Newsdash Insight on Plan Design & Investment Strategy from PLANSPONSOR
June 23rd, 2017
Benefits & Administration
An analysis covering the years 2006 through 2014 shows most of the 160 plans studied received insufficient employer contributions to maintain their unfunded liabilities.   Read more >
Targeted Communication Key to Boosting Deferral Rates
Most Americans are unsure about how much of their pay they should use to fuel a retirement savings vehicle. Based on research conducted within its own recordkeeping platform, Ascensus found that even though deferral rates continue to steadily increase as people age, the average rate across all generations is “surprisingly low” at 5.5%. However, certain steps can be taken to address this issue. The firm concludes that targeted communication, education, technology and auto-enrollment together can have a significant impact on motivating participants to increase contribution rates. Read more >
MOST READ ARTICLES
1
SECURE Act Passes House, Bringing Calls for Senate Collaboration
2
J.P. Morgan Agrees to Settle Stable Value Funds Suit
3
Individuals, Employers and Government All Play a Part in Retirement Readiness
4
Participant Loans: A Fiduciary Storm Brewing?
5
What to Know About Financial Audits Filed with Form 5500s
Pension Cuts Have Public Employees Worried
While it might be assumed that public employees, such as teachers, police and firefighters, are well covered by their pensions, they worry about their life in retirement, according to a survey by Prudential Retirement. Only 17% are very confident that they will have enough money to last them in the future.   Read more >
Pre-retirees Unsure About Executing Retirement Income Strategies
Unlike their younger counterparts, individuals nearing or in retirement don’t have the luxury of long time horizons in which to grow their nest eggs. They are at a point where developing a strategy to sustain their assets and draw retirement income is critical. However, many lack the knowledge to do so effectively, a study finds.   Read more >
Employers Disagree With Potential Pre-Tax Contribution Decrease
A new survey from the Plan Sponsor Council of America (PSCA) highlights the large percentage of plan sponsors not in favor of potential modifications regarding tax treatment of retirement savings plans. The report provides insight from 443 plan sponsors, surveyed in May 2017, to help retirement plan professionals understand how reducing or even eradicating pre-tax contributions in qualified retirement plans under 401(k) and 403(b) tax plans would impact employers and employees.   Read more >
Sponsored message from Natixis
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Economic Events

In the week ending June 17, the advance figure for seasonally adjusted initial claims for unemployment insurance was 241,000, an increase of 3,000 from the previous week’s revised level of 238,000, the Labor Department reported. The four-week moving average was 244,750, an increase of 1,500 from the previous week’s revised average of 243,250. 

The average interest rate on a 30-year fixed-rate mortgage is 3.90%, down from 3.91% one week ago, according to Freddie Mac. The average interest rate for a 15-year fixed-rate mortgage is 3.17%, down from 3.18%.

Market Mirror

Thursday, the Dow was down 12.74 points (0.06%) at 21,397.29, the NASDAQ was up 2.73 points (0.04%) at 6,236.69, and the S&P 500 decreased 1.11 (0.05%) to 2,434.50. The Russell 2000 closed 5.28 points (0.38%) higher at 1,404.53, and the Wilshire 5000 increased 9.16 points (0.04%) to 25,280.48.

The price of the 10-year Treasury note was up 4/32, decreasing its yield to 2.149%. The price of the 30-year Treasury bond increased 8/32, bringing its yield down to 2.718%.

Compliance
Suit Challenging Voya’s Relationship With Financial Engines Dismissed
A federal judge has dismissed a lawsuit claiming Voya Financial and Voya Retirement Advisors (VRA) engaged in prohibited transactions in violation of the Employee Retirement Income Security Act (ERISA) through a service arrangement with Financial Engines. The lawsuit challenged fees Voya Retirement Advisors received when using Financial Engines to provide investment advice to retirement plan participants. Voya Retirement Advisors was found not to be an ERISA fiduciary with respect to its compensation in an agreement with Nestle’s 401(k) plan. Read more >
Judge Dismisses ERISA Suit Against Fidelity Stable Value Decisions
A judge has dismissed an Employee Retirement Income Security Act (ERISA) lawsuit filed against Fidelity Management Trust Company over the management and monitoring of a stable value fund offered to 401(k) plans. The suit, Ellis vs. Fidelity Management Trust Co., accused Fidelity of engaging in imprudent investment strategies for the Fidelity Group Employee Benefit Plan Managed Income Portfolio Commingled Pool (MIP), a stable value fund offered as an investment option in some 401(k) plans for which Fidelity was trustee.   Read more >
Small Talk

ON THIS DATE: In 1836, the U.S. Congress approved the Deposit Act, which contained a provision for turning over surplus federal revenue to the states. In 1865, Confederate General Stand Watie, who was also a Cherokee chief, surrendered the last sizable Confederate army at Fort Towson, in the Oklahoma Territory. In 1868, Christopher Latham Sholes received a patent for an invention that he called a “Type-Writer.” In 1947, the U.S. Senate joined the House in overriding President Harry Truman’s veto of the Taft-Hartley Act. In 2004, the U.S. proposed that North Korea agree to a series of nuclear disarmament measures over a three-month period in exchange for economic benefits. In 2005, Roger Ebert received a star on the Hollywood Walk of Fame.

 

And now it’s time for FRIDAY FILES!

Metallica is a band for all ages.   Read more >
The President of Costa Rica swallowed a wasp during an interview and was unfazed.   Read more >

In Winfield, West Virginia, a man returned home to find a glass door broken at his residence. After going in, he also found a man asleep in his bed. Responding deputies arrested the man, who was charged with burglary and destruction of property, according to WSAZ-TV.

In Hamburg, Germany, news agency dpa reports that Hamburg’s fire service said it was called to the St. Michaelis church by a man who reported seeing white smoke rising from the tower. Firefighters who rushed to the scene couldn’t see any smoke. They combed the tower before finding the cause of the scare: a large swarm of gnats that apparently looked like smoke from the ground.

In Los Angeles, California, two boys and a girl ages 15, 16 and 17 in a program for those who may want to one day become police officers used a vacationing sergeant’s name to sign out stun guns and radios and drive police cars out of a stationhouse parking lot, the Associated Press reports. Police are investigating whether the teens impersonated officers and pulled over drivers. The three were arrested after two pursuits ended with crashes in South Los Angeles. A third police car was later recovered around the corner from a police station.

In Northampton, Massachusetts, a man complained to the city parking division that he paid $1 to park when he and his wife went out to dinner. According to The Daily Hampshire Gazette, the man said he put the money in a payment kiosk at 6:15 p.m., not knowing the city stops parking enforcement at 6:00 p.m. The mayor sent the man $1 out of his own pocket, along with an apology letter. The man said his complaint wasn’t about his dollar, but about the “thousands of people who have lost the dollar” because they were unaware of city parking rules.

In California, an automatically generated report from the U.S. Geological Survey indicated that a magnitude 6.8 quake would occur in the Pacific Ocean 10 miles west of Santa Barbara. However, the alert was about an earthquake that happened in 1925. According to the Huffington Post, newspapers and news agencies had to rescind their alerts. The false alarm may have been generated because researchers from the California Institute of Technology were using new information to analyze the epicenter of the 1925 earthquake in the Santa Barbara Channel.


Have a great weekend!

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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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