Newsdash Insight on Plan Design & Investment Strategy from PLANSPONSOR
July 1st, 2019

Providers Reluctant to Serve Newly Allowed 401(k)s

Due to the misunderstanding about the intersection between state and federal Cannabis laws, lack of provider support may stop hemp and CBD companies from sponsoring 401(k) plans. Read more >
Benefits & Administration
To Succeed, Financial Wellness Programs Need to Motivate Participants
To truly help participants, financial wellness programs need to advance beyond mere education to truly motivate participants to take action to improve their financial outlook, according to Cerulli Associates. Read more >
Gen X Financially Behind Prior Generations at Same Ages
However, the Generation X families associated with disadvantaged groups were the driving force for the lower overall financial indicator results, an Employee Benefits Research Institute (EBRI) issue brief says. Read more >
MOST READ ARTICLES
1
Adidas Sued Over Excessive Fees for 401(k) Participants
2
(b)lines Ask the Experts – Proper Delivery Method for SPDs
3
Yale Sued Over Wellness Program ‘Penalty’
4
Employees in Two States Miss Out on One HSA Benefit
5
Some Help for Women’s Retirement Savings Gap May Be Coming
Products, Deals and People
Retirement Industry People Moves
TPA firm to join Ascensus; EGPS acquires Feldman Benefit Services; Mutual of Omaha announces appointment to 401(k) team; and more. Read more >
Economic Events

THE ECONOMIC WEEK AHEAD: Today, the Census Bureau will report about construction spending for May. Wednesday, the Census Bureau will report about factory orders for May, and the Labor Department will issue its initial claims report. Friday, the Bureau of Labor Statistics will reveal the unemployment rate for June.

Market Mirror

Friday, the Dow was up 73.38 points (0.28%) at 26,599.96, the NASDAQ increased 38.49 points (0.48%) to 8,006.24, and the S&P 500 closed 16.84 points (0.58%) higher at 2,941.76. The Russell 2000 climbed 20.02 points (1.29%) to 1,566.57, and the Wilshire 5000 gained 197.52 points (0.66%) to finish at 30,266.93.

 

The price of the 10-year Treasury note was up 1/32, decreasing its yield to 2.004%. The price of the 30-year Treasury bond was down 1/32, increasing its yield to 2.534%.

 

WEEK’S WORTH: For the week ending June 28, the Dow lost 0.45%, the NASDAQ finished 0.32% lower, and the S&P 500 decreased 0.29%. The Russell 2000 climbed 1.09%, and the Wilshire 5000 was down 0.18%.

Compliance
50-Year Old Mortality Data Questioned in Latest ERISA Lawsuit
A new complaint filed in the U.S. District Court for the Eastern District of Virginia resembles several others filed in the last year against MetLife, Pepsi and American Airlines, suggesting the use of outdated mortality tables in determining annuity payments causes retirees to lose part of their vested retirement benefits. Read more >
Small Talk

ON THIS DATE: In 1847, in New York City, the U.S. Post Office issued its first adhesive stamps. The two stamps available were a 5-cent Benjamin Franklin and a 10-cent George Washington. In 1862, Congress established the Bureau of Internal Revenue. In 1863, during the U.S. Civil War, the first day’s fighting at Gettysburg began. In 1874, the Philadelphia Zoological Society zoo opened as the first zoo in the United States. In 1905, the USDA Forest Service was created within the Department of Agriculture. The agency was given the mission to sustain healthy, diverse, and productive forests and grasslands for present and future generations. In 1909, Thomas Edison began commercially manufacturing his new “A” type alkaline storage batteries. In 1934, the Federal Communications Commission replaced the Federal Radio Commission as the regulator of broadcasting in the United States. In 1941, Bulova Watch Company sponsored the first TV commercial in New York City. In 1943, the U.S. Government began automatically withholding federal income tax from paychecks. In 1946, the U.S. exploded a 20-kiloton atomic bomb near Bikini Atoll in the Pacific Ocean. In 1950, American ground troops arrived in South Korea to stem the tide of the advancing North Korean army. In 1963, the U.S. postmaster introduced the five-digit ZIP (Zoning Improvement Plan) code. In 1966, the Medicare federal insurance program went into effect. In 1979, Susan B. Anthony was commemorated on a U.S. coin, the Susan B. Anthony dollar. In 1979, Sony introduced the Walkman. In 1980, President Jimmy Carter signed legislation that provided for 2 acres of land near the Lincoln Memorial for the Vietnam Veterans Memorial.

SURVEY SAYS RESPONSES: Among provisions of the SECURE Act are those that would allow unrelated plan sponsors to band together in pooled employer plans, otherwise known as “open” multiple employer plans (MEPs); change the age participants have to start taking required minimum distributions to 72; and provide a new safe harbor for plan sponsors to select a lifetime income provider in order to offer annuities within their retirement plan. Last week, I asked NewsDash readers whether they think these provisions will improve the retirement income adequacy of Americans. Respondents generally did not feel any of the SECURE Act provisions asked about would improve the retirement income adequacy of Americans. As for the ability for unrelated plan sponsors to participate in an open multiple employer plan, 40.6% indicated it will improve the retirement income adequacy of Americans, and half said it would not. Only 21.9% of respondents think changing the age retirement plan participants are required to take a minimum distribution from 70 1/2 to 72 will improve the retirement income adequacy of Americans, while 62.5% said they don’t think it would. Asked if they think a new safe harbor for plan sponsors to select a lifetime income provider in order to offer annuities within their retirement plan will improve the retirement income adequacy of Americans, 31.2% said yes, and 59.4% said no. Many readers who left comments pointed out that no legislation will help if Americans are not willing to participate and save in retirement plans. A couple of readers suggested the legislation should include required financial wellness education in schools. Generally, respondents feel the legislation will have a minimal effect on improving retirement income adequacy. Editor’s Choice goes to the reader who said: “At the end of the day, it comes down to the participant and their savings ability to defer and to not touch the money they are saving.” A big thank you to all 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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