Newsdash Insight on Plan Design & Investment Strategy from PLANSPONSOR
February 21st, 2014
Benefit Briefs
Different Ideas of Retirement Require Different Messages
Think people are either pre- or post-retirement? Think again. Both include a spectrum of lifestyles and financial situations, research says, that need specific messaging and support from plan sponsors. A study about retirement funding and household finance from Hearts & Wallets LLC, a financial research company that studies consumer savings and investing behaviors, finds fewer than half of current retirees use personal assets for retirement income. “It’s not possible to understand retirees as a homogenous group,” says Laura Varas, partner at Hearts & Wallets. “Some have pensions, others simply haven’t saved enough to produce substantial income, and still others, of all wealth levels, are successfully funding their lifestyles with different types of savings or annuities.”
Employers to Spend More on Wellness Incentives
Corporate employers plan to spend an average of $594 per employee on wellness-based incentives within their health care programs this year, according to a new employer survey conducted jointly by Fidelity Investments and the National Business Group on Health (NBGH). This marks an increase of 15% from the average of $521 reported for 2013, and is more than double the average of $260 reported in 2009.
Buyer's Market
Neuberger Berman has introduced the Neuberger Berman Unconstrained Bond Fund. Available to institutions, the fund’s absolute-return oriented strategy provides investors with an alternative approach to traditional benchmark driven long-only investing, responding to current market dynamics. The firm tells PLANSPONSOR, depending on assets under management (AUM), it can offer either the mutual fund or a separate account.
D. Mark Schumann has joined The Segal Group as senior vice president and national communications practice leader. “Mark joins us with significant consulting, business and people leadership skills gained through his many years in the communications field,” says Joseph LoCicero, president and CEO of The Segal Group.
Economic Events
In the week ending February 15, the advance figure for seasonally adjusted initial claims for unemployment insurance was 336,000, a decrease of 3,000 from the previous week’s unrevised figure of 339,000, the Labor Department reported. The four-week moving average was 338,500, an increase of 1,750 from the previous week’s unrevised average of 336,750. The average interest rate for a 30-year fixed-rate mortgage is 4.33%, up from 4.28% one week ago, according to Freddie Mac. The average interest rate for a 15-year fixed-rate mortgage is 3.35%, up from 3.33%.
Market Mirror
Yesterday, the Dow was up 92.67 points (0.58%) at 16,133.23, the NASDAQ closed 29.59 points (0.70%) higher at 4,267.55, and the S&P 500 added 11.03 points (0.60%) to finish at 1,839.78. The Russell 2000 climbed 13.05 points (1.14%) to 1,162.12, and the Wilshire 5000 increased 126.95 points (0.65%) to 19,710.12. On the NYSE, 3.2 billion shares traded, with advancing issues outnumbering declining issues nearly 2 to 1. On the NASDAQ, 2.7 billion shares changed hands, with a more than 2 to 1 lead for advancers. The price of the 10-year Treasury note slipped 4/32, bringing its yield up to 2.753%. The price of the 30-year Treasury bond decreased 8/32, increasing its yield to 3.726%.
Financial Sense
Recommendations for Public Pension Funding Policies
An analysis issued by the American Academy of Actuaries examines factors that contribute to well-governed public-sector employee pension systems, as well as policy decisions that have led to the underfunding of many plans in recent years. The academy makes several suggestions for funding policies for public pension plans.
Rules & Regulators
ACA Waiting Period Limit Final Regs Issued
Final regulations concerning a 90-day limit on waiting periods for health coverage have been issued from federal agencies. In compliance with the Patient Protection and Affordable Care Act (or ACA), the regulations require that no group health plan or group health insurance issuer may impose a waiting period that exceeds 90 days after an employee is otherwise eligible for coverage.
PBGC Proposes Form 5000 Modifications
The Pension Benefit Guaranty Corporation (PBGC) requests the Office of Management and Budget (OMB) extend approval of information collection of annual Form 5500 reporting for another three years, with modifications. PBGC is proposing a few modifications to the Schedule MB (Multiemployer Defined Benefit Plan Actuarial Information) and the Schedule SB (Single Employer Defined Benefit Plan Actuarial Information) and related instructions.
Sponsored message from PLANSPONSOR
PLANSPONSOR Plan Sponsors of the Year – Corporate 401(k) – >$1B  Finalists include Eastman Chemical Company, Google, Inc. and Microsoft Corporation. Winners in each category will be announced in February and recognized at the Awards for Excellence dinner. View other categories.
