Newsdash Insight on Plan Design & Investment Strategy from PLANSPONSOR
November 29th, 2017
Benefits & Administration
Many People Have Withdrawn From the Markets Following ’08
Although 40% of people say the financial crisis of 2008 has had no lasting impact on their life, 42% say they now avoid the market and 46% have adjusted their spending and savings habits, Hartford Funds found in a survey. Millennials also have the least faith in the markets, with 48% avoiding the market altogether. Read more >
Retirees Spending Only About 1% of Assets Each Year
Research conducted by the BlackRock Retirement Institute and the Employee Benefit Research Institute (EBRI) found that after nearly two decades of being retired, the average retiree still has 80% of their nest egg intact. The researchers say this finding challenges long-held fears about retirees spending down their savings too fast. They also discovered that more than one-third of retirees continue to grow their assets late into life, “leaving considerable potential consumption on the table.” Read more >
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Working Longer Could Boost Retirement Security
Remaining in the workforce for as long as feasible benefits workers in three main ways, the Center for Retirement Research at Boston College maintains in a new issue brief. However, the research finds workers with a lower socioeconomic status have a harder time staying in the workforce. The issue brief concluded that policymakers should find ways to help people remain in the workforce longer other than lowering their health insurance costs. Read more >
Products, Deals and People
MassMutual Introduces Mobile App to Gauge Retirement Readiness
The app is a mobile version of MassMutual’s RetireSMART Ready tool, which provides a snapshot of a saver’s retirement readiness at a specific age. Read more >
Sponsored message from Natixis
How to Target More Than a Retirement Date The Natixis Sustainable Future Funds, the industry’s first ESG-driven target date funds, combine sophisticated methodology with sustainable ideology. Now, investors can invest in the future with purpose. 1880753.1.1 Read more >
Ask the Experts
Problem With Compensation Definition in 403(b) Prototype Plan
“We use a recordkeeper-provided prototype plan document for our 403(b) plan, and the base plan document only allows for a modified W-2 definition of compensation, that adds back deferrals to 403(b), 457(b) etc. plans, but otherwise includes all other forms of W-2 comp, and does not specifically exclude employee benefit payments. We maintain a 457(b) plan, and, of course, distributions from that plan are W-2 income. The base plan document does not exclude such distributions from compensation. Our adoption agreement does permit us to modify the base plan document definition of compensation, but it currently does not exclude 457(b) distributions. Should they be excluded?” Read more >
Economic Events

Retail inventories for October, adjusted for seasonal variations but not for price changes, were estimated at an end-of-month level of $618.0 billion, down 0.1% from September, and up 2.6% from October 2016, the Census Bureau announced. The August to September percentage change was unrevised at down 0.9%.

Wholesale inventories for October, adjusted for seasonal variations but not for price changes, were estimated at an end-of-month level of $605.7 billion, down 0.4% from September, and up 4.0% from October 2016. The August to September percentage change was revised from up 0.3% to up 0.1%.

Market Mirror

Tuesday, the Dow gained 255.93 points (1.09%) to finish at 23,836.71, the NASDAQ closed 33.84 points (0.49%) higher at 6,912.36, and the S&P 500 increased 25.62 points (0.98%) to 2,627.04. The Russell 2000 was up 23.12 points (1.53%) at 1,536.43, and the Wilshire 5000 climbed 263.54 points (0.97%) to 27,296.22.

 

The price of the 10-year Treasury note was up 1/32, decreasing its yield to 2.328%. The price of the 30-year Treasury bond increased 8/32, bringing its yield down to 2.755%.

Compliance
Citigroup Proprietary Fund Suit Gets Class Certification
Before certifying a class in the litigation, a federal judge determined that the named plaintiffs need not have invested in all funds challenged in the suit in order to represent 401(k) participants that invested in the funds. Read more >
Appeals Court Sides with UPMC in Top-Hat Plan Dispute
The 3rd U.S. Circuit Court of Appeals has ruled in support of the district court and defendants in a case testing the differences in anti-cutback vesting regulations applying to “top-hat” retirement plans versus traditional defined contribution (DC) or defined benefit (DB) plans. Read more >
Social Security Reduces Maximum Taxable Wage for 2018
The Internal Revenue Service uses the Social Security Administration’s taxable maximum to determine the taxable wage base for permitted disparity in defined contribution (DC) plan contributions. Read more >
Small Talk
Forty percent of workers have called in sick in the last 12 months when they weren’t, compared to 35% in 2016 and 38% in 2015, according to new CareerBuilder data. Workers need to be careful with their excuses since more than one-third of employers (38%) have checked up on someone who called in sick to make sure he or she was actually sick, and 26% have fired an employee for calling in sick with a fake excuse. Employers report the most dubious excuses workers have given for taking an unscheduled day off. Read more >

ON THIS DATE: In 1890, Navy defeated Army by a score of 24-0 in the first Army-Navy football game. In 1892, a patent was issued to Almon Brown Strowger for the rotary dial. In 1929, the first airplane flight over the South Pole was made by U.S. Navy Lt. Comdr. Richard E. Byrd. In 1963, U.S. President Lyndon Johnson named a commission headed by Earl Warren to investigate the assassination of President John F. Kennedy. In 1967, U.S. Secretary of Defense Robert S. McNamara announced that he was leaving the Johnson administration to become president of the World Bank. In 1975, Bill Gates adopted the name Microsoft for the company he and Paul Allen had formed to write the BASIC computer language for the Altair. In 1986, actor Cary Grant died at the age of 82. In 2004, Godzilla received a star on the Hollywood Walk of Fame.

 

 

WEDNESDAY WISDOM: “If opportunity doesn’t knock, build a door.”—Milton Berle, comedian and actor

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

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