| Benefits & Administration | Financial Education Over Time Improves Savings | An analysis finds repeated use of financial
wellness resources improves retirement savings behaviors. According to
Financial Finesse’s 2014 Year in Review, repeat users made up 15% of all users
in 2014, up from 6% of all users in 2013. These employees show improvement in
key areas of financial wellness that is far above the improvement seen in the
general population. For example, 46% of repeat users indicated in their last
assessment that they feel confident their investments are allocated
appropriately, compared to 31% in their first assessment.Read more > | All Age Groups May Have Misguided Retirement Ideas | On average, workers of all ages estimate that
they will need $1 million of savings to feel financially comfortable in
retirement, according to the 16th Annual Retirement Survey from the
Transamerica Center for Retirement Studies. The majority of Americans in each
age group surveyed—20-, 30-, 40-, 50- and 60-somethings—reported that they are
currently saving toward that target, and the most commonly cited goal for their
golden years was to spend the time traveling. Their most common fear is
outliving their money, and 20% overall report that getting out of credit card
debt is their top financial priority. These similarities among the ages, on
their own, are not surprising—cruises have been popular since the Titanic hit
movie theaters; Millennials have tattoos of maps and compasses; and many
respondents were probably solicited for their first credit card in college or
even high school. However, each age group presents a unique opportunity to
improve retirement planning.Read more > | | Economic Events | Total nonfarm payroll employment
increased by 223,000 in April, and the unemployment rate was essentially
unchanged at 5.4, according to the Bureau of Labor Statistics. Job gains
occurred in professional and business services, health care, and construction.
Mining employment continued to decline.
THE
ECONOMIC WEEK AHEAD: Wednesday,
the Census Bureau will report about retail sales for April and business
inventories for March. Thursday, the
Labor Department will issue its initial claims report, and the Bureau of Labor
Statistics will reveal the producer price index (PPI) for April.
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| Market Mirror | The stock
market had its biggest gain in two months after the U.S. government reported an
encouraging pickup in hiring, the Associated Press reports. The Dow climbed
267.05 points (1.49%) to 18,191.11, the NASDAQ increased 58.00 points (1.17%)
to 5,003.55, and the S&P 500 gained 28.10 points (1.35%) to finish at
2,116.10. The Russell 2000 was up 9.39 points (0.77%) at 1,234.93, and the Wilshire
5000 closed 271.16 points (1.23%) higher at 22,319.28.
On the NYSE,
3.2 billion shares changed hands, with advancing issues outnumbering declining
issues 4 to 1. On the NASDAQ, 2.8 billion shares traded, with a 1.7 to 1 ratio
of advancers to decliners.
The price of
the 10-year Treasury note increased 12/32, bringing its yield down to 2.142%.
The price of the 30-year Treasury bond was up 9/32, decreasing its yield to
2.898%.
WEEK’S
WORTH: For the week ending May 8, the Dow gained
0.93%, the NASDAQ slipped 0.04%, and the S&P 500 increased 0.40%. The
Russell 2000 finished 0.56% higher, and the Wilshire 5000 was up 0.32%.
| | Compliance | Proposed Wellness Program Rules Leave Questions | “The idea [behind issuing proposed rules for
employer wellness programs] was to provide clarity and consistency, and while
the EEOC was conceptually in the neighborhood, it provided a little more
clarity, but a lot more inconsistency,” says Michael Dermer, chief incentive
officer at Welltok, a Denver-based wellness program provider. Dermer, based in
New York City, notes that the proposed rules recently issued by the Equal
Employment Opportunity Commission (EEOC) did not address issues with the
Genetic Information Nondiscrimination Act (GINA)—tying incentives to family
history information—and that was the basis for one of its claims in a lawsuit
against Honeywell International. He also tells PLANSPONSOR that if the proposal
is passed in its current form, it will establish two sets of rules, one for
outcomes-based incentives and one for participation-based incentives,
particularly when it comes to smoking cessation.Read more > | The Internal Revenue Service (IRS) Employee
Plans Compliance Unit conducted a project related to 403(b) plan sponsorship
eligibility for organizations that lost their 501(c)(3) exempt status due to
the automatic revocation for not filing a required return for three consecutive
years. Some entities were unaware that their 501(c) status affected their
eligibility to sponsor a 403(b) plan. Generally, all entities exempt from
federal income tax under Internal Revenue Code (IRC) Section 501(a) are
required to file an annual return reporting their operations and activities
under IRC Section 6033. Exempt entities must file an annual notice with the IRS
using a Form 990 series return.Read more > | IRS Sets 2016 HSA Limits | The Internal Revenue Service (IRS) issued
Revenue Procedure 2015-30, which provides the 2016 inflation adjusted amounts
for health savings accounts (HSAs) as determined under Section 223 of the
Internal Revenue Code.Read more > | | From the Magazine | If it were up to retirement plan advisers, the
single most important goal their plan sponsor clients would set for 401(k)
plans would be “outcomes”—enabling participants to retire with adequate
savings. “Achieving useful and successful retirement plans for the individual
is the pinnacle of what we are trying to establish,” says Dan Peluse, director
of corporate plan services at Wintrust Wealth Management in Chicago.Read more > | Are Your Education Initiatives Making a Difference? | In a day when many plan committees let
automation do the work of enrolling participants and building their retirement
accounts, educational initiatives especially may need to justify their cost. How
does a plan sponsor determine whether those efforts—be they a re-enrollment
meeting or the overall strategy—are a success?Read more > | | Investing | A recent report from Wintergreen Advisers argues
there is a critical flaw underlying the current trend of plan sponsors pushing
more and more assets into lower-fee index funds—a flaw that could be construed
as a fiduciary violation. The report’s title doesn’t mince words: “How the
Votes of Big Index Funds Feed CEO Greed and Put Americans’ Retirement Savings
in Peril.” Neither do David Winters, CEO of Wintergreen Advisers, and Liz
Cohernour, chief operating officer (COO) of Wintergreen, in discussing what
they see as major failures on the part of the big index fund providers to
ensure individual investors are treated fairly.Read more > | | Small Talk | ON THIS DATE: In
1858, Minnesota entered the Union as
the 32nd state. In 1927, the Academy
of Motion Picture Arts and Sciences was founded. In 1934, a massive storm sent millions of tons of topsoil flying from
across the parched Great Plains region of the United States as far east as New
York, Boston and Atlanta. In 1947, the
creation of the tubeless tire was announced by the B.F. Goodrich Company. In 1981,
Bob Marley, the soul and international face of reggae music, died in a Miami,
Florida, hospital at age 36. In 1997,
chess grandmaster Garry Kasparov resigned after 19 moves in a game against Deep
Blue, a chess-playing computer developed by scientists at IBM. This was the
sixth and final game of their match, which Kasparov lost two games to one, with
three draws. | In honor of Mother’s Day, last week, I asked
NewsDash readers, what is your favorite childhood memory of your Mom—it could
be rituals, quirks, sayings or a specific event. I was surprised by such a
small number of responses, but perhaps most readers were like the one who said:
“I went through many and couldn’t pick one ‘favorite’. Nice prep for Sunday!”
But, among the responses received, quite a few were touching and some were
funny. All responses remind us that Mom is special and there’s a reason we set
a day aside to celebrate her. There’s no Editor’s Choice this week—every comment tied. A big thank you to all who shared
in this week’s survey!Read more > | Share the good news with a friend! Pass the Dash along – and tell your
friends/associates they can sign up for their own copy.Read more > | News from PLANSPONSOR.com
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