Newsdash Insight on Plan Design & Investment Strategy from PLANSPONSOR
December 4th, 2018
Compliance
Changes to ERISA Plan Annual Financial Audits Approved
Proposed in April 2017, the Statement on Auditing Standards addresses the auditor’s responsibilities to form an opinion and report on the financial statements of Employee Retirement Income Security Act (ERISA) plans, and the form and content of such reporting. Read more >
Case Over Aon Hewitt Financial Engines Agreement Finally Dismissed
The U.S. District Court for the Northern District of Illinois has dismissed with prejudice a case alleging that Aon Hewitt, as a provider to the Caterpillar 401(k) plan, received what amounted to kickbacks from an agreement with Financial Engines to provide advice to plan participants. According to the docket report for the case, the parties report they have resolved the case. Read more >
USC Asks Supreme Court to Weigh in on Arbitration of Retirement Plan Claims
The University of Southern California (USC) has asked the U.S. Supreme Court to determine whether participants who filed a lawsuit challenging the management of the university’s two Employee Retirement Income Security Act (ERISA) retirement plans should be compelled to arbitrate their claims pursuant to an agreement signed with the university. The plaintiffs in the case were required to sign arbitration agreements as part of their employment contracts. Denying a motion to compel arbitration, the 9th U.S. Circuit Court of Appeals concluded that the dispute fell outside the scope of the arbitration agreements because the claims were brought on behalf of the ERISA plans, not the individuals. Read more >
MOST READ ARTICLES
1
IRS Announces 2019 HSA Contribution Limits
2
4% Rule Not a Reliable Retirement Income Withdrawal Strategy for All People
3
Lawsuit Argues MetLife Pension Calculations Use Outdated Mortality Table
4
Financially Well Employees Buoy the Bottom Line
5
401(k) Plan Sponsors Enhancing Plan Design
PLANSPONSOR Research
2018 DC Survey: Plan Benchmarking
Our annual Defined Contribution Survey shows some progressive trends. For example, nearly one-third of defined contribution (DC) plan sponsors allow separated participants to pay off their loans after they terminate employment. In addition, six years ago, only about 37% of plans would auto-enroll employees at a rate exceeding 3% of salary. Now, nearly 48% of plans do so, and over 35% of plans default at 5% or more. Read more >
Economic Events

Construction spending during October was estimated at a seasonally adjusted annual rate of $1,308.8 billion, 0.1% below the revised September estimate of $1,310.8 billion, the Census Bureau reported. The October figure is 4.9% above the October 2017 estimate of $1,247.5 billion. During the first ten months of this year, construction spending amounted to $1,096.4 billion, 5.1% above the $1,043.6 billion for the same period in 2017.

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Market Mirror

Yesterday, the Dow gained 287.97 points (1.13%) to finish at 25,826.43, the NASDAQ closed 110.98 points (1.51%) higher at 7,441.51, and the S&P 500 increased 30.20 points (1.09%) to 2,790.37. The Russell 2000 was up 15.69 points (1.02%) at 1,548.96, and the Wilshire 5000 climbed 319.62 points (1.12%) to 28,768.49.

 

The price of the 10-year Treasury note was up 6/32, decreasing its yield to 2.973%. The price of the 30-year Treasury bond increased 25/32, bringing its yield down to 3.253%.

Benefits & Administration
Part-Time Plan Eligibility Would Benefit Latino Workers
A new report published by UnidosUS and the National Institute on Retirement Security, “Latinos’ Retirement Insecurity in the United States,” examines the disparities in retirement readiness found between working Latinos aged 21 to 64 and other racial and ethnic groups in the U.S. According to Brown and Oakley, access and eligibility to an employer-sponsored retirement plan remains the largest hurdle to Latinos’ retirement security. The authors find the retirement plan participation rate for Latino workers (30.9%) is about 22 percentage points lower than participation rate of white workers (53%). For working Latino individuals who are saving, their average savings in a retirement account is less than one-third of the average retirement savings of white workers. Read more >
Small Talk

ON THIS DATE: In 1812, Peter Gaillard patented the power mower. In 1918, President Woodrow Wilson set sail for France to attend the Versailles Peace Conference, becoming the first chief executive to travel to Europe while in office. In 1942, President Franklin D. Roosevelt ordered the dismantling of the Works Progress Administration—a program created to provide jobs during the Great Depression. In 1942, U.S. bombers attacked the Italian mainland for the first time during World War II. In 1945, the Senate approved American participation in the United Nations. In 1973, Pioneer 10 reached Jupiter. In 1978, Dianne Feinstein became San Francisco’s first woman mayor when she was named to replace George Moscone, who had been murdered. 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.

TRIVIAL PURSUITS: The $2 dollar bill is America’s rarest small denomination in the U.S. Currency. Do you know whose picture is on the $2 bill? 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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