Newsdash Insight on Plan Design & Investment Strategy from PLANSPONSOR
May 21st, 2018

2018 Plan Sponsor of the Year: Landscape Structures

Since 2016, Landscape Structures Inc. has paid much more attention to plan-success benchmarks. Defining and tracking retirement readiness for this Delano, Minnesota, playground product manufacturer’s work force has helped both employees and employer. Read more >
Compliance
District Court Admits Error in ERISA Lawsuit Ruling
The U.S. District Court for the Middle District of Pennsylvania has ruled in an Employee Retirement Income Security Act (ERISA) lawsuit targeting WellSpan Good Samaritan Hospital, an acute care hospital in Lebanon, Pennsylvania. The district court’s new decision comes after its previous move denying the hospital defendants’ motion for summary judgment to toss plaintiffs’ claims, which cover a variety of fiduciary breach allegations. Specifically, the district court’s new decision says it will fully reconsider its ruling to deny summary judgement on behalf of defendants, essentially because the court confused subtle elements of Third Circuit case law. Read more >
ERISA Excessive Fee Suit Filed Against University of Rochester
A participant in the University of Rochester Retirement Program has filed a lawsuit alleging that plan participants have paid an estimated $72 million in in recordkeeping, distribution, and mortality risk fees to provider TIAA. The lawsuit claims that since the University of Rochester’s 403(b) plan has more than $4.2 billion in assets, it has tremendous bargaining power to demand low-cost, high-quality administrative services; however, it instead has failed to adequately take proper measures to understand the real cost to plan participants for TIAA’s services, to properly inform participants of the fees they were paying to TIAA as required by law, and to act prudently with such information. Read more >
Products, Deals and People
Retirement Industry People Moves
CalPERS CIO to leave fund; P-Solve rebrands to River and Mercantile Solutions; Trinity Pensions Consultants opens Indianapolis sales office; and more. Read more >
MOST READ ARTICLES
1
IRS Announces 2019 HSA Contribution Limits
2
4% Rule Not a Reliable Retirement Income Withdrawal Strategy for All People
3
Lawsuit Argues MetLife Pension Calculations Use Outdated Mortality Table
4
401(k) Plan Sponsors Enhancing Plan Design
5
Duke University 403(b) Plan Lawsuits Reportedly Settled
Market Mirror

Friday, the Dow was virtually unchanged at 24,715.09, the NASDAQ decreased by 28.13 points (0.38%) to 7,354.34, and the S&P 500 was down 7.16 points (0.26%) at 2,712.97. The Russell 2000 increased by 1.34 (0.08%) to 1,626.63, and the Wilshire 5000 closed 62.25 points (0.22%) lower at 28,266.59.

 

The price of the 10-year Treasury note increased 14/32, bringing its yield down to 3.061%. The price of the 30-year Treasury bond climbed 29/32, decreasing its yield to 3.200%.

 

WEEK’S WORTH: For the week ending May 18, the Dow decreased 0.47%, the NASDAQ lost 0.66%, and the S&P 500 finished 0.54% lower. The Russell 2000 gained 1.23%, and the Wilshire 5000 was down 0.31%.

Sponsored message from Vanguard
Snapshots of TDF performance miss the big picture
When evaluating TDF performance, use a holistic approach to look beyond a single point in time. Read more >
Economic Events

THE ECONOMIC WEEK AHEAD: Wednesday, the Census Bureau will report about new home sales for April. Thursday, the Labor Department will issue its initial claims report, and the National Association of Realtors will report about existing home sales in April. Friday, the Census Bureau will report about durable goods orders for April.

Investing
Is There Any Hope for 403(b)s to Be Able to Use CITs?
With excessive fee lawsuits extending to the 403(b) space, and account assets growing larger with time, 403(b) plan sponsors are inquiring about offering collective investment trusts (CIT)s on their plan menu—which are like mutual funds, but tend to be at a lower cost. These lower-cost funds are growing more popular in the 401(k) market, but are not available to most 403(b) plans. Read more >
Small Talk

ON THIS DATE: In 1542, Hernando de Soto died along the Mississippi River while searching for gold. In 1819, bicycles were first seen in the U.S. in New York City. In 1832, in the U.S., the Democratic Party held its first national convention. In 1863, the siege of the Confederate Port Hudson, Louisiana, began. In 1881, the American branch of the Red Cross was founded by Clara Barton. In 1904, Fédération Internationale de Football Association (FIFA) was founded. In 1927, Charles A. Lindberg completed the first solo nonstop airplane flight across the Atlantic Ocean. The trip began May 20. In 1956, the U.S. exploded the first airborne hydrogen bomb in the Pacific Ocean over Bikini Atoll. In 1970, the National Guard was mobilized to quell disturbances at Ohio State University.

SURVEY SAYS RESPONSES: Last week, I asked NewsDash readers to put their plan participant “hats” on, and choose from a list which underutilized retirement program feature or other benefits would help them the most in reaching their retirement savings goal? From the list of underutilized retirement program features or other benefits, the one identified as helpful by the most respondents was auto escalation of deferral rate, cited by 39.4% of responding readers. This was followed closely by a stretched match formula, selected by 33.3% of respondents. More than one-quarter (27.3%) chose personalized retirement communications, while 21.2% selected a student loan repayment benefit. A couple of respondents who chose to leave comments about underutilized retirement program features or other benefits said an overall financial wellness program would help and a defined benefit plan would help. The importance of automatic enrollment was mentioned, though it is no longer considered an underutilized plan feature. And one commenter explained why underutilized plan features are underutilized. Editor’s Choice goes to the reader who said: “I would love to see auto-escalation tied in with timing of wage increases. Timing with raises would make it painless as more money would go to retirement at the same time more money goes into your pocket.” A big 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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