Newsdash Insight on Plan Design & Investment Strategy from PLANSPONSOR
January 28th, 2015
Plan Sponsor of the Year Finalists
More Plan Sponsor of the Year Finalists Announced
Each year, the editors of PLANSPONSOR recognize a number of plan sponsors that demonstrate leadership in providing a more secure retirement for workers. Today, PLANSPONSOR is pleased to announce the finalists for the 2015 PLANSPONSOR Plan Sponsor of the Year award in the Corporate 401(k) $250 Million to $1 Billion category and the Corporate 401(k) > $1 Billion category.  Read more >
Benefits & Administration
Retirement Plan Rollover Basics
Departing retirement plan participants may wish to roll over their plan assets to another qualified plan or individual retirement account (IRA) to avoid paying taxes and to continue saving for retirement. There are certain guidelines that must be adhered to when rolling over retirement plan assets to an IRA or another qualified plan.  Read more >
Defined contribution (DC) salary deferral rates are climbing strongly, with 32% of participants increasing their deferral rate in the past year, according to a Market Strategies International study. Market Strategies International notes this increase is 11% greater than the number of DC plan participants who expressed the intention to increase their 2014 contributions in a 2013 survey taken by the firm. The increase is driven by the younger generations, the firm says, given that Generations X and Y have a preference for automatic plan enrollment features.  Read more >
Sponsored message from Financial Engines
PLANSPONSOR interviews Christopher Jones, chief investment officer (CIO) at Financial Engines.   Read more >
Products, Deals & People
As the new national sales manager of Guardian Retirement Solutions, Jim Lake will oversee all aspects of the firm’s retirement plans distribution. In addition to overseeing annuity distribution, Lake also assumes responsibility for the retirement plans wholesaling team, the retirement plans sales desk and 401(k) key account management.  Read more >
Is the UAW’s Demand for Return of Pensions a Realistic Ask?
Delay on Catch-Up Provision Allows Employers to Explore Optional SECURE 2.0 Features
Data and Research
Unplanned Financial Challenges Continue to Plague US Workers’ Retirement Savings
Economic Events

New orders for manufactured durable goods in December decreased $8.1 billion or 3.4% to $230.5 billion, the U.S. Census Bureau announced. This decrease, down four of the last five months, followed a 2.1% November decrease. Excluding transportation, new orders decreased 0.8%. Excluding defense, new orders decreased 3.2%.  Transportation equipment, also down four of the last five months, led the decrease, $6.8 billion or 9.2% to $66.7 billion.


Sales of new single-family houses in December 2014 were at a seasonally adjusted annual rate of 481,000, according to estimates released jointly today by the U.S. Census Bureau and the Department of Housing and Urban Development. This is 11.6% above the revised November rate of 431,000 and is 8.8% above the December 2013 estimate of 442,000.


The Conference Board Consumer Confidence Index, which had increased in December, rose sharply in January. The Index now stands at 102.9 (1985=100), up from 93.1 in December. The Present Situation Index rose to 112.6 from 99.9, while the Expectations Index increased to 96.4 from 88.5 in December. Lynn Franco, Director of Economic Indicators at The Conference Board, said: “Consumer confidence rose sharply in January, and is now at its highest level since August 2007 (Index, 105.6).”

Market Mirror

U.S. stock indices closed lower after disappointing outlooks from companies like Caterpillar and Microsoft. The Dow fell 291.49 points (1.65%) to 17,387.21, while the NASDAQ dropped 90.27 points (1.89%) to 4,681.50, and the S&P 500 lost 27.51 points (1.34%) to finish at 2,029.58. The Russell 2000 was down 6.08 points (0.51%) at 1,194.66, and the Wilshire 5000 closed 250.26 points (1.15%) lower at 21,435.56.


On the NYSE, 3.2 billion shares changed hands, with 1.3 declining issues for every advancing issue. On the NASDAQ, 2.7 billion shares traded, with a 1.6 to 1 ratio of decliners to advancers.


The price of the 10-year Treasury note was up 4/32, decreasing its yield to 1.815%. The price of the 30-year Treasury bond increased 14/32, bringing its yield down to 2.391%.

Council Supports Keeping Participants in Plans
The 2014 ERISA Advisory Council examined recent movement of participant assets out of defined contribution (DC) and defined benefit (DB) plans—either as plan distributions or rollovers into retirement accounts not covered by the Employee Retirement Income Security Act (ERISA), such as individual retirement accounts (IRAs) or other savings vehicles. The council’s report provides ideas for plan administrators and plan participants, including communication strategies and plan design options to facilitate lifetime retirement plan participation.  Read more >
Senator Hatch Discusses Retirement Reform
In a recent speech before the U.S. Chamber of Commerce, Senator Orrin Hatch (R-Utah) said his goal in directing the Senate’s Finance Committee over the next two years will be to “strike away at Obamacare” while addressing entitlement programs and pension reform. Hatch’s speech approached retirement issues from a few different angles.  Read more >
From the Magazine
Asset Class Focus: Target-Risk Funds
In the late 1980s and early ’90s, investment providers envisioned a world where plan participants would be keen to learn the ins and outs of investing, then construct and manage their own retirement portfolios. After a few years, however, plan sponsors recognized that investors were not nearly as engaged as the fund companies had hoped, and retirement participants’ investments were far from optimal. Thus, in the mid-1990s, fund companies devised target-risk funds.  Read more >
Small Talk
ON THIS DATE: In 1878, the first telephone switchboard was installed in New Haven, Connecticut. In 1916, President Woodrow Wilson nominated Louis Brandeis to the Supreme Court. Brandeis became the first Jewish judge on the Supreme Court. In 1985, American recording artists gathered to record “We Are the World,” which went on to sell more than 7 million copies and raise more than $60 million for African famine relief. In 1986, the space shuttle Challenger lifted off from Cape Canaveral, Florida, and Christa McAuliffe, a 37-year-old high school social studies teacher from New Hampshire, was on her way to becoming the first ordinary U.S. civilian to travel into space. Seventy-three seconds later, the shuttle exploded in a forking plume of smoke and fire. There were no survivors. In 1997, Clive Davis received a star on the Hollywood Walk of Fame. In 1999, Ford Motor Company announced the purchase of Sweden’s Volvo AB for $6.45 billion.
WEDNESDAY WISDOM: “You always have two choices: your commitment versus your fear.” —Sammy Davis Jr., American entertainer
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Copyright © Asset International, Inc., 2015.

All rights reserved.  No reproduction without prior authorization.

Editorial: Alison Cooke Mintzer


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