Newsdash Insight on Plan Design & Investment Strategy from PLANSPONSOR
May 31st, 2018
Benefits & Administration
Penn State Announces New Retirement Program Fee Practices
The plan to adopt a fee-leveling approach and rebates of revenue sharing to participants comes as many higher education institutions face lawsuits challenging their 403(b) plan fees. Read more >
Work for Fun in Retirement? Many Say They Will
Talking through the newly published 2018 Guide to Retirement with a small group of financial services trade journalists, Anne Lester, head of retirement solutions for J.P. Morgan Asset Management, highlighted the deep analytical work her team has done regarding the optimal shape of target-date fund (TDF) glide paths during investors’ retirement years. She also took time to talk about the broad demographic research her team conducts to better inform TDF product construction. In short, the firm sees clear evidence that the U.S. workforce is rapidly aging, and that this fact should inform providers’ and plan sponsors’ decisions about how they present retirement investing opportunities to individual participants. Lester also pointed out that older Americans are working later. “Asked about the major reasons they want to work beyond the traditional retirement age, Americans point to both wants and needs,” Lester explained. “The most common response is that people want to stay active and involved, or that they simply enjoy working. Some say they will try a new career, while about a fifth say they expect to need to work beyond this age to make ends meet.” Read more >
MOST READ ARTICLES
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IRS Announces 2019 HSA Contribution Limits
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4% Rule Not a Reliable Retirement Income Withdrawal Strategy for All People
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Lawsuit Argues MetLife Pension Calculations Use Outdated Mortality Table
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401(k) Plan Sponsors Enhancing Plan Design
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Duke University 403(b) Plan Lawsuits Reportedly Settled
Behavioral Economics Not Just Useful for Retirement Plan Nudges
As employers look to control health care costs, and keep their workers well, a relatively new area of interest has emerged—behavioral economics. Many employers are already implementing the theories of behavioral economics in their employee benefit plans and communications, and nearly two in five are interested in learning more about how to do so, according to the International Foundation of Employee Benefit Plans (IFEBP). Read more >
Financial Wellness Is a Process
Compared with new users, repeat users are 24% more apt to be on track for retirement and 21% more apt to have confidence in their investments, Financial Finesse research finds. The firm observes ways employers drive repeat usage of financial wellness programs. Read more >
Market Mirror

Wednesday, the Dow gained 306.33 points (1.26%) to finish at 24,667.78, the NASDAQ closed 65.86 points (0.89%) higher at 7,462.45, and the S&P 500 increased 34.15 points (1.27%) to 2,724.01. The Russell 2000 was up 24.34 points (1.50%) at 1,647.99, and the Wilshire 5000 climbed 356.98 points (1.27%) to 28,414.77.

 

The price of the 10-year Treasury note decreased 19/32, bringing its yield up to 2.846%. The price of the 30-year Treasury bond fell 31/32, increasing its yield to 3.019%.

Investing
Many TDFs Need to Be Adjusted for Risk
Target-date funds (TDFs) have been steadily growing in popularity, quadrupling as a portion of mutual fund assets in defined contribution (DC) plans in just over a decade, notes investment services provider SEI. However, the firm observes, many TDFs are riding the wave of the bull market and pursuing generic—meaning just stock and bond—investment strategies that are overall too risky. Jake Tshudy, director of DC investment strategies at SEI, recommends a more diversified portfolio within TDFs. He also says, “An actuarial valuation approach akin to a DB [defined benefit] plan is the best strategy to determine if a TDF series has the appropriate level of risk based on a plan’s demographics.” Read more >
Small Talk

ON THIS DATE: In 1859, in London, Big Ben went into operation. In 1884, Dr. John Harvey Kellogg patented “flaked cereal.” In 1907, the first taxis arrived in New York City. They were the first in the United States. 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 1955, the U.S. Supreme Court ordered that all states must end racial segregation “with all deliberate speed.” In 1977, the trans-Alaska oil pipeline was finished after three years of construction. 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: We recently covered a survey which found 15% of workers say they have argued with a coworker about office temperature. This week, I’d like to know, during the summer months, do you think your workplace temperature is too hot or too cold? Also, which listed options have you done concerning the office temperature in your workplace? You may respond to this survey by 6 p.m. Pacific time today. 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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