Newsdash Insight on Plan Design & Investment Strategy from PLANSPONSOR
January 20th, 2016
PLANSPONSOR DC Survey Standouts
2015 PLANSPONSOR DC Survey Standouts
In its annual Defined Contribution (DC) Survey, PLANSPONSOR asks defined contribution plan sponsors representing employers of all sizes from across the United States: “How satisfied are you with your provider?” After more than 5,000 responses were received and tabulated, 11 companies stood above the rest in PLANSPONSOR’s annual DC Survey by accumulating the greatest number of Service “cups” in the survey’s six main asset classes ranging from “micro” plans with less than $5 million in assets to “mega” plans with more than $1 billion in assets.Read more >
Benefits & Administration
Auto Enrollment an Opportunity for Church Plans
Church plan legislation provides an immediate opportunity for plan sponsors to affect participant outcomes through auto enrollment; the effect of other provisions remains to be seen.Read more >
Retirement Contribution Limits, COLA Stay on Track With Continuing Resolution
Social Security Administration Cannot Calculate 2024 COLA if Government Shuts Down
Data and Research
Low Account Balances, Gender Savings Gap Found Among Public Sector Workers
GASB 68 a Wake Up Call for Local Governments
Researchers for the Center for Retirement Research at Boston College conclude that new accounting standards forcing cities to recognize their share of a state’s unfunded pension plan liability may lead them to take more interest in having these liabilities paid off. In an analysis, they found that for 92 cities, the unfunded liability as a percentage of revenue rises from 37% before GASB 68 pension accounting standards to 70% after.Read more >
Guardian’s third annual Workplace Benefits Study finds employers are using more vendors for support, with nearly two-thirds outsourcing some benefits administration using multiple vendors, up from 48% in 2013. Several factors are driving this upswing in benefits outsourcing.Read more >
DC Plan Industry Could Use Some Balance
One lesson Josh Cohen, managing director and head of defined contribution for Russell Investments, has consistently seen in his 20-plus years in the retirement plan industry, is that the industry, taken all together, is very good at coming up with new solutions and innovative approaches to problems, but it’s not as good at finding balance and sticking with what works. “Whether we want to talk about the active versus passive management debate, or complex versus simplified investment menus, there is always a strong push and pull moving the industry in one direction or another,” Cohen suggests. “There is very little equilibrium. Perhaps the quintessential example can be seen in the trends around investment menu construction.”Read more >
Sponsored message from BlackRock
DC Fixed Income: The World Has Changed. It’s Time to Catch Up
Learn how DC plans should respond to a fixed income environment that is more complicated than anything we’ve seen in decades.Read more >
Market Mirror

Tuesday, the Dow was up 27.94 points (0.17%) at 16,016.02, the NASDAQ was down 11.47 points (0.26%) at 4,476.95, and the S&P 500 increased by 1.00 (0.05%) to 1,881.33. The Russell 2000 closed 12.86 points (1.28%) lower at 994.86, and the Wilshire 5000 slipped 22.41 points (0.12%) to 19,199.17.

On the NYSE, 3.1 billion shares traded, with declining issues outnumbering advancing issues more than 2 to 1. On the NASDAQ, 2.7 billion shares changed hands, with a near 2 to 1 lead for decliners.

The price of the 10-year Treasury note was down 5/32, increasing its yield to 2.056%. The price of the 30-year Treasury bond decreased 8/32, bringing its yield up to 2.827%.
Overfunded Status Makes Case Against DB Plan Sponsor Moot
A lawsuit filed by participants in U.S. Bank’s defined benefit (DB) retirement plan has been dismissed as moot because the plan is now overfunded. Plaintiffs in the case challenged the bank’s 100% equities investment strategy and its investment of plan assets in one of its subsidiaries. However, since the lawsuit was filed, U.S. Bank changed investment strategies and sold its subsidiary.Read more >
The Department of Labor (DOL) has obtained judgment to distribute $1.3 million to participants in a 401(k) plan based in Dunwoody, Georgia. The plan’s recordkeeper refused to make distributions after the former plan fiduciary changed each participant’s address to his own.Read more >
Concerns Expressed About State-Run Retirement Plans
In comments to the Department of Labor (DOL), the American Retirement Association (ARA) and Voya Financial say the DOL’s proposal for state-run retirement plans for private-sector employees will create a lack of uniformity. They call for the DOL to extend relief to private-sector plans that it is proposing for state-run plans.Read more >
New data from Strategic Insight shows long-term mutual funds and ETFs attracted $158 billion of net new investment in 2015, despite $40 billion of outflows in December.Read more >
Small Talk
Fifty percent of employers say they know within the first five minutes of an interview if a candidate is a good fit for a position. Employers surveyed by CareerBuilder shared common body language mistakes job seekers make and recalled some really strange interview actions.Read more >

ON THIS DATE: In 1801, John Marshall was appointed chief justice of the United States. In 1885, the roller coaster was patented by L.A. Thompson. In 1887, the U.S. Senate approved an agreement to lease Pearl Harbor in Hawaii as a naval base. In 1937, Franklin Delano Roosevelt became the first U.S. President to be inaugurated on January 20th. The 20th Amendment of the U.S. Constitution officially set the date for the swearing in of the president and vice president. In 1981, Iran released 52 Americans who had been held hostage for 444 days. In 1985, the most-watched Super Bowl game in history was seen by an estimated 115.9 million people. The San Francisco 49ers defeated the Miami Dolphins 38 to 16. Super Bowl XIX marked the first time that TV commercials sold for a million dollars a minute. In 1986, the U.S. observed the first federal holiday in honor of slain civil rights leader Martin Luther King, Jr. In 1998, American researchers announced they had cloned calves that may produce medicinal milk.


WEDNESDAY WISDOM: “We must learn to live together as brothers or perish together as fools.”—Martin Luther King, Jr.
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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