Newsdash Insight on Plan Design & Investment Strategy from PLANSPONSOR
October 7th, 2015
The 2016 PLANSPONSOR Retirement Plan Adviser of the Year Awards nomination window has been extended. If you know a superb retirement plan adviser you think is worthy of the award, please nominate him or her this week.Read more >
We are now accepting nominations for the 2016 PLANSPONSOR Plan Sponsor of the Year awards. You can nominate a plan, or yourself, here.Read more >
Benefits & Administration
The Evolution of DC Plans Since 2005
An annual research report from NEPC, the large national pension consultant, celebrates its 10th edition this year by looking back at a decade of changes in the defined contribution (DC) retirement plan arena. The world was a completely different place in 2005, not only for retirement plans. Internet users were just being introduced to YouTube, for example, and the housing and equities markets still had a lot of ground to gain before 2008 and 2009. Ross Bremen, an NEPC partner who pilots the DC plan research effort each year, tells PLANSPONSOR the report delves into “all aspects of DC plan evaluation,” and shows clearly that plans and participants are generally in better shape today than a decade ago.Read more >
Employers Plan to Cut Back on Benefits Amid Recession Fears
Deals and People
Franklin to Add Retirement AUM With Putnam Acquisition
PPG Agrees to $309M Pension Risk Transfer Deal
The funded status of the typical U.S. corporate pension plan slipped again in September for the third consecutive month, dropping 2.4 percentage points, to 81.8%, according to BNY Mellon. The previous month’s low was 84.2%. Public plans, foundations and endowments also failed to meet targets due to declining asset values.Read more >
Employer Health Costs Lower, But Still Above Inflation
Employers expect a 4.1% rate of increase in the cost of employer-sponsored health care benefits in 2015—the lowest in 15 years but still well above inflation, according to an annual survey by Towers Watson and the National Business Group on Health (NBGH). The survey of 487 large U.S. employers also found that while employers remain concerned about the cost and effectiveness of their programs, they are more committed to providing some form of health care coverage to employees over the next 10 years than they have been in recent years. In addition, four out of five employers now identify changes to health and pharmacy plan designs as their most important strategic priority.Read more >
Employees Are Stressed Out and Stretched Thin
John Hancock Retirement Plan Services started its annual Financial Stress Study a year ago because the company “wanted to know what prevents people from saving for retirement,” said Patrick Murphy, president of John Hancock Retirement Plan Services, speaking at the PLANADVISER National Conference in Orlando, Florida. “Finance is the No. 1 cause of stress, and while there are competing priorities, retirement planning remains a top concern,” Murphy said. He discussed what plan sponsors can do to help.Read more >
More than half (53%) of employees surveyed by LIMRA said they spend less than one hour reviewing benefits information during their company’s open enrollment period. When they make a decision, it is usually to keep everything the same as last year. Only 36% of employees made changes to any of their benefit selections in the past year. Employees make benefit changes for a variety of reasons, the surveyed showed.Read more >
Products, Deals & People
Mercer has produced an “excise tax survival kit,” a series of blog posts written by Mercer consultants with a broad range of insights focusing on strategies to avoid the Patient Protection and Affordable Care Act (ACA) excise tax on high-cost health plans, and how the excise tax may affect other human resource (HR) and business objectives.Read more >
Is a Big Shift to Managed Accounts Likely?
It was only about a decade ago that Stadion Money Management, which bills itself as a defensively oriented money manager committed to using exchange-traded funds (ETFs), first started to offer a target-date fund (TDF) series to institutional clients, says Tim McCabe, senior vice president and national retirement sales director. “And, full disclosure, we are still committed to our TDF product lines and the opportunities that will continue on that side of the business, but we are very excited to announce a new push into managed accounts,” McCabe tells PLANSPONSOR. “TDFs have been a great first step for everyone, getting people into the ballpark post-PPA [Pension Protection Act] on where they should be with asset allocation, but we can do better.”Read more >
To gain insight into the best practices driving the most successful workplace wellness programs across the country, national nonprofit Transamerica Center for Health Studies (TCHS) partnered with the Institute for Health and Productivity Studies (IHPS) at the Johns Hopkins Bloomberg School of Public Health to release an evidence-based, straightforward workplace health promotion guide for employers.Read more >
Market Mirror

