Newsdash Insight on Plan Design & Investment Strategy from PLANSPONSOR
September 25th, 2015
Benefits & Administration
After-Tax HSAs a Strategy for Avoiding Excise Tax
Health plan costs that may trigger the excise tax on high-cost plans under the Patient Protection and Affordable Care Act (ACA) do not just include the basic cost of coverage, noted Tracy Watts, Washington, D.C.-based U.S. leader for health care reform for Mercer. They include the cost of on-site clinics, as well as pre-tax contributions made to health reimbursement accounts (HRAs), flexible spending accounts (FSAs) and health savings accounts (HSAs). Speaking to attendees of a Mercer webcast, Watts shared that a recent survey by Mercer found, if employers made no changes to their plans, considering basic plan costs only, 31% will trigger the excise tax in 2018, and 51% will trigger it by 2022. “This is before you add other components,” she said. Most employers do not facilitate after-tax contributions to HSAs, but they should consider it as a potential strategy to avoid the ACA excise tax on high-cost health plans.Read more >
MOST READ ARTICLES
1
2021 Target-Date Fund Survey
2
The DOL Has Begun Retirement Plan Cybersecurity Audits
3
Rush of Litigation Against Retirement Plans Expected to Continue
4
2020 Recordkeeping Survey
5
TRIVIAL PURSUITS: What do the M’s stand for in M&Ms?
Participants Welcome More Contact with Plan Providers
Seventy-four percent of defined contribution (DC) retirement plan participants would welcome more information about financial products and services from their providers, according to Cogent Reports’ annual DC Participant Planscape. This jumps to 80% among Millennials and Gen Xers. In addition, participants said they wouldn’t mind if the providers contacted them directly, rather than through their employer.Read more >
Products, Deals & People
EDI Offers Advanced Equity Analytics
Exchange Data International (EDI) announced the expansion of its equity analytics data service for investment professionals. The service now enables clients to better identify the sources of risk and returns in their portfolios and project their volatility.Read more >
Buck Reveals Instant Pension Risk Monitor
The new Pension Risk Navigator from Buck Consultants provides an advanced approach to live pension risk monitoring, helping pension fund officials to better seize market opportunities and reduce uncompensated risk.Read more >
Economic Events

In the week ending September 19, the advance figure for seasonally adjusted initial claims for unemployment insurance was 267,000, an increase of 3,000 from the previous week’s unrevised level of 264,000, the Labor Department reported. The four-week moving average was 271,750, a decrease of 750 from the previous week’s unrevised average of 272,500. 

The average interest rate for a 30-year fixed-rate mortgage is 3.86%, down from 3.91% one week ago, according to Freddie Mac. The average interest rate for a 15-year fixed-rate mortgage is 3.08%, down from 3.11%.

Sales of new single-family houses in August were at a seasonally adjusted annual rate of 552,000, according to estimates released jointly by the U.S. Census Bureau and the Department of Housing and Urban Development. This is 5.7% above the revised July rate of 522,000 and 21.6% above the August 2014 estimate of 454,000.

New orders for manufactured durable goods in August decreased $4.8 billion or 2.0% to $236.3 billion, the U.S. Census Bureau announced. This decrease, down following two consecutive monthly increases, followed a 1.9% July increase. Excluding transportation, new orders decreased less than $0.1 billion, or were virtually unchanged. Excluding defense, new orders decreased $2.2 billion or 1.0%. Transportation equipment, also down following two consecutive monthly increases, led the decrease, $4.8 billion or 5.8% to $78.7 billion.

Market Mirror

U.S. stock indices closed lower Thursday as traders worry again about slowing global growth, according to the Associated Press. The Dow fell 78.57 points (0.48%) to 16,201.32, the NASDAQ lost 18.27 points (0.38%) to finish at 4,734.48, and the S&P 500 decreased 6.52 points (0.34%) to 1,932.24. The Russell 2000 was down 2.52 points (0.22%) at 1,137.53, and the Wilshire 5000 closed 75.28 points (0.37%) lower at 20,355.11.                        

On the NYSE, 3.2 billion shares changed hands, with 1.5 declining issues for every advancing issue. On the NASDAQ, 2.7 billion shares traded, with a 1.2 to 1 ratio of decliners to advancers.

The price of the 10-year Treasury note was up 8/32, decreasing its yield to 2.126%. The price of the 30-year Treasury bond increased 21/32, bringing its yield down to 2.915%.

From the Magazine
International Equity Drives ETF Inflows
Strong demand for exchange-traded funds (ETFs) continued uninterrupted in the second quarter of this year. U.S. domiciled ETFs, including exchange-traded notes (ETNs), attracted inflows of $44 billion in Q2, pushing the total for the first half of 2015 to $102 billion.Read more >
Small Talk

ON THIS DATE: In 1513, the Pacific Ocean was discovered by Spanish explorer Vasco Nunez de Balboa when he crossed the Isthmus of Panama. He named the body of water the South Sea. In 1789, the first U.S. Congress adopted 12 amendments to the Constitution. Ten of the amendments became the Bill of Rights. In 1978, Melissa Ludtke, a writer for “Sports Illustrated”, filed a suit in U.S. District Court. The result was that Major League Baseball could not bar female writers from the locker room after the game. In 1981, Sandra Day O’Connor became the first female justice of the U.S. Supreme Court when she was sworn in as the 102nd justice. In 1995, Ross Perot announced that he would form the Independence Party.

 

And now it’s time for FRIDAY FILES!

Here’s something you don’t see on the highway every day.Read more >
Some dogs just don’t know how to let it go.Read more >

In Manchester, New Hampshire, an owner of an apartment building called a tow truck to have an illegally parked car removed. After