Newsdash Insight on Plan Design & Investment Strategy from PLANSPONSOR
May 31st, 2016
Benefits & Administration
Employees Say They Cannot Afford to Save for Retirement
A survey found not being able to afford to contribute is the top reason employees say they do not participate in their employer-sponsored plans, and many are not confident about managing investments.Read more >
Employers Taking More Efforts to Cut Health Benefits Costs
Employers are turning to consumer-directed health care and are tightening spousal rules as health benefit cost containment strategies, according to Conrad Siegel Actuaries’ annual Medical and Prescription Drug survey.Read more >
MOST READ ARTICLES
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2021 Plan Sponsor of the Year
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How to Effectively Measure Retirement Plan Success
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2020 Recordkeeping Survey
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A Checklist for Retirement Plan Committees
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Settlement Reached in Insperity 401(k) Excessive Fee, Self-Dealing Suit
Products, Deals and People
Retirement Industry People Moves
Northern Trust Asset Management adds Public Funds and Taft-Hartley leader; Vanguard hires head of finance division.Read more >
Economic Events
THE ECONOMIC WEEK AHEAD: Today, the Conference Board will release its Consumer Confidence Index for May. Tomorrow, the Census Bureau will report about construction spending for April. Thursday, the Labor Department will issue its initial claims report. Friday, the Bureau of Labor Statistics will reveal the unemployment rate for May.
Market Mirror

Friday, the Dow was up 44.93 points (0.25%) at 17,873.22, the NASDAQ gained 31.74 points (0.65%) to finish at 4,933.50, and the S&P 500 increased 8/11 points (0.39%) to 2,098.21. The Russell 2000 climbed 10.69 points (0.94%) to 1,150.44, and the Wilshire 5000 closed 98.80 points (0.46%) higher at 21,701.47.

On the NYSE, 3.1 billion shares changed hands, and on the NASDAQ, 2.7 billion shares traded, with advancing issues outnumbering declining issues 2 to1 on both exchanges.

The price of the 10-year Treasury note decreased 6/32, bringing its yield up to 1.851%. The price of the 30-year Treasury bond was down 4/32, increasing its yield to 2.648%.
Compliance
Court Allows Participants to Seek Plan Reformation Relief
Citing the Supreme Court decision in Amara v. CIGNA Corp., the 9th U.S. Circuit Court of Appeals has moved forward equitable relief claims of plan participants who say they were misled about the pension benefits they would receive. While a district court found the plan participants’ benefit claims and equitable relief claims under the Employee Retirement Income Security Act (ERISA) duplicative, the appellate court noted that under Amara, if the participants cannot get relief with their benefit claims under U.S. Code Section 1132(a)(1)(B), they can seek an equitable remedy for breach of fiduciary duty to disclose under U.S. Code Section 1132(a)(3).Read more >
From the Magazine
Strategic Insight’s Quarterly TDF Analysis
The first quarter of 2016 saw continued expansion of the target date-fund (TDF) market as mutual funds in these strategies built upon a solid 2015. With net inflows close to $19 billion for the quarter, target-date funds are on pace to meet or exceed marks set last year, according to Strategic Insight, an Asset International company.Read more >
Small Talk
ON THIS DATE: In 1859, in London, Big Ben went into operation. In 1870, E.J. DeSemdt patented asphalt. In 1879, New York’s Madison Square Garden opened. In 1884, Dr. John Harvey Kellogg patented “flaked cereal.” In 1907, the first taxis in the United States arrived in New York City. In 1909, the National Association for the Advancement of Colored People (NAACP) held its first conference. In 1913, the 17th Amendment went into effect. It provided for popular election of U.S. senators. In 1941, the first issue of “Parade: The Weekly Picture Newspaper” went on sale. In 2003, in North Carolina, Eric Robert Rudolph was captured. He had been on the FBI’s 10 Most Wanted list for five years for several bombings including the 1996 Olympic bombing.
SURVEY SAYS RESPONSES: Last week, I asked NewsDash readers, “Have you taken a loan, hardship or other in-service distribution, or have you cashed out a plan upon a job change, and do you regret having done so?” Asked which, if any, premature distributions of retirement savings they have taken, 40.8% have taken a loan, and 24% said they have cashed out their retirement plan after a job change. Four percent each reported taking a hardship distribution or other in-service distribution. Two percent said “all of the above,” and 36.7% said “none of the above.” Nearly 7% said they regret taking a loan from their retirement plan. No one reported regretting taking a hardship distribution. Nearly 7% regret taking an in-service withdrawal. More than 13% regret cashing out their retirement plan upon job change. In comments about taking premature distributions from retirement savings, sentiments were mixed. Some say taking retirement savings prematurely is just a bad idea, but others feel it helps with emergencies and makes sense over increasing debt. I myself have taken a loan once, and like a couple of readers said, I have no regrets because the interest I paid myself was more than what the market was producing. I do, however, regret cashing out my retirement plan after I left my first employer, so Editor’s Choice goes to the reader who said, “Cash outs at job change should be eliminated. Either leave it where it is, or do a direct rollover.” A big thank you to all who participated in the survey!Read more >
Share the good news with a friend! Pass the NewsDash along—and tell your friends/associates they can sign up for their own copy.Read more >

Editorial: Alison Cooke Mintzer alison.mintzer@strategic-i.com

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