Newsdash Insight on Plan Design & Investment Strategy from PLANSPONSOR
July 31st, 2015
Benefits & Administration
A Plan Sponsor Hires a 3(38) Investment Manager
As is true for many small business owners, selecting and monitoring retirement plan investments wasn’t Hollis Lamon’s full-time job. He needs to focus on running and growing his business. “Picking retirement plan investments takes time, inclination and knowledge,” Hollis, president of Lamon and Stern, Inc., an Atlanta-based broker/dealer, tells PLANSPONSOR. “It didn’t make sense from a fiduciary standpoint for me to be picking the funds and responsible for funds when I can have someone else do it for me.” Hollis says the new fee reporting requirements established by updates to Employee Retirement Income Security Act (ERISA) sections 404a-5 and 408(b)(2) in 2012 also led him to seek help.Read more >
MOST READ ARTICLES
Compliance
New Financial Audit Rule Increases Requirements for Plan Sponsors
Research
2021 Recordkeeping Survey
Compliance
DOL Proposes New Rule on ESG Investing in Retirement Plans
An analysis from the National Institute on Retirement Security finds Americans in nearly every state are expected to fall far short on purchasing power in their golden years. The bleak findings are from the institute’s State Financial Security Scorecards research project. During a webcast covering the findings, a panel of experts warned even the highest-ranking states show “weak outlooks in terms of potential retirement income for retirees.” Put another way, even workers in the top-ranked states have far less saved than they are likely to need to fund a comfortable retirement.Read more >
A study by software provider SAS and Duke University, just published in The American Journal of Managed Care, found primary care users of the SAS Health Care Center (HCC) saved the company up to $600 per user in health plan claims costs over three years. One takeaway from the study, “Worksite Medical Home: Health Services Use and Claim Costs,” is that use of on-site medical centers is associated with decreased total use of outpatient care including preventive care services.Read more >
Federal TSP Considering Expanded Withdrawal Options
Federal Thrift Savings Plan (TSP) Executive Director Greg Long has issued a memo to Federal Retirement Thrift Investment Board members recommending more flexible withdrawal options for TSP members. In the memo, acquired by FedSmith, Long says an examination of TSP data last year “confirmed that many participants are transferring their balances from the TSP to other financial institutions at age 59½ and upon separation from federal employment. Virtually all of these transferred dollars are moving into accounts with higher expenses than are available within the TSP, a fact that appears to run counter to the participants’ interest.”Read more >
Total 401(k) Contributions Reach Record Levels
For the trailing 12 months ending in the second quarter, total contributions, including company match, to 401(k) plan participant accounts reached $10,180, up from $9,840 at the end of the first quarter, according to Fidelity Investments. This is the first time that trailing one-year contributions surpassed $10,000. Fidelity also found Baby Boomer participants may be overweight in equities.Read more >
Products, Deals & People
John Hancock to Offer Financial Wellness Program
John Hancock Retirement Plan Services will begin offering Morningstar’s HelloWallet financial wellness program on its Total Retirement Solutions platform in the fourth quarter.Read more >
Economic Events

In the week ending July 25, the advance figure for seasonally adjusted initial claims for unemployment insurance was 267,000, an increase of 12,000 from the previous week’s unrevised level of 255,000, the Labor Department reported. The four-week moving average was 274,750, a decrease of 3,750 from the previous week’s unrevised average of 278,500.

The average interest rate for a 30-year fixed-rate mortgage is 3.98%, down from 4.04% one week ago, according to Freddie Mac. The average interest rate for a 15-year fixed-rate mortgage is 3.17%, down from 3.21%.

Market Mirror

Major U.S. stock indices ended mostly flat Thursday. The Dow slipped 5.41 points (0.03%) to 17,745.98, the NASDAQ closed 17.05 points (0.33%) higher at 5,128.78, and the S&P 500 was virtually unchanged at 2,108.63. The Russell 2000 increased 2.47 points (0.20%) to 1,232.07, and the Wilshire 5000 was up 13.47 points (0.06%) at 22,205.86.

On the NYSE, 3.2 billion shares changed hands, with a nearly even split between advancers and decliners. On the NASDAQ, 2.8 billion shares traded, with a slight lead for advancers.

The 10-year Treasury note increased 7/32, bringing its yield down to 2.261%. The price of the 30-year Treasury bond climbed 1 3/32, decreasing its yield to 2.944%.

Compliance
The Michigan Supreme Court has upheld the constitutionality of a 2011 law that forced 15,000 state workers to contribute 4% of their salary to maintain full pension benefits, the Detroit News reports. The decision overturned a lower court ruling that said forcing state workers to put 4% of pay into the pension or move to a defined contribution (DC) plan was unconstitutional.Read more >
Lawmakers Press DOL to Redraft Fiduciary Proposal
A group of members of the U.S. House of Representatives Thursday sent a letter to Thomas Perez, secretary of the Department of Labor (DOL), suggesting a re-proposal of its recent re-proposal. Their concern, just days after the end of the comment period, is that the expansion of the fiduciary definition would hinder Americans trying to save for retirement.Read more >
Small Talk

ON THIS DATE: In 1875, former President Andrew Johnson, who had become president upon the assassination of Abraham Lincoln in 1865, died of a stroke while visiting his daughter in Tennessee. In 1928, MGM’s Leo the lion roared for the first time for MGM’s first talking picture, “White Shadows on the South Seas.”  In 1975, James Riddle Hoffa, one of the most influential American labor leaders of the 20th century, disappeared in Detroit, Michigan, never to be heard from again. In 1989, the Game Boy handheld video game device was released in the U.S.

 

And now it’s time for FRIDAY FILES!

In Acadiana, Louisiana, the St. Landry Parish law enforcement is angry someone robbed Stelly’s Supermarket and gives a very real Crime Stoppers report.Read more >
In Sioux Falls, South Dakota, a 17-year-old J.C. Penney employee was sent home for wearing short her boss said were “too revealing.” The girl pointed out that she bought the shorts in the J.C. Penney career department. A local news station reported that her boss told her shorts were not allowed and asked her to go home and change. When he asked how long it would take her to change and come back, she quit.
In Westminster, England, magicians video bombing a news report make it interesting.Read more >

In Hernando County, Florida, a driver refused to move his SUV from the sidewalk right outside the main entry and exit door at the county jail. After multiple refusals, he backed up into a bench and then accelerated forward, driving through the jail’s lawn, according to the local ABC News station. He then turned back toward the jail and deputies said he took aim with his vehicle at a deputy’s patrol car. The man turned abruptly, drove in a circle and struck a flagpole. He was ordered from the vehicle and taken into custody.

On I-65 in Indiana, a state trooper pulled over a man for speeding. The man was traveling with his daughter who has Down Syndrome. The trooper decided to make the daughter a state trooper for five minutes and asked her whether she wanted to issue her dad a warning or a ticket. The girl chose a ticket. However, the good-hearted trooper only issued a warning. The Indiana State Police responded to the man’s post about the incident that they are glad the daughter is on their side.

Have a great weekend, everyone!
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 alison.mintzer@strategic-i.com

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