| | Benefit Briefs | | Employers Seek to Control Benefits Costs and Risks | | Employers mark controlling health care costs as
their top benefits priority, followed closely by controlling costs and risks
for retirement plans, says a new report from Prudential Financial. More than
half of employers say they are likely to offer lump-sum distributions to DB
plan participants over the next two years. More than half of employers believe
a significant portion of their work force will have to delay retirement because
of inadequate savings; 59% say they have seen the average retirement age
increase over the past five years, and 61% believe it will continue to rise. | | Responding to Lagging 401(k) Participant Engagement | | The severity of the Great Recession seems to
have diminished overall participant engagement with 401(k) plans, according to
an analysis by Putnam. The firm says financial communications need to evolve
and adopt the online marketing practices that touch savers every day. In
addition, plan providers have access to a wealth of data about savers,
including age, compensation and deferral rates. Presenting personalized,
actionable messages in the context of lifetime income could provide the “nudge”
needed to increase engagement. | | Good Retirement Savings, Health Habits Connected | | Researchers at St. Louis, Missouri’s Washington
University have found a connection between good retirement savings habits and
good health habits. In “Healthy, Wealthy, and Wise: Retirement Planning
Predicts Employee Health Improvements,” Lamar Pierce, associate professor of
strategy at the university’s Olin Business School, and doctoral candidate
Timothy Gubler find an employee’s decision to contribute to a 401(k) retirement
plan predicted whether he or she would act to correct poor physical health
indicators that were revealed during an employer-sponsored health examination. | | | Buyer’s Market | | Eighty-eight percent of the assets represented
in PLANSPONSOR’s 2014 Recordkeeping Survey are in 401(k), 403(b) and 457
plans—a jump of more than 20% from 2012 for those plan types. The number of
such plans also increased, but only by a marginal 0.6%. | | | Market Mirror | | Yesterday, the Dow was down 44.05 points
(0.26%) at 17,024.21, the NASDAQ fell 34.40 points (0.77%) to 4,451.53, and the
S&P 500 closed 7.79 points (0.39%) lower at 1,977.65. The Russell 2000 lost
20.50 points (1.70%) to finish at 1,187.65, and the Wilshire 5000 decreased
128.18 points (0.61%) to 20,979.36.
On the NYSE, 3.2 billion shares traded,
with declining issues outnumbering advancing issues more than 2 to 1. On the
NASDAQ, 2.8 billion shares changed hands, with a near 4 to 1 lead for
decliners.
The price of the 10-year Treasury note was up 5/32,
bringing its yield down to 2.620%. The price of the 30-year Treasury bond increased
17/32, decreasing its yield to 3.442%.
| | | Rules & Regulators | | Health Plan to Repay Clients for Undisclosed Fees | | A group health plan will repay clients for
failing to disclose fees to them. Under a consent judgment from the U.S.
District Court for the District of Minnesota, the Pro Systems Corp. Group
Health Plan will restore $203,212 to clients to resolve a lawsuit, Perez v. Pro Systems Corp, et al, filed
with the court by the Department of Labor (DOL). The suit alleged violations of
the Employee Retirement Income Security Act (ERISA) for failing to disclose to
clients that some fees collected for insurance costs were used for purposes
unrelated to the health plan. | | GAO Recommends Changes to Form 5500 | | The Government Accountability Office (GAO) is
recommending that regulators consider modifying Form 5500 plan investment and
service provider fee information. Stakeholders interviewed by the agency said the form’s
information about service provider fees was misaligned with other required fee
disclosures, and also cited various exceptions and gaps in current reporting
requirements as major challenges. Specifically, the stakeholders said Form 5500
service provider fee information does not align with other information that service
providers must disclose to plan sponsors, forcing providers to produce two
different sets of information. | | | Financial Sense | | Financial Savviness Linked to Better 401(k) Returns | | Employees who improve their financial knowledge
have a better chance of improving the investment returns on their retirement
accounts, a paper published by the National Bureau of Economic Research (NBER)
suggests. The research report, “Financial Knowledge and 401(k) Investment
Performance,” says risk-adjusted annual expected returns are 130 basis points
higher for the most financially knowledgeable retirement plan participant than
for the least financially knowledgeable. The more financially knowledgeable
participants hold more equity in their portfolios, and hence can expect higher
risk-adjusted returns. The most knowledgeable hold 11.5% more stock than their
least knowledgeable counterparts and they can anticipate earning around 10%
more, the research found. | | | Small Talk | | ON
THIS DATE: In
1776, a 2,000-pound copper-and-tin
bell now known as the “Liberty Bell” rang out from the tower of the
Pennsylvania State House (now Independence Hall) in Philadelphia, summoning
citizens to the first public reading of the Declaration of Independence. In 1889, The Wall Street Journal was first
published. In 1972, “Lean On Me”
by Bill Withers began its first stay at No. 1 on the pop charts.
TUESDAY
TRIVIA: The first automatic telephone answering machine,
invented by Willy Müller in 1935, was a three-foot-tall device.
| | TRIVIAL PURSUITS: Which
state has the smallest 65-and-older population? | | Share the good news with a friend! Pass the Dash along – and tell your
friends/associates they can sign up for their own copy. | | News from PLANSPONSOR.com
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