| | Benefit Briefs | | New DC Thinking Based on DB Best Practices | | Defined contribution (DC) plan sponsors are
already adopting defined benefit (DB) best practices in plan design, but plans
could benefit from more DB-like investing and communication. Improvements that
can be made in the defined contribution system include higher expected returns
on investment for the same risk, Robert C. Merton told attendees of the Plan
Sponsor Council of America (PSCA)’s 2014 National Conference. “We can’t dictate
this, but we need to make sure investments in DC plans are at least as
effective as investments in DB plans,” he said. “When choosing
investments, plan sponsors should use the lens of, ‘How will this produce
similar rates of return and risk as we enjoyed in DB plans?’”Read more > | | 2014 PLANSPONSOR National Conference Highlights | | The 2014 PLANSPONSOR National Conference (PSNC),
held in Chicago in June, was three jam-packed days of information-sharing via
speakers and panel discussions, all aimed at helping attendees set goals for
their retirement plan and their participants. Topics ran the gamut from plan
diversification to plan decumulation, investment committee governance and
outsourcing fiduciary status, not to mention possible new regulations to watch
for. While the conference focused on the challenges facing defined contribution
(DC) plan sponsors, we also included sessions on defined benefit (DB) plan
management and investing, health insurance concerns and nonqualified plan
innovations. Here are highlights from just a few of the thought-provoking
sessions.Read more > | | | Buyer's Market | | Another Private Health Exchange Introduced | | A new private exchange from Independence Blue
Cross offers coverage options for midsized and large employers. Beginning
October 1, employers in the Philadelphia five-county area with more than 100
employees will be able to use the exchange marketplace from Independence Blue
Cross. The private exchange will offer medical, pharmacy, dental and vision
coverage, all effective on or after January 1, 2015.Read more > | | | Industry Voices | | Industry Voices: Helping Employees Balance Benefits Spending | | Recently we sat down with Jillian, a new college
graduate just launching her career and planning on starting a family, who
wanted our team to assist her in establishing a budget. Jillian had the idea
that we would tell her to stop eating out, stop using her credit card, and
begin turning the lights off in every room of her house when she walked out the
door. Much to her surprise, we focused our initial efforts on reviewing the way
that Jillian was spending her hard earned dollars at work. In other words, we
wanted to take an in-depth look at the insurance, retirement and supplemental
benefit offerings available through her employer to help make sure she was
using her dollars wisely. As we explained to her, being a good steward of her
discretionary income is important, but we often find that employees tend to
waste money on the wrong benefits or on benefits they don’t even need.Read more > | | | Economic Events | | The Producer Price Index (PPI) for final demand
was unchanged in August, according to the Bureau of Labor Statistics. Final
demand prices advanced 0.1% in July and 0.4% in June. In August, a 0.3% rise in
prices for final demand services offset a 0.3% decrease in the index for final
demand goods. | | | Market Mirror | | Tuesday, the Dow gained 100.83 points
(0.59%) to finish at 17,131.97, the NASDAQ climbed 33.86 points (0.75%) to
4,552.76, and the S&P 500 closed 14.85 points (0.75%) higher at 1,998.98.
The Russell 2000 increased 4.45 points (0.39%) to 1,150.97, and the Wilshire
5000 was up 149.85 points (0.71%) at 21,128.77.
On the NYSE, 3.2 billion shares traded,
with advancing issues outnumbering declining issues by nearly 2 to 1. On the
NASDAQ, 2.8 billion shares changed hands, with a slight lead for advancers.
The price of the 10-year Treasury note was virtually
unchanged, with its yield at 2.591%. The price of the 30-year Treasury bond
fell 8/32, increasing its yield to 3.361%.
| | | Rules & Regulators | | Treasury Official Discusses Options for Improving DC Plans | | The U.S. retirement plan landscape has moved
from defined benefit (DB) to defined contribution (DC), and now to an undefined
contribution system, one Treasury official contends. Speaking to attendees of
the Plan Sponsor Council of America (PSCA)’s 2014 Annual Conference, Mark Iwry,
senior advisor to the Secretary of the Treasury, and deputy assistant secretary
of Retirement and Health Policy at the U.S. Treasury, explained that, in the
age of 401(k)s and 403(b)s, rather than straight profit-sharing plans, the
contribution is unknown. It is whatever the participant decides to put into the
plan, and the company match depends on that. “We need to restructure the retirement
system so that retirement income can be defined,” he said. “There are things
that can be done without the government passing more regulations.”Read more > | | | Financial Sense | | CalPERS Eliminates Hedge Fund Program | | As part of an ongoing effort to reduce
complexity and costs in its investment program, the California Public
Employees’ (CaIPERS), the largest public pension fund in the U.S., will
eliminate its hedge fund program. According to CaIPERS Interim Chief Investment
Officer (CIO), “Hedge funds are certainly a viable strategy for some, but at
the end of the day, when judged against their complexity, cost, and the lack of
ability to scale at CaIPERS’ size, the ARS [Absolute Return Strategies] program
[CaIPERS’ internal name for hedge funds] is no longer warranted.”Read more > | | | Sponsored message from Vanguard | Myths and misconceptions about indexing
In this research note, authors Christopher Philips and Josh Hirt of Vanguard Investment Strategy Group address many of indexing’s criticisms and provide historical evidence to suggest that indexing remains an appealing strategy across different asset classes and market environments.Read more > | | | Small Talk | | How Does Your State Rank in Driver Rudeness? | | What do Idaho, the nation’s capital and New York
State all have in common? The rudest
drivers in the country, according to a survey from Insure.com. Cutting in ahead
of the rest were Wyoming, Massachusetts, Delaware and Vermont (tied for sixth),
New Jersey, Nevada and Utah. Insure.com also rated “the biggest haters,”
counting how many other states got states riled on the road. The winner was
California, which hated not only the drivers from nearby states—Nevada,
Arizona, Oregon—but also, Colorado, Utah, Texas, Arkansas, New York
and Vermont.Read more > | | ON
THIS DATE: In
1787, the Constitution of the United
States of America was signed by 38 of 41 delegates present at the conclusion of
the Constitutional Convention in Philadelphia. In 1862, Confederate and Union troops in the Civil War clashed near
Maryland’s Antietam Creek in the bloodiest one-day battle in American history. In
1920, the American Professional
Football Association was formed in Canton, Ohio. It was the precursor to the
National Football League (NFL). In 1937,
at Mount Rushmore, Abraham Lincoln’s face was dedicated. In 1964,
“Bewitched” premiered on ABC-TV. In 1972, “M*A*S*H” premiered on
CBS-TV. In 1976, NASA publicly
unveiled its first space shuttle, the Enterprise, during a ceremony in
Palmdale, California. In 1983,
20-year-old Vanessa Williams became the first African American to win the Miss
America crown.
WEDNESDAY
WISDOM: “Knowledge
is power only if man knows what facts not to bother with.”—Robert Staughton Lynd, American sociologist and
professor at Columbia University
| | 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 > | | News from PLANSPONSOR.com
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