Newsdash Insight on Plan Design & Investment Strategy from PLANSPONSOR
March 11th, 2019
Benefits & Administration
Fewer Households Expected to Face Retirement Savings Shortfall
The EBRI Retirement Security Projection Model (RSPM) found that for 2019, 40.6% of all U.S. households where the head of the household is between 35 and 54 are projected to run short of money in retirement, down slightly from 42.3% in 2014. In line with this, the aggregate retirement deficit of American households in this age cohort, including Social Security benefits, is estimated to be $3.83 trillion, down 15.9% from $4.44 trillion in 2014. However, when pro rata reductions in Social Security retirement benefits are assumed to begin in 2034, the aggregate retirement deficit increases by 6% to $4.06 trillion. Read more >
Navigating RMDs
Certain retirement plan participants who turned 70 ½ in 2018 must take their first required minimum distribution (RMD) by April 1. Here’s what plan sponsors need to know about RMD rules. Read more >
Products, Deals and People
Retirement Industry People Moves
GoldPoint Partners Appoints Managing Principle; Jennison Associates Names Sales and Client Services Manager; IRI Promotes Former Legal and Governmental Industry Experts; and more. Read more >
MOST READ ARTICLES
1
2019 Plan Sponsors of the Year
2
401(k) Nondiscrimination Tests Explained
3
Newport Group Picks Up Recordkeeping Business of PNC Bank
4
Why Plan Sponsors Should Consider Adding an ‘In-Retirement’ Tier in 2019
5
AAA Subsidiary Announces Student Loan Repayment Benefit for Its Employees
Economic Events

Total nonfarm payroll employment changed little in February (+20,000), and the unemployment rate declined to 3.8%, according to the Bureau of Labor Statistics (BLS). Employment in professional and business services, health care, and wholesale trade continued to trend up, while construction employment decreased.

 

Privately‐owned housing starts in January were at a seasonally adjusted annual rate of 1,230,000, the U.S. Census Bureau and the U.S. Department of Housing and Urban Development jointly announced. This is 18.6% above the revised December estimate of 1,037,000, but is 7.8% below the January rate of 1,334,000. Single‐family housing starts in January were at a rate of 926,000; this is 25.1% above the revised December figure of 740,000. The January rate for units in buildings with five units or more was 289,000.

 

THE ECONOMIC WEEK AHEAD: Today, the Census Bureau will report about retail sales for January and business trade for December. Tomorrow, the BLS will reveal the consumer price index for February. Wednesday, the Census Bureau will report about durable goods orders for January and the BLS will reveal the producer price index for February. Thursday, the Labor Department will issue its initial claims report, and the Census Bureau will report about new home sales for January.

Market Mirror

Friday, the Dow was down 22.99 points (0.09%) at 25,450.24, the NASDAQ closed 13.32 points (0.18%) lower at 7,408.14, and the S&P 500 lost 5.86 points (0.21%) to finish at 2,743.07. The Russell 2000 decreased 1.74 points (0.11%) to 1,521.88, and the Wilshire 5000 fell 60.74 points (0.21%) to 28,402.26.

 

The price of the 10-year Treasury note was up 2/32, decreasing its yield to 2.633%. The price of the 30-year Treasury bond increased 7/32, bringing its yield down to 3.016%.

 

WEEK’S WORTH: For the week ending March 8, the Dow decreased 2.21%, the NASDAQ lost 2.46%, and the S&P 500 was down 2.16%. The Russell 2000 fell 4.26%, and the Wilshire 5000 finished 2.41% lower.

Compliance
Multiemployer Pension Plans Need Financial Help or a New Investment Model
In a hearing, lawmakers heard about how the multiemployer pension plan crisis is affecting employers, employees and the economy today, why current legislation contributes to the crisis, and suggestions for moving forward. Read more >
PBGC Gets Administration Support
Among a host of other services, Serco Inc. will operate the Pension Benefit Guaranty Corporation’s (PBGC)’s contact center and help find pension plan participants. Read more >
Small Talk

ON THIS DATE: In 1824, the U.S. War Department created the Bureau of Indian Affairs. Seneca Indian Ely Parker became the first Indian to lead the Bureau. In 1861, a Confederate Convention was held in Montgomery, Alabama, where a new constitution was adopted. In 1865, Union General William Sherman and his forces occupied Fayetteville, North Carolina. In 1901, U.S. Steel was formed when industrialist J.P. Morgan purchased Carnegie Steep Corp. In 1904, after 30 years of drilling, the north tunnel under the Hudson River was holed through. The link was between Jersey City, New Jersey, and New York City. In 1927, Samuel Roxy Rothafel opened the famous Roxy Theatre in New York City. In 1930, Babe Ruth signed a two-year contract with the New York Yankees for the sum of $80,000. In 1930, President Howard Taft became the first U.S. president to be buried in the National Cemetery in Arlington, Virginia. In 1941, President Franklin D. Roosevelt authorized the Lend-Lease Act, which authorized the act of providing war supplies to the Allies. In 1964, U.S. Senator Carl Hayden broke the record for continuous service in the Senate. He had worked 37 years and seven days. In 1969, Levi-Strauss started selling bell-bottomed jeans. In 1993, Janet Reno was unanimously confirmed by the U.S. Senate to become the first female attorney general. In 2002, two columns of light were pointed skyward from ground zero in New York City as a temporary memorial to the victims of the terrorist attacks of September 11, 2001.

SURVEY SAYS RESPONSES: Last week, I asked NewsDash readers, “Who taught you about financial matters?” Three-quarters of responding readers indicated that their parents taught them about financial matters, while 39.7% said they learned from books or article authors and 38.2% learned from employers. Comments left by readers provided two other potential sources for financial education—churches/mosques/synagogues and co-workers. A couple mentioned their spouse, but that would fall in the category of “other family members.” A few say the sources they chose taught them what not to do. Others provided specific examples of how their parents taught them about financial matters. Editor’s Choice goes to the reader who said: “I remember clearly my parents sitting at the kitchen table every month writing out the budget for the next month. Top bill to be paid – the mortgage. Last category to be funded – entertainment. The food budget was somewhere in the middle. We never went hungry but creamed beef on toast was a regular month end meal. Powerful lessons – they worked on the budget together and eating out was not the priority.” 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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