Newsdash Insight on Plan Design & Investment Strategy from PLANSPONSOR
March 19th, 2015
Benefits & Administration
Women Need Retirement Planning Nudge
LIMRA research consistently shows that the top financial concern for both women and men is saving enough money for retirement (83% of women compared to 77% of men). But, taking action to prepare for retirement seems especially hard for women. Only 20% of women surveyed indicated they are comfortable with their level of financial knowledge. In addition, LIMRA finds that women are less likely than men to have done basic retirement planning activities.Read more >
Assets held in employer-sponsored retirement plans increased 11.5% to reach $11.3 trillion at the close of 2014, according to Spectrem’s 2015 Market Insights Report. Individual retirement accounts (IRAs) maintain an additional $5.4 trillion of savings, Spectrem says. According to the report, total retirement assets across public plans, private plans and IRAs stand around $21.5 trillion.Read more >
Employee Financial Stress Levels Creep Higher
Student loan debt, mortgages and health care costs are the biggest financial stressors for workers, according to the State Street Global Advisors (SSgA) retirement survey, which finds no age group is immune to financial stress. In addition, many employees expressed an unsettled feeling of not having done enough to prepare for retirement. It’s common knowledge that financial concerns are usually top of mind for individuals and families, says Fredrik Axsater, global head of defined contribution at SSgA, but the survey’s findings demonstrate the level of concern individuals have about finances. “Financial and workplace stressors have the greatest impact on work quality and productivity, which confirms what we are hearing from employers—we need to address workplace financial demands beyond retirement savings,” Axsater maintains.Read more >
Products, Deals & People
ERISApedia.com has begun publishing the Fiduciary Responsibility eSource, a publication that provides guidance for 401(k) and 403(b) plan advisers and sponsors. Burrmont Compliance Labs LLC announced the rollout of the book, written by Employee Retirement Income Security Act (ERISA) and former Internal Revenue Service (IRS) and Labor Department attorney, Charles Humphrey. The ERISApedia.com platform, which provides compliance information and retirement industry materials to sponsors, administrators, attorneys and advisers, allows Humphrey to update content as developments arise.Read more >
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Vanguard Rolling Out Plan Sponsor Workstation
Vanguard has announced a new tool, My Plan Manager, designed to make retirement plan sponsors’ plan data more accessible and actionable so they can help participants reach retirement goals. The first capabilities will include a deepened set of employee information, as well as a list builder and expanded reporting functions that let plan sponsors easily target employee segments based on selected criteria. Kathy Himsworth, a principal in recordkeeping services at Vanguard Institutional Investor Group in Valley Forge, Pennsylvania, explains to PLANSPONSOR that the platform will make all information about a client’s plans and participants available at their fingertips. With the list builder they can set parameters to get information about a subset of participants, she adds.Read more >
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Market Mirror

Major U.S. stock indices ended higher Wednesday after the Federal Open Market Committee said it will not raise interest rates until it sees job market improvement and higher inflation. The Dow climbed 227.11 points (1.27%) to 18,076.19, the NASDAQ increased 45.39 points (0.92%) to 4,982.83, and the S&P 500 closed 23.85 points (1.15%) higher at 2,098.13. The Russell 2000 was up 9.90 points (0.80%) at 1,252.13, and the Wilshire 5000 gained 252.67 points (1.15%) to finish at 22,216.60.

On the NYSE, 3.2 billion shares traded, with a more than 4 to 1 lead for advancers. On the NASDAQ, 2.8 billion shares changed hands, with 1.6 advancing issues for every declining issue.

The price of the 10-year Treasury note increased 1 7/32, bringing its yield down to 1.917%. The price of the 30-year Treasury bond climbed 2 2/32, decreasing its yield to 2.504%.

Compliance
DOL Adds Flexibility to Investment Disclosure Rules
The U.S. Department of Labor’s Employee Benefits Security Administration (EBSA) announced a direct final rule that provides a two-month grace period for participant-directed individual account plans, such as 401(k)s, to provide annual investment and plan-related information to participants. According to EBSA, the rule changes the requirement that annual disclosures be made at least once in any 12-month period to at least once in any 14-month period.Read more >
DOL Alleges Company ESOP Creation Was Flawed
Accurate company valuations are critical when it comes to establishing an employee stock ownership plan (ESOP), the Department of Labor (DOL) says in an enforcement action announcement. The DOL contends that, when establishing an ESOP, a company’s owner sought to inflate the company’s stock price to benefit himself. The department filed a lawsuit in federal court against Dr. Roy Geronemus, owner of the Manhattan-based Laser and Skin Surgery Center of New York, and plan trustee Samuel Ginsberg, alleging the stock valuation process when setting up the Laser Skin and Surgery Center ESOP in 2009 was flawed, and the ESOP’s subsequent $24 million purchase of the stock violated the Employee Retirement Income Security Act (ERISA).Read more >
Small Talk
ON THIS DATE: In 1628, the Massachusetts colony was founded by Englishmen. In 1895, the Los Angeles Railway was established to provide streetcar service. In 1918, the U.S. Congress approved Daylight-Saving Time. In 1953, for the first time, audiences were able to sit in their living rooms and watch as the movie world’s most prestigious honors, the Academy Awards, were given out at the RKO Pantages Theatre in Hollywood, California. In 1977, the last episode of “The Mary Tyler Moore Show” aired. In 2002, actor Ben Kingsley was knighted by Queen Elizabeth II at Buckingham Palace. In 2003, the United States, along with coalition forces primarily from the United Kingdom, initiated war on Iraq.
SURVEY SAYS: There are many ways retirement plan sponsors and those that serve them can keep themselves up-to-date on plan design and administrative trends and best practices, as well as new rules and legislation. This week, I’d like to know, how do you keep yourself educated about these things? You may respond to this week’s survey by 6 p.m. Pacific time today.Read more >
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