Newsdash Insight on Plan Design & Investment Strategy from PLANSPONSOR
January 29th, 2018

PLANSPONSOR Announces 2017 DC Survey Standouts

Fourteen service providers to be recognized at the annual PLANSPONSOR/PLANADVISER Awards for Excellence dinner March 29. Read more >
Benefits & Administration
Health Care Costs Affecting Retirement for Some Workers
Thirty-one percent of American workers say that health care is the most important issue in the United States, according to an online survey of 1,518 workers that the Employee Benefit Research Institute (EBRI) conducted. Of the 48% of workers who say that their health care costs have increased, 26% have decreased contributions to their retirement plan, and 43% have decreased their contributions to other savings. More than one-quarter say they have difficulty paying for basic necessities, such as food, heat and housing. In addition, more than one-quarter, 27%, have delayed retirement. Read more >
Employers Considering Enhancing Benefits Due to Tax Reform
A survey of 333 large and mid-size employers by Willis Towers Watson reveals nearly half (49%) are considering making a change to at least one of their benefit or compensation programs this year or next due to tax reform. The most common benefit changes organizations have made or are planning or considering include expanding personal financial planning, increasing 401(k) contributions and increasing or accelerating pension plan contributions. Read more >
Mercer Suggests Areas of Focus for Not-for-Profit Health Care Systems
Mercer’s Not-For-Profit Healthcare consultant team has prepared a list of key areas of focus for 2018. Organizations that have chosen to eliminate pension risk by terminating their plans can do so most effectively by working with advisers to implement an end-state strategy, Mercer suggests. Improved governance with 403(b) plans has an added advantage, Mercer points out, as it also benefits plan participants in the form of improved performance and lower fees, thus leading to better financial outcomes. Read more >
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Products, Deals and People
Retirement Industry People Moves
AXA acquires Maestro Health; BMO appoints CIO; The Standard hires former financial adviser as retirement plan consultant; and more. Read more >
Economic Events

New orders for manufactured durable goods in December increased $7.0 billion or 2.9% to $249.4 billion, the U.S. Census Bureau announced. This increase, up four of the last five months, followed a 1.7% November increase. Excluding transportation, new orders increased 0.6%. Excluding defense, new orders increased 2.2%. Transportation equipment, also up four of the last five months, led the increase, $6.0 billion or 7.4% to $87.2 billion.

 

THE ECONOMIC WEEK AHEAD: Tomorrow, the Conference Board will release its Consumer Confidence Index for January. Thursday, the Labor Department will issue its initial claims report, and the Census Bureau will report about construction spending in December. Friday, the Bureau of Labor Statistics will reveal the unemployment rate for January, and the Census Bureau will report about factory orders for December.

Market Mirror

Friday, the Dow increased 223.92 points (0.85%) to 26,616.71, the NASDAQ climbed 94.61 points (1.28%) to 7,505.77, and the S&P 500 gained 33.62 points (1.18%) to finish at 2,872.87. The Russell 2000 was up 6.39 points (0.40%) at 1,608.06, and the Wilshire 5000 closed 309.76 points (1.05%) higher at 29,760.59.

 

The price of the 10-year Treasury note was down 9/32, increasing its yield to 2.659%. The price of the 30-year Treasury bond decreased 14/32, bringing its yield up to 2.907%.

 

WEEK’S WORTH: For the week ending January 26, the Dow increased 2.09%, the NASDAQ climbed 2.31%, and the S&P 500 gained 2.23%. The Russell 2000 was up 0.65%, and the Wilshire 5000 finished 2.09% higher.

Compliance
Dismissal of Capital Group Self-Dealing ERISA Challenge Offers Fiduciary Insight
The U.S. District Court for the Central District of California has dismissed a self-dealing Employee Retirement Income Security Act (ERISA) lawsuit alleging fiduciary violations and prohibited transactions on the part of Capital Group and its subsidiaries. The lawsuit alleged various violations in Capital Group’s selecting, retaining and failing to remove what plaintiffs called “expensive affiliated investment options in its retirement plan that generated significant revenue for Capital Group and its subsidiaries.” With the new opinion, the district court seeks to make clear where the line is when it comes to pleading standards in ERISA lawsuits. Read more >
Small Talk

ON THIS DATE: In 1802, John Beckley became the first Librarian of Congress. In 1845, Edgar Allan Poe’s “The Raven” was published for the first time in the “New York Evening Mirror.” In 1861, Kansas became the 34th state of the Union. In 1886, the first successful petrol-driven motorcar, built by Karl Benz, was patented. In 1936, the first members of major league baseball’s Hall of Fame were named in Cooperstown, New York. In 1963, the first members to the NFL’s Hall of Fame were named in Canton, Ohio. In 1979, U.S. President Jimmy Carter formally welcomed Chinese Vice Premier Deng Xiaoping to the White House. The visit followed the establishment of diplomatic relations. In 1990, Joseph Hazelwood, the former skipper of the Exxon Valdez, went on trial in Anchorage, Alaska, on charges that stemmed from America’s worst oil spill. Hazelwood was later acquitted of all the major charges and was convicted of a misdemeanor. In 1995, the San Francisco 49ers became the first team in National Football League (NFL) history to win five Super Bowl titles. The 49ers defeated the San Diego Chargers 49-26. In 1999, Paris prosecutors announced the end of the investigation into the accident that killed Britain’s Princess Diana.

SURVEY SAYS RESPONSES: Last week, I asked NewsDash readers which team they would like to see win Super Bowl 52. Clearly, the Eagles have more responding readers rooting for them, as the team was selected by 63.2%, while less than one-quarter (24.5%) selected the Patriots. But, 12.3% of respondents said they don’t care which team wins. So many of the readers who chose to leave comments expressed that the Patriots in or winning the Super Bowl is getting old, but some are rooting against the Eagles because of fan behavior. Others say they watch the game just for the commercials or half-time show. A few expressed issues with financial aspects of the game, against the backdrop of the government shutdown and needs of many Americans. Editor’s Choice goes to the reader who said: “It’s time for a new team to win.” Thanks to everyone who participated in 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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