Small Talk
The Internal Revenue Service (IRS) has released its annual “Dirty Dozen” list of tax scams. The list highlights a variety of common scams, ranging from identity theft to return preparer fraud. “These schemes jump every year at tax time. Scams can be sophisticated and take many different forms. We urge people to protect themselves and use caution when viewing emails, receiving telephone calls or getting advice on tax issues,” says IRS Commissioner John Koskinen.
ON THIS DATE:  In 1885, the Washington Monument, built in honor of America’s revolutionary hero and first president, was dedicated in Washington, D.C. In 1948, the National Association for Stock Car Racing (NASCAR) was officially incorporated. In 1965, in New York City, Malcolm X, an African American nationalist and religious leader, was assassinated by rival Black Muslims while addressing his Organization of Afro-American Unity at the Audubon Ballroom in Washington Heights. In 1981, Dolly Parton’s song “9 to 5” reached No. 1 on the pop charts.
And now it’s time for FRIDAY FILES!
Looking for something positive about the na.sty weather we’ve experienced this winter? How about fewer stink bugs?
In Des Moines, Iowa, a man walked into a restaurant with a gun when no customers were inside. He walked up to the counter and reportedly said, “Give me everything you got.” According to the Des Moines Register, one of the clerks calmly replied, “I don’t have anything for you. And plus, that’s a BB gun.” The would-be robber denied that, racked the slide and tried to fire the gun, but it apparently wasn’t loaded. He left the restaurant.
I think maybe there just wasn’t enough snow on the ground here to go sledding.
In Gielniow, Poland, a man felt he didn’t need to call a cab after he drank too much at a pub. He had a designated driver with him—his eight-year-old son. However, although, as the man later told police, he had allowed his son to practice driving during the weekends in a supermarket parking lot, the eight-year-old had struggled behind the wheel and caused a three-car pileup.  According to the UK’s Daily Express, the father and son were among five people taken to hospital with cuts and bruising following the accident. The father was later arrested for endangering the life of a minor and causing an accident. He faces up to five years in jail if convicted. In Lake County, Florida, a woman woke up and walked into the kitchen to make some coffee when she heard snoring. The snoring alarmed her because she lives alone. “I walked in the living room and there was a strange man on my couch curled up, covered up with my blanket,” the woman said, according to The man had broken in during the night after going on a burglary spree, according to investigators. The woman said the man even took a beer from her refrigerator before going to sleep on the couch. It was discovered the man had a butcher knife on his chest and he was holding it with one of his hands. Evidence linked the man to three other burglaries and a car break-in.
In New York City, a snow plow blew out the front of a restaurant, knocking over a customer.
In Portland, Oregon, students at Reed College started building a giant snowball on a campus quad following a trio of snowstorms in the city. Wanting to make the snowball as big as possible, two students started rolling it down a sidewalk. But, the snowball got away from them and continued rolling about 15 yards before smacking into a dorm. There were no injuries, but a college spokesman said it will cost $2,000 to $3,000 to repair the building, according to the Associated Press. A maintenance worker who sliced the snowball up for removal estimated it weighed 800 pounds or more. In Rochester, Minnesota, someone broke into Hooked on Fishing bait and tackle shop when he was startled by singing. A motion-activated Big Mouth Billy Bass was knocked over when the would-be thief broke in and started singing a loud rendition of “Take Me to the River,” according to the KIKN radio station. The person left without taking anything. In Milford, Iowa, a warehouse worker got a hankering for a snack, so he deposited $1 in a workplace vending machine, selected a Twix bar, and then watched as the candy bar got stuck on its descent. According to the Des Moines Register, at first, the worker used the customary route to retrieve stuck snacks from vending machines: He banged the side of the machine then tried rocking it back and forth. But, when that didn’t work, he walked away and returned in an 8,000-pound forklift. According to state unemployment compensation records, he reportedly drove up to the vending machine, lifted it two feet off the concrete warehouse floor — and let it drop. He allegedly repeated the maneuver at least six times, by which time three candy bars had fallen into the chute for his retrieval. When a supervisor confronted him, he allegedly explained he was simply trying to get the snack he had paid for. He was fired five days later. And, a state administrative law judge denied his claim for unemployment benefits, saying he had demonstrated a willful disregard for his employer’s interests. Have a great weekend, everyone!
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