rotates Portfolio Managers; American Century Preps for Major ETF Business Launch; and more. Read more >
Economic Events

Construction spending during October was estimated at a seasonally adjusted annual rate of $1,241.5 billion, 1.4% above the revised September estimate of $1,224.6 billion. The October figure is 2.9% above the October 2016 estimate of $1,206.6 billion, the Census Bureau announced. During the first 10 months of this year, construction spending amounted to $1,029.6 billion, 4.1% above the $988.8 billion for the same period in 2016. 

 

THE ECONOMIC WEEK AHEAD: Today, the Census Bureau will report about factory orders for October. Thursday, the Labor Department will issue its initial claims report. Friday, the Bureau of Labor Statistics will reveal the unemployment rate for November, and the Census Bureau will report about wholesale trade for October.

Sponsored message from Natixis
Helping Make Retirement More Personal
82% of plan participants surveyed, would like their personal values reflected in their investments. Now there’s a solution that meets this demand: Natixis Sustainable Future Funds, the industry’s first ESG-driven target date funds. 1836098.1.1 Read more >
Market Mirror

Friday, the Dow lost 40.76 points (0.17%) to finish at 24,231.59, the NASDAQ closed 26.39 points (0.38%) lower at 6,847.59, and the S&P 500 was down 5.36 points (0.20%) at 2,642.22. The Russell 2000 decreased 7.12 points (0.46%) to 1,537.02, and the Wilshire 5000 fell 45.37 points (0.17%) to 27,448.01.

 

The yield for the 10-year Treasury note was 2.363%. The yield for the 30-year Treasury bond was 2.763%.

 

WEEK’S WORTH: For the week ending December 1, the Dow climbed 2.86%, the NASDAQ was down 0.60%, and the S&P 500 gained 1.53%. The Russell 2000 increased 1.18%, and the Wilshire 5000 finished 1.44% higher.

Compliance
House Bill Seeks Expansion of Open MEPs, Aggressive Plan Designs
In addition to removing the “one bad apple” rule and the commonality requirement for open multiple employer plan (MEPs), the bill includes various provisions to promote higher rates for automatic enrollment and more aggressive automatic deferral escalation. Read more >
From the Magazine
Reversing the Search
Researchers with J.P. Morgan Asset Management recently sat down with PLANSPONSOR editors to discuss the firm’s new case study, “Reverse the Search.” The release of the research coincided with the publication of the 2017 PLANSPONSOR Recordkeeping Survey, and the two together offer some important food for thought for plan sponsors entering the request for proposals (RFP) process. Read more >
Investing
Sponsors Must Weigh Response To Record-Breaking Equity Markets
For retirement plan sponsors and participants, perhaps less important than this 686-basis point performance spread for the preceding year is the associated shift in portfolio weights that come along with varied asset class performance across different exposures in the portfolio. Just like market lows, market highs should reinforce the importance of regular risk reviews and portfolio rebalancing. Read more >
Small Talk

ON THIS DATE: In 1812, Peter Gaillard patented the power mower. In 1918, U.S. President Woodrow Wilson set sail for France to attend the Versailles Peace Conference. Wilson became the first chief executive to travel to Europe while in office. In 1942, U.S. President Franklin D. Roosevelt ordered the dismantling of the Works Progress Administration. The program had been created in order to provide jobs during the Great Depression. In 1945, the U.S. Senate approved American participation in the United Nations. In 1965, the U.S. launched Gemini 7 with Air Force Lt. Col. Frank Borman and Navy Comdr. James A. Lovell on board. In 1973, Pioneer 10 reached Jupiter. In 1986, both U.S. houses of Congress moved to establish special committees to conduct their own investigations of the Iran-Contra affair. In 1991, Associated Press correspondent Terry Anderson was released after nearly seven years in captivity in Lebanon. In 1991, Pan American World Airways ceased operations.

SURVEY SAYS RESPONSES: Last week, I asked NewsDash readers, “Does your company use targeted financial and retirement savings messaging to employees, and if so, is it helping to improve employee retirement savings?” More than half of responding readers (57.7%) said their company uses targeted financial and retirement savings messaging to employees. Nearly four in ten (38.5%) reported that they do, and 3.8% indicated they don’t know. However, nearly half (47.1%) said they don’t know if the targeted messaging is helping to improve employee retirement savings, and 29.4% reported it is not. Only 23.5% indicated their targeted messaging is helping to improve employee retirement savings. In verbatim comments, a number of readers expressed that targeted messaging is invasive or not the responsibility of plan sponsors, with one going so far as saying, “It’s just CREEEEEPY!” Others shared stories of how their efforts have helped get more participants to save, while a few mentioned that—just like other plan communications—employees just do not read them.. A few mentioned that it is their recordkeeper that provides targeted messaging, and a few said provide access to a financial adviser is a better idea. Editor’s Choice goes to the reader who said, “Everything in moderation!” A big thank you to all who responded to the survey. Read more >
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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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