Newsdash Insight on Plan Design & Investment Strategy from PLANSPONSOR
October 23rd, 2015
Benefits & Administration
Numerous Factors Drive Down Americans’ Retirement Goals
Saving to live comfortably in retirement is their most important financial priority, Americans say, after saving money in general—yet most (71%) are concerned they won’t be able to reach that goal, according to the latest BlackRock Global Investor Pulse survey. The reality is that Americans of all ages face a considerable shortfall in terms of the income they want in retirement compared with the income their savings can actually generate.Read more >
K–12 403(b) participants who used an adviser had a 34% higher median balance in their accounts than those who had the option to use an adviser but did not do so, according to a study of more than 1,000 respondents by AXA US. The study found advisers bring both emotional and financial value to plan participants.Read more >
2022 Recordkeeping Survey
TRIVIAL PURSUITS: Meaning and Origin of the Idiom “Watershed Moment?”
TRIVIAL PURSUITS: Which are the most northern, southern, eastern and western U.S. States?
TRIVIAL PURSUITS: From Where Did the Phrase ‘Be There With Bells On’ Originate
TRIVIAL PURSUITS: How Many States Are in More Than One Time Zone?
401(k)s May Result in More Successful Retirement than DBs
Focusing on employees who are eligible for participation in a retirement plan for at least 30 years, the Employee Benefit Research Institute (EBRI) found that a final-average defined benefit (DB) plan with an accrual rate of 1.5% is more likely to provide “successful” outcomes for lower-income workers when the employer-provided retirement benefits are added to the expected Social Security benefits. However, as income increases, a voluntary-enrollment 401(k) plan has a higher probability of producing a successful outcome than this type of defined benefit plan.Read more >
Health Plan Dependent Verification Saves CalPERS Millions
The California Public Employees’ Retirement System (CalPERS) has completed its Dependent Eligibility Verification (DEV) project, and it will achieve savings and cost avoidance close to $122 million. Citing data as of September 1, CalPERS staff reported to the Board of Administration’s Pension and Health Benefits Committee that the project resulted in more than 18,000 ineligible dependents being removed from employer-sponsored health care.Read more >
Products, Deals and People
Buck Consultants at Xerox notes that employees now want their work experience to mirror personal device use, but many employers don’t have the budget to put that kind of technology in place, so it has introduced Xerox Life Connect Solution, a human resources portal designed to improve employee engagement and access to workplace health, wealth and career programs. For retirement benefits, Scot Marcotte, leader of client technology in the Engagement practice at Buck Consultants at Xerox, tells PLANSPONSOR, “Life Connect brings asset data together for a user to see their full retirement plan picture.”Read more >
Economic Events

Existing-home sales rebounded strongly in September following August’s decline and have now increased year-over-year for 12 consecutive months, according to the National Association of Realtors. All four major regions experienced sales gains in September. Total existing–home sales, which are completed transactions that include single-family homes, townhomes, condominiums and co–ops, increased 4.7% to a seasonally adjusted annual rate of 5.55 million in September from a slightly downwardly revised 5.30 million in August, and are now 8.8% above a year ago (5.10 million).

The average interest rate for a 30-year fixed-rate mortgage is 3.79%, down from 3.82% one week ago, according to Freddie Mac. The average interest rate for a 15-year fixed-rate mortgage is 2.98%, down from 3.03%.

In the week ending October 17, the advance figure for seasonally adjusted initial claims for unemployment insurance was 259,000, an increase of 3,000 from the previous week’s revised level, the Labor Department reported. The four-week moving average was 263,250, a decrease of 2,000 from the previous week’s revised average. This is the lowest level for this average since December 15, 1973, when it was 256,750.

Market Mirror

Strong earnings reports led major U.S. stock indices higher Thursday. The Dow climbed 320.55 points (1.87%) to 17,489.16, the NASDAQ closed 79.93 points (1.65%) higher at 4,920.05, and the S&P 500 increased 33.57 points (1.66%) to 2,052.51. The Russell 2000 was up 9.58 points (0.84%) at 1,154.52, and the Wilshire 5000 gained 301.29 points (1.43%) to finish at 21,394.53.

On the NYSE, 3.2 billion shares traded, with a near 3 to1 lead for advancers. On the NASDAQ, 2.7 billion shares changed hands, with 1.7 advancing issues for every declining issue.

The price of the 10-year Treasury note was up 1/32, decreasing its yield to 2.023%. The price of the 30-year Treasury bond increased 3/32, bringing its yield down to 2.862%.

