Newsdash Insight on Plan Design & Investment Strategy from PLANSPONSOR
January 6th, 2017
Benefits & Administration
Interest rates are on the rise—marked by the U.S. Federal Reserve’s rate boost in December—and that represents good news for retirement savers looking to generate secure lifetime income once they’re no longer drawing a paycheck, BlackRock says. The cost of purchasing retirement income products is much lower than a few months ago, BlackRock data shows.Read more >
The Evolution of Employee Wellness Programs
More employers are devising holistic wellness programs that address physical, mental and financial health; and technology could be the main driver in boosting participation.Read more >
Products, Deals and People
Beaumont Capital Management launches smart beta solutions; Vanguard adds 2065 TDF; Pacific Funds cuts fees on fixed income funds; and more. Read more >
New Financial Audit Rule Increases Requirements for Plan Sponsors
2021 Recordkeeping Survey
Data and Research
Participants Missing the Full Match Remains a Big Problem
Economic Events

In the week ending December 31, the advance figure for seasonally adjusted initial claims for unemployment insurance was 235,000, a decrease of 28,000 from the previous week’s revised level of 263,000, the Labor Department reported. The four-week moving average was 256,750, a decrease of 5,750 from the previous week’s revised average of 262,500. 

The average interest rate for a 30-year fixed-rate mortgage is 4.20%, down from 4.32% one week ago, according to Freddie Mac. The average interest rate for a 15-year fixed-rate mortgage is 3.44%, down from 3.55%. 

Market Mirror

Thursday, the Dow was down 42.87 points (0.21%) at 19,899.29, the NASDAQ increased 10.93 points (0.20%) to 5,487.94, and the S&P 500 decreased by 1.75 (0.08%) to 2,269.00. The Russell 2000 lost 16.02 points (1.15%) to finish at 1,371.93, and the Wilshire 5000 closed 52.29 points (0.22%) lower at 23,748.63.

On the NYSE, 3.1 billion shares traded, with a slight lead for decliners. On the NASDAQ, 2.9 billion shares changed hands, with a 1.4 to 1 ratio of declining issues to advancing issues.

The price of the 10-year Treasury note increased 25/32, bringing its yield down to 2.350%. The price of the 30-year Treasury bond climbed 1 28/32, decreasing its yield to 2.945%. 

DOL Sues ESOP Fiduciaries Over Share Sale
A new lawsuit filed by the Department of Labor (DOL) alleges the fiduciaries of an employee stock ownership plan (ESOP) established by a Vermont employer violated their fiduciary duties of loyalty and prudence. The lawsuit alleges the price at which shares of the ESOP were sold was artificially inflated. Read more >
Claims in Excessive Fee Suit Against Prudential Tossed
A court found Prudential was not acting as a fiduciary and an employer’s 401(k) plan menu and use of an investment selection tool were appropriate. Read more >
From the Magazine
Hello, Passive Management
According to Callan’s 2016 Defined Contribution Trends Survey, 68.4% of plans now use a mix of active and passive funds; 18.8% utilize an active/passive mirror approach—offering both options for each asset class; 4.3% offer all active funds; and 3.4% have all passive funds. Use of passive options in 401(k) plans continues growing, but not necessarily for the right reasons. Read more >
Retirement Income Alternatives
Just 7.3% of plans offer in-plan income products that guarantee monthly income, according to this year’s PLANSPONSOR DC Survey, while 3.6% offer in-plan income products that guarantee a base benefit, and 5.7% offer an in-plan income product that does not provide guarantees. Many plan sponsors likely will look at alternate ways to help participants with retirement income. Read more >
At the beginning of each year, PLANSPONSOR is lucky to receive a flood of market outlook commentary from all across the investment services provider spectrum; the resulting mosaic of opinion presents some real food for thought when planning the year of coverage ahead. One of the most thorough outlooks shared annually comes from Bob Doll, senior portfolio manager and chief equity strategist for Nuveen Asset Management, who offers up a series of predictions pertaining to anticipated market performance over the coming year. Doll is quick to warn that very rarely do all of his predictions pan out—but there are a lot of signals one can look to right now for an idea about how the markets may behave in the months ahead. Read more >
Small Talk

ON THIS DATE: In 1838, Samuel Morse publicly demonstrated the telegraph for the first time. In 1912, New Mexico became the 47th U.S. state. In 1942, the first commercial around-the-world airline flight took place. Pan American Airlines was the company that made history with the feat. In 1945, the Battle of the Bulge ended with 130,000 German and 77,000 Allied casualties. In 1952, the “Peanuts” comic strip debuted in Sunday papers across the United States. In 1963, “Wild Kingdom” premiered on NBC. In 1987, after a 29-year lapse, the Ford Thunderbird was presented with the Motor Trend Car of the Year Award. It was the first occurrence of a repeat winner of the award. In 1999, Bob Newhart received a star on the Hollywood Walk of Fame.


And now it’s time for FRIDAY FILES

Great New Year’s resolution advice from a 4-year-old. Read more >
The man in this modeling shoot has a little trouble with his pants. Read more >
This dog eats a banana just like we do. Read more >

In Hanoi, Vietnam, a 54-year-old man complained of stomach pains and was given medicine for a stomach ulcer. When that didn’t help, an X-ray found the problem— surgical forceps inside his body had broken apart and become lodged in his stomach. According to national television VTV, the forceps had probably been left in his abdomen in 1998 when he had emergency surgery after a traffic accident. They have since been removed.

In Highlands County, Florida, a man sentenced to 10 years in prison for using a stolen identity to obtain more than $300 in products and services from Verizon Wireless is suing the company for not stopping him. The local ABC News station reports that on May 7, 2015, the man went to a Verizon store and used his ID to steal from an existing customer with the same first and last name, but a different middle name. The suit claims the Verizon employee man says Verizon’s “negligence” caused a loss of “civil liberties and freedoms.” He is seeking $72 million in damages.

In Mainhausen, Germany, a man returning home one morning from working a night shift found a brick wall in front of his door. The mortar on the bricks was dry enough that the man had to borrow an ax to smash through the wall in order to get to his front door, according to, a German website. Police believe the wall was built by pranksters, but said it is a crime, not a joke. They estimate damage caused by the wall builders to be around $523. Most of the damage was to the front door, its frame and the bell.

In Dormont, Pennsylvania, a couple went to an auto shop to get an oil change for the husband’s truck. The wife had to use the restroom and the next thing she knew, she was holding her newborn baby. The woman said she felt little pain or contractions. When she yelled for help, another customer, who happened to be a registered nurse, came to her aid. A 911 dispatcher told the husband how to tie off the umbilical cord and mom and baby were rushed to the hospital.

Have a wonderful weekend, everyone!

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Editorial: Alison Cooke Mintzer


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