Newsdash Insight on Plan Design & Investment Strategy from PLANSPONSOR
June 16th, 2015
Benefits & Administration
Deflecting the Global Wave of Retirement Unreadiness
Ed Farrington points to a February Time magazine cover—the picture of an infant, headlined: “This baby could live to be 142 years old.” That the baby looks worried may be incidental, but with longevity well outpacing saving around the globe, many countries have recognized they need to make adjustments—and some have already begun. How are other countries tackling the situation, and what might the U.S. learn from their efforts? Also, what can plan sponsors take from the discussion?Read more >
More than three-quarters (76%) of respondents to an Accenture survey of 2,709 employees view health insurance as a vital reason for continuing to work at their current employer, and 94% are confident their employer will continue to offer health coverage. If they did lose their insurance, nearly one-third (31%) say they would leave their employer within 12 months, with about half of those (15%) saying they would quit immediately.Read more >
Social Security Quiz Stumps Most Americans
Most people flunked a 10-question survey about Social Security commissioned by MassMutual. Only 28% of Americans received a passing grade when asked basic questions about Social Security, and only 8% said they are very knowledgeable about Social Security.Read more >
Employers are aiming to lower medical costs through plan changes including the addition of new options such as high-deductible health plans (HDHPs). While preferred provider organization (PPO) plans remain the plan type with the highest enrollment, this is the first year where PPO prevalence is less than 50%, according to PwC’s 2015 Health and Well-Being Touchstone Survey.Read more >
Products, Deals & People
Laura Grassi joins Pentegra Retirement Services as regional director for qualified plan sales. In her new role, Grassi will serve New York City, Long Island and New Jersey.Read more >
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Research
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Market Mirror

U.S. stock indices ended lower Monday as uncertainty mounts over Greece’s bailout talks with its creditors, according to the Associated Press. The Dow fell 107.67 points (0.60%) to 17,791.17, the NASDAQ decreased 21.13 points (0.42%) to 5,029.97, and the S&P 500 lost 9.68 points (0.46%) to finish at 2,084.43. The Russell 2000 was down 3.98 points (0.31%) at 1,261.04, and the Wilshire 5000 closed 94.32 points (0.43%) lower at 22,079.35.

On the NYSE, 3.2 billion shares traded, with decliners outnumbering advancers nearly 2 to 1. On the NASDAQ, nearly 2.9 billion shares changed hands, with 1.4 declining issues for every advancing issue.

The prices of the 10-year Treasury note and 30-year Treasury bond both increased 11/32, bringing their yields down to 2.358% and 3.090%, respectively.

Compliance
Employer Sued for Reducing Worker Hours After ACA
An employee of Dave & Buster’s Inc. in New York City has filed a lawsuit claiming the company violated the Employee Retirement Income Security Act (ERISA) Section 510 interference of benefits provisions when it reduced full-time employees’ hours following passage of the Patient Protection and Affordable Care Act (ACA).Read more >
Court Orders Trial for Determining Plan’s Top Hat Status
A federal court has determined there is inconclusive evidence regarding whether or not a wealth accumulation plan (WAP) offered to executives of RBC Capital Markets Corporation is a “top hat” plan, exempt from certain Employee Retirement Income Security Act (ERISA) provisions. There are still questions about the selectivity requirement for a plan to be considered a top hat plan. Since the issue is not clear, the U.S. District Court for the Southern District of Texas said the case must move to trial.Read more >
Investing
Institutional Investors Unprepared for Tail Risk
Nearly two-thirds (66%) of the 735 institutional investors surveyed by Allianz Global Investors think tail risk has become an increasing worry since the financial crisis. The majority of respondents, though, rely on traditional asset allocation and risk-management strategies to protect their portfolios, with 61% utilizing asset class diversification and 56% geographic diversification. With the inter-connectedness of markets, such diversification will become less effective in mitigating for drawdown risk, the firm says.Read more >
Strategic Insight (SI) reports net inflows across stock and bond fund investments totaled $21.7 billion during May—including a net intake for equity funds totaling $14.7 billion. International equity funds posted an impressive $25.9 billion inflow, while U.S. Equity funds saw monthly net outflows of $11.2 billion.Read more >
Small Talk

ON THIS DATE: In 1884, the first roller coaster in America opened at Coney Island, in Brooklyn, New York. In 1952, “Anne Frank: Diary of a Young Girl” was published in the United States. In 1968, golfer Lee Trevino won his first U.S. Open at the Oak Hill Country Club in Rochester, New York. In 1999, the U.S. Circuit Court of Appeals said that a 1992 federal music piracy law does not prohibit a palm-sized device that can download high-quality digital music files from the Internet and play them at home. In 2008, California began issuing marriage licenses to same-sex couples.

 

TUESDAY TRIVIA: The city of Sydney in Australia contains about one-fifth of the residents of the entire continent.

TRIVIAL PURSUITS: Which is hotter: a bolt of lightning or the sun?Read more >
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Editorial: Alison Cooke Mintzer alison.mintzer@strategic-i.com

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