DOL Puts Stamp of Approval on ESG Investing
While introducing new guidance, Labor Secretary Thomas Perez told reporters environmental, social and governance (ESG)-based investing no longer has “the cooties” from an Employee Retirement Income Security Act (ERISA) perspective. The Department of Labor issued Interpretive Bulletin 2015-01, a piece of guidance Perez says will significantly expand the use of ESG investing principals among retirement plans.Read more >
Empower Cites Strong Benefits for Managed Account Users
Participants making use of a managed account product often see long-term portfolio returns in excess of those realized by participants who do not use managed accounts, according to new research from Empower Retirement. “The findings are very compelling and show that managed accounts make a lot of sense from both the investing and fiduciary/cost perspective,” Empower Retirement President Edmund Murphy III tells PLANSPONSOR.Read more >
As plan sponsors search for ways to find value and diversify asset classes in their defined contribution (DC) plans, many have considered offering alternative assets as an option. These assets provide the benefits of diversification and low correlation to traditional asset class performance. However, concerns about the scalability, liquidity and valuation needs of DC plans have inhibited their use as a viable investment option. In “Adding Alternatives to DC Plans,” Northern Trust explores the operational and plan structure options available to plan sponsors that wish to include alternative assets in their plans.Read more >
Small Talk

ON THIS DATE: In 1864, during the U.S. Civil War, Union forces led by Gen. Samuel R. Curtis defeated the Confederate forces in Missouri that were under Gen. Stirling Price. In 1929, in the U.S., the Dow Jones Industrial Average plunged, starting the stock-market crash that began the Great Depression. In 1946, the United Nations General Assembly convened in New York for the first time. In 1956, NBC broadcasted the first videotape recording. The tape of Jonathan Winters was seen coast to coast in the U.S. In 1958, Russian poet and novelist Boris Pasternak was awarded the Nobel Prize for literature. He was forced to refuse the honor due to negative Soviet reaction. Pasternak won the award for writing “Dr. Zhivago.” In 1973, U.S. President Richard M. Nixon agreed to turn over the subpoenaed tapes concerning the Watergate affair.


And now it’s time for FRIDAY FILES!

A bowling trick shot with a spin.Read more >
This costume can either serve as Cinderella in work clothes or Cinderella at the ball.Read more >

In Norway, the state of Texas has a big reputation. The phrase “helt Texas” is being used widely on social media and in the media to describe such things as sporting events, biologists’ findings and store deals. says Norwegians explain that “Texas” means mayhem and chaos, as in cowboys finding and shooting guns into the air. “Helt Texas” means “completely crazy.”

In Fayetteville, Arkansas, a toddler asked for a CVS-themed party for her fourth birthday. Her mom says the little girl sees the local CVS store as a wonderland of “snacks, drinks, toys, Chap-stick, and Band-aids,” so much so that she puts the drug store on par with Disney World in terms of dream locations, according to UPI. When CVS headquarters heard about this, they sent snacks, party supplies and party favors, such as CVS-brand water bottles. The local CVS flashed a “Happy Birthday” on its sign out front.

Estately Home Search used 11 years of Google Trends data to see what costumes users in each state search for more than users in any other state.Read more >

In Conyers, Georgia, police were called to the scene of an accident at a Kroger grocery store. There they found a disheveled man in a motorized wheelchair backing into the building and over plants. The wheelchair had been hit by an SUV. The man in the wheelchair told police he had taken Val.ium, an anti-pressant and a pint of alco.hol. He was cited for DU.I. According to the Atlanta Journal-Constitution, Georgia law says it’s illegal to operate “any moving vehicle” while under the influence of alc.ohol or drugs.

In Buffalo, New York, a woman who turned 100-years-old in August continues to work 11 hours a day, six days a week at a laundromat. She tells WGRZ-TV that she got her first job at 15 during the Great Depression and has been working ever since. She told the FOX news station she likes being out and working because it “gives her something to do.” She says too many people retire too soon. Her advice to her peers: “Get out and do some work.”

In Shepton Mallet, Somerset, England, a Neighborhood Watch co-ordinator left her house to attend a Neighborhood Watch meeting at a local fire station. She returned home to find police there. Ironically, while she had been at the Neighborhood Watch meeting, a burglar entered her house through the unlocked front door and stole money from her purse. The intruder was interrupted by the co-ordinator’s spouse, and fled the scene, according to the Shepton Mallet Journal.

Have a happy and safe weekend, everyone!
Share the good news with a friend! Pass the Dash along – and tell your friends/associates they can sign up for their own copy.Read more >

Editorial: Alison Cooke Mintzer


Subscribe to NEWSDash, click here .

To unsubscribe, click here.

BrightScope / CIO / FWW / Investor Economics / LiquidMetrix / Market Metrics / Matrix Solutions / PLANADVISER / Plan For Life / PLANSPONSOR / Simfund