A rally in energy stocks wasn’t enough to lift the broader market, leaving indexes mostly lower at the closing bell, according to the Associated Press. The Dow finished up 13.76 points (0.08%) at 16,790.19, but the NASDAQ decreased 32.90 points (0.69%) to 4,748.36, and the S&P 500 was down 7.13 points (0.36%) at 1,979.92. The Russell 2000 lost 7.94 points (0.70%) to finish at 1,133.69, and the Wilshire 5000 closed 84.09 points (0.40%) lower at 20,763.12.


On the NYSE, 3.2 billion shares traded, with a slight lead for advancers. On the NASDAQ, 2.7 billion shares changed hands, with 1.3 declining issues for every advancing issue.


The price of the 10-year Treasury note was up 6/32, decreasing its yield to 2.038%. The price of the 30-year Treasury bond increased 15/32, bringing its yield down to 2.877%.

Ask the Experts
Ask the Experts – Allowing In-Service MRDs
“We are a private university that sponsors two plans, a 401(a) defined contribution (DC) plan for employer contributions and a 403(b) plan for employee contributions. We permit in-service withdrawals from the 403(b), but not the 401(a). However, several of our long-service professors have contacted us inquiring about the possibility of amending our 401(a) plan to permit minimum required distributions (MRDs) from the 401(a) plan while still employed. These professors are older than age 70.5 and have large retirement plan accumulations; their rationale is that, if they commence their MRDs now, rather than waiting until retirement, the annual MRD will be smaller, since it is based on life expectancy. Can we amend our 401(a) plan to permit in-service MRDs at age 70.5?”Read more >
Small Talk
A survey suggests people tend to choose dogs that act like them. For example, according to the “Natural Balance Canine Personality Study,” a survey of 1,015 U.S. dog parents conducted by Natural Balance Pet Foods in conjunction with Learndipity Data Insights, two-thirds (66%) of extroverted people have extroverted dogs. The survey revealed people have a strong emotional connection to their dogs as well.Read more >
ON THIS DATE:  In 1765, nine American colonies sent a total of 28 delegates to New York City for the Stamp Act Congress. The delegates adopted the “Declaration of Rights and Grievances.” In 1868, Cornell University was inaugurated in Ithaca, New York. In 1913, for the first time, Henry Ford’s entire Highland Park automobile factory was run on a continuously moving assembly line when the chassis was added to the process. In 1949, the German Democratic Republic (East Germany) was formed. In 1956, a U.S. House subcommittee began investigations of allegedly rigged TV quiz shows. In 1968, the Motion Picture Association of America adopted the film-rating system that ranged from “G” to “X.” In 2001, Barry Bonds (San Francisco Giants) hit his 73rd home run of the season and set a new major league record. In 2001, the U.S. and Great Britain began airstrikes in Afghanistan in response to that state’s support of terrorism and Osama bin Laden. The act was the first military action taken in response to the terrorist attacks on the U.S. on September 11, 2001. In 2003, in California, Arnold Schwarzenegger was elected governor in the recall election of Governor Gray Davis. In 2003, Randy Quaid received a star on the Hollywood Walk of Fame. In 2004, Billy Bob Thornton got a star on the Hollywood Walk of Fame.
WEDNESDAY WISDOM: “The best measure of a man’s honesty isn’t his income tax return. It’s the zero adjust on his bathroom scale.” —Arthur C. Clarke, science fiction writer
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Copyright © Asset International, Inc., 2015.

All rights reserved.  No reproduction without prior authorization.

Editorial: Alison Cooke Mintzer


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