Newsdash Insight on Plan Design & Investment Strategy from PLANSPONSOR
November 17th, 2014
Benefits & Administration
Letitia James, New York City’s public advocate, is readying legislation that would create a board tasked with studying and establishing a centrally pooled pension fund for the city’s private sector. “Too many people have too little savings, and no access to quality retirement planning,” James said in a recent statement. Citing figures from a New School study, James said the percentage of New York City workers participating in a workplace-based retirement plan dropped by 17% between 2001 and 2011. The data also found just 12% of New Yorkers in that same time frame had access to a defined benefit (DB) plan.Read more >
Retirement Savings Delays Add Up
Postponing retirement plan salary deferrals by five to 10 years can reduce total retirement income by nearly 25%, according to research from the Insured Retirement Institute (IRI). A worker contributing 10% of income annually to a retirement plan beginning at age 35, rather than age 30, will receive 11% less in annuitized retirement income. Over the course of a 25-year retirement, the reduced income adds up to $62,000.Read more >
Products, Deals & People
The Legg Mason BW Dynamic Large Cap Value Fund utilizes a dynamic shifting tool and a proprietary quantitative strategy. Available in institutional shares, the fund’s broad objective is to provide long-term capital appreciation by quantitatively investing in U.S. equities.Read more >
White Paper Tackles Annuity Purchase Confusion
Annuities can help manage defined benefit (DB) plan risks, but retirement plan sponsors should contemplate a few common misperceptions, The Principal Financial says. Pension risk management is an ongoing process, and in an ever-changing environment, it can be a challenge for plan sponsors to manage the risks of their DB plans. The Principal Financial Group aims to clear up some of the confusion around annuity purchases and help plan sponsors make informed decisions through discussion of common scenarios, case studies, modeling and examples in a new paper, “What Can We Learn from Six Common Annuity Purchase Misconceptions?”Read more >
Sponsored message from MetLife
De-Risking Actions for Defined Benefit Pension Plans
There are several actions plan sponsors can take to de-risk their plans. View our short video to see how these actions may help you.Read more >
Economic Events
The U.S. Census Bureau announced that the combined value of distributive trade sales and manufacturers’ shipments for September, adjusted for seasonal and trading-day differences but not for price changes, was estimated at $1,352.5 billion, virtually unchanged from August 2014, but up 4.1% from September 2013. Manufacturers’ and trade inventories, adjusted for seasonal variations but not for price changes, were estimated at an end-of-month level of $1,756.1 billion, up 0.3% from August and up 5.3% from September 2013. Advance estimates of U.S. retail and food services sales for October, adjusted for seasonal variation and holiday and trading-day differences, but not for price changes, were $444.5 billion, an increase of 0.3% from the previous month, and 4.1% above October 2013. THE ECONOMIC WEEK AHEAD: Tomorrow, we’ll learn the producer price index (PPI) for October from the Bureau of Labor Statistics. Wednesday, the Census Bureau will report about housing starts for October. Thursday, the Labor Department will issue its initial claims report, we’ll learn the consumer price index for October from the Bureau of Labor Statistics, and the National Association of Realtors will report about existing home sales for October.
Market Mirror
Friday, the Dow slipped 18.05 points (0.10%) to 17,634.74, the NASDAQ ticked up 8.40 points (0.18%) to 4,688.54, and the S&P 500 increased by 0.49 (0.02%) to 2,039.82. The Russell decreased by 1.61 (0.14%) to 1,173.81, and the Wilshire 5000 closed 11.75 points (0.05%) higher at 21,467.77. On the NYSE, 3.2 billion shares changed hands, with a slight lead for advancers. On the NASDAQ, 2.7 billion shares traded, with a slight lead for decliners. The yields for the 10-year Treasury note and 30-year Treasury bond were 2.320% and 3.051%, respectively. WEEK’S WORTH: For the week ending November 14, the Dow was up 0.35%, the NASDAQ climbed 1.21%, and the S&P 500 closed 0.39% higher. The Russell 2000 ticked up 0.04%, and the Wilshire 5000 gained 0.40%.
Form 5500 Precision Is All in the Details
Sometimes, Form 5500 errors can come down to something as simple as a single number. Here are some goofs for retirement plan sponsors to keep an eye out for. “It’s a good idea to review,” Mike Webb, vice president of Cammack Retirement Group, tells PLANSPONSOR. The Form 5500 is complicated, and requires a full audit, which is also complicated. Webb recommends plans work with a trusted adviser to review the document before submitting it. Sometimes the plan sponsor picks up an irregularity; sometimes the auditor does. Webb says it is possible for either to find a problem area, and mistakes are common. “Fifty percent of the time, I find a mistake,” he says.Read more >
Investors Continue Search for Fixed-Income Yield
Finding yield remains a top consideration for investors choosing fixed-income investments, according to a new survey from Franklin Templeton Investments. While the search for yield is top of mind for most U.S. fixed-income investors, Franklin Templeton’s research shows three in four (74%) are concerned about how rising rates will impact their portfolio in the months or years ahead. The findings are from “Franklin Templeton Fixed Income Pulse.”Read more >
More than half of financial advisers (61%) claim to have seen an increase in the number of people aged 55+ seeking advice, since the pension reforms were announced in the March Budget, according to Aviva.Read more >
Small Talk
ON THIS DATE: In 1777, Congress submitted the Articles of Confederation to the states for ratification. In 1869, the Suez Canal, connecting the Mediterranean and the Red seas, was inaugurated in an elaborate ceremony attended by French Empress Eugénie, wife of Napoleon III. In 1962, Washington’s Dulles International Airport was dedicated by U.S. President Kennedy. In 2003, the actor and former bodybuilder Arnold Schwarzenegger was sworn in as the 38th governor of California.
SURVEY SAYS: Workplace Holiday Practices
Last week, I asked NewsDash readers about holiday practices at their workplace. When asked what time off their company offers for Thanksgiving, 25.9% said Thanksgiving Day only, 51.7% replied Thanksgiving Day and the Friday after and 1.7% chose “none.” Thanksgiving meals are hosted by 10.3% of responding readers’ companies. For Christmas, 1.7% of respondents said their companies offer no time off, 24.1% get Christmas Day off only and 12.1% get Christmas Day and the day after. Nearly 21% are offered time off  Christmas Eve and Christmas Day, 5.2% get Christmas Eve, Christmas and the day after, and 3.4% of lucky readers are off the whole week of Christmas. More than 27% of respondents’ companies host a meal as a Christmas celebration, 10.3% host a party, and 19% host a meal and a party. More than 34% said there is a gift exchange among employees at their workplace for the holidays, and 32.8% said their companies give a gift or bonus to employees for the holidays? In verbatim responses, Editor’s Choice goes to the reader who said: “As part of our team building, we take a few hours the day before Thanksgiving to assist the homeless shelter in serving a Thanksgiving dinner and reflect on how truly blessed we are. It is more worthy to give and help the less fortunate than to receive or give a gift that you may never be used.” A big thank you to all who participated in our survey!Read more >
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News from   Copyright © Asset International, Inc., 2014. All rights reserved.  No reproduction without prior authorization.
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Editorial: Alison Cooke Mintzer


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