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| Market Mirror | |
Friday, the Dow inched up 20.32 points (0.11%) to 18,272.56, the NASDAQ was down 2.50 points (0.05%) at 5,048.29, and the S&P 500 increased by 1.63 points (0.08%) to 2,122.73. The Russell 2000 decreased by 1.16 points (0.09%) to 1,243.95, and the Wilshire 5000 was up 15.12 points (0.07%) at 22,402.17. On the NYSE, 3.2 shares changed hands, with 1.4 advancing issues for every declining issue. On the NASDAQ, 2.8 billion shares traded, with a slight lead for decliners. The price of the 10-year Treasury bond increased 25/32, bringing its yield down to 2.146%. The price of the 30-year Treasury bond climbed 2 8/32, decreasing its yield to 2.931%. WEEK’S WORTH: For the week ending May 15, the Dow finished 0.45% higher, the NASDAQ climbed 0.89%, and the S&P 500 was up 0.31%. The Russell 2000 gained 0.73%, and the Wilshire 5000 increased 0.37%. | |
| Compliance | |
| Legislation Supports Lifetime Income Disclosures | |
| U.S. Senators Johnny Isakson (R-Georgia) and Chris Murphy (D-Connecticut) have introduced a bill they are calling the Lifetime Income Disclosure Act, which would require 401(k) plan sponsors “to inform participating workers of the projected monthly income they could expect at retirement based on their current account balance.” The senators say they have garnered significant bipartisan support for the bill, which they believe will help average Americans ensure they do not outlive their savings in retirement.Read more > | |
| Church Plan Case Reaches Settlement | |
| A federal district court judge has preliminarily approved a settlement in one of the cases challenging a retirement plan’s church plan status. Last May, U.S. District Judge Avern Cohn of the U.S. District Court for the Eastern District of Michigan found the retirement plans of Ascension Health Alliance entities qualify for “church plan” status under the Employee Retirement Income Security Act (ERISA). The ruling is one of three handed down so far that say a plan need not be established by a church in order to qualify as a church plan. So far, courts are split in their decisions about church plan cases. The key concept of the settlement agreement is that the participants in the plans will receive certain Employee Retirement Income Security Act (ERISA)-like protections for the next seven and one-half years, the agreement says.Read more > | |
| From the Magazine | |
| 403(b) Plan Issues | |
| Until January 1, 2009, Internal Revenue Service (IRS) rules allowed 403(b) participants to choose their own plan provider. For sponsors of 403(b) retirement plans, this has left a legacy of grappling with how to handle information sharing among multiple providers.Read more > | |
| Small Talk | |
| ON THIS DATE: In 1860, Abraham Lincoln, a one-time U.S. representative from Illinois, was nominated for the U.S. presidency by the Republican National Convention meeting in Chicago. In 1917, six weeks after the United States formally entered the First World War, the U.S Congress passed the Selective Service Act, giving the U.S. president the power to draft soldiers. In 1980, Mt. Saint Helens erupted in Washington state; 57 people were killed and 3 billion in damage was done. In 1983, the U.S. Senate revised immigration laws and gave millions of illegal aliens legal status under an amnesty program. In 1998, the U.S. federal government and 20 states filed a sweeping antitrust case against Microsoft Corp., saying the computer software company had a “choke hold” on competitors which denied consumer choices by controlling 90% of the software market. | |
| SURVEY SAYS: Moving from a DB to a DC Plan | |
| Last week, I asked NewsDash readers, “Have you ever participated in a DB plan, and how did a move from a DB to a defined contribution (DC) affect you?” Nearly one-quarter of responding readers (24.3%) indicated they are not now and have never been a participant in a defined benefit (DB) pension plan. Slightly more than 10% are in plans that are still active. Nearly 19% said they are or have been in a DB plan that is closed to new participants, but still accruing benefits, 24.3% are or have been in a that is now frozen, 21.6% in a plan that is now terminated. Among those in a DB plan that is no longer active, 57.7% reported their employers added or enhanced a defined contribution (DC) plan when it changed the DB, 23.1% said their employers added a DC plan. As a participant, nearly half (48.1%) of responding readers felt the move away from DB towards DC diminished their retirement benefit. In comments, a few people left tips for plan sponsors moving from a DB to a DC—and the top tip was to communicate well. Most readers acknowledged that the move usually means a decrease in benefits, and one lucky reader expressed, “I love my DB plan. I hope they keep it active for the next 8 years until I retire!” Editor’s Choice is a tie between, “DB plans? Yeah, right…next you’ll be telling us that elves and dragons actually existed!” and “Please no more lime green backgrounds on these surveys. It hurts the eyes!” A big thank you to all who responded to the 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 > | |
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Editorial: Alison Cooke Mintzer alison.mintzer@strategic-i.com
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