Newsdash Insight on Plan Design & Investment Strategy from PLANSPONSOR
May 22nd, 2015
Benefits & Administration
Sponsors, Participants Warming Up to Income Options
LIMRA Secure Retirement Institute calculated that 3 million participants had access to an in-plan income guarantee through their employee-sponsored retirement plan in 2014, a 32% increase from 2013. In addition, there was a 24% rise in the number of participants electing an in-plan guarantee, to reach 71,300 in 2014. The study found small plans (with less than $10 million in assets) are most likely to offer in-plan guarantees.Read more >
Amid Challenges, Millennials Strive to Save
As Millennial workers are just getting started on a lifetime of saving, the industry has hopes that this generation—the first to be able to leverage a lifetime of 401(k) contributions—will be able to prepare adequately for retirement. Auto-features are a plan sponsor’s best resource for helping Millennials get the most out of the plan, says Judith Ward, a senior financial planner and vice president of T. Rowe Price investment services. “Millennials are using them, they need them, and they want more,” she told PLANSPONSOR during a roundtable discussion about the firm’s latest research.Read more >
Economic Events
Total existing-home sales, which are completed transactions that include single–family homes, townhomes, condominiums and co–ops, declined 3.3% to a seasonally adjusted annual rate of 5.04 million in April from an upwardly revised 5.21 million in March, the National Association of Realtors announced. Despite the monthly decline, sales have increased year–over–year for seven consecutive months and are still 6.1% above a year ago. In the week ending May 16, the advance figure for seasonally adjusted initial claims for unemployment insurance was 274,000, an increase of 10,000 from the previous week’s unrevised level of 264,000, the Labor Department reported. The four-week moving average was 266,250, a decrease of 5,500 from the previous week’s unrevised average of 271,750. This is the lowest level for this average since April 15, 2000, when it was 266,250. The average interest rate for a 30-year fixed-rate mortgage is 3.84%, down from 3.85% one week ago, according to Freddie Mac. The average interest rate for a 15-year fixed-rate mortgage is 3.05%, down from 3.07%.
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Market Mirror

U.S. stock indices closed mostly higher Thursday, led by an advance in energy stocks as the price of oil climbed, according to the Associated Press. The Dow was virtually unchanged at 18,285.74, the NASDAQ closed 19.05 points (0.38%) higher at 5,090.79, and the S&P 500 increased 4.97 points (0.23%) to 2,130.82. The Russell 2000 decreased 1.01 points (0.08%) to 1,256.72, and the Wilshire 5000 was up 44.36 points (0.20%) at 22,495.55.

On the NYSE, 3.2 billion shares changed hands, with 1.2 advancing issues for every declining issue. On the NASDAQ, 2.8 billion shares traded, with a nearly even split between advancers and decliners.

The price of the 10-year Treasury note increased 18/32, bringing its yield down to 2.187%. The price of the 30-year Treasury bond climbed 1 7/32, decreasing its yield to 2.987%.

Compliance
Advisers Charged with Defrauding Atlanta Pension Funds
The Securities and Exchange Commission (SEC) announced fraud charges against an Atlanta-based investment advisory firm and two executives accused of selling unsuitable investments to pension funds for the city’s police and firefighters, transit workers and other employees. The SEC’s Enforcement Division alleges that Gray Financial Group, its founder and president Laurence O. Gray, and its co-CEO Robert C. Hubbard IV breached their fiduciary duty by steering these public pension fund clients to invest in an alternative investment fund offered by the firm, despite knowing the investments did not comply with state law.Read more >
From the Magazine
Should Your Plan Offer a Retirement Income Product?
Income is the endgame of a 401(k) plan, and retirement income products are one way to ensure a steady stream of funds during a former employee’s retirement phase. Still, many plan sponsors have been leery of these offerings.Read more >
More than Half of DC Plans Offer Systematic Withdrawals
Many sponsors are encouraging pre-retirees to leave their account in the plan when they retire, making it easier for them to access money in retirement when they need it—and offering sponsors the benefits that follow from increased plan assets. For a plan to offer partial or systematic withdrawals, such options must be allowed for in the plan document.Read more >
Small Talk

ON THIS DATE: In 1802, President George Washington’s widow and the nation’s first First Lady, Martha Dandridge Custis Washington, died at her Mt. Vernon home. In 1841, Henry Kennedy received a patent for the first reclining chair. In 1843, a massive wagon train, made up of 1,000 settlers and 1,000 head of cattle, set off down the Oregon Trail from Independence, Missouri. It was known as the “Great Emigration.” In 1900, the Associated Press was incorporated as a non-profit news cooperative in New York. In 1906, the Wright brothers received a patent for their flying machine. In 1967, “Mister Rogers’ Neighborhood” premiered on PBS. In 1992, Johnny Carson hosted NBC’s “Tonight Show” for the last time. He had been host for 30 years. In 2002, in Birmingham, Alabama, a jury convicted former Ku Klux Klansman Bobby Frank Cherry of murder in the 1963 church bombing that killed four girls.

 

And now it’s time for FRIDAY FILES!

How to prevent running-shoe blisters, or ‘what the extra hole in your sneakers is for.’Read more >
An excessive popcorn popper.Read more >

In Pittsburgh, Pennsylvania, incumbent Councilwoman Barbara Daly Danko defeated her opponent, Caroline Mitchell, 5,575 to 4,015, for a seat on the Allegheny County Council. However, Daly Danko died from cancer May 6. “It was a sympathy vote for Daly Danko,” said Nancy Mills, chair of the Allegheny County Democratic Committee, according to Reuters. Jared Barker, the county council’s chief clerk and director of legislative services, said the council is expected to appoint someone in the next month to fill Daly Danko’s seat until November, when voters will pick someone to fill the remainder of her term.

In Sarasota, Florida, a woman awoke one morning to find a strange man asleep on the couch in her living room. She asked what he was doing there and threatened to call police. The man apologized and left. According to the Associated Press, the woman then noticed her wallet, driver’s license, credit and debit cards and some checks were missing from a table in the living room. She called police, who were able to arrest the man a short time later.

Remember phone booths? This will make you feel old.Read more >

In Camas, Washington, police were called to a lake when someone saw an SUV cruising around with a large tiger on its roof. When an officer arrived, he found the tiger was stuffed. The driver said he saw another car dump some trash and the tiger and thought it would be a fun joke to put it on the roof of his car. According to the Associated Press, the driver said he and the officer traded jokes and photos and the officer left.

In Levittown, Pennsylvania, a man and his wife were holding a Sweet 16 birthday party for his stepdaughter with about 40 guests. He said the party was ruined when apparent human waste fell from the sky. “Out of nowhere, from the sky, comes a bunch of fe.ces, lands on her,” the man told WTXF-TV. A canopy was the main target of the dump, but it landed on the birthday girl and some guests. The birthday girl’s sister used a smartphone app to discover there were three airplanes in the sky near the party at the time of the incident, according to UPI. The Federal Aviation Administration said the incident is being investigated.

Have a great weekend everyone! NewDash is taking a break for Memorial Day, but it will be back in your inbox Tuesday.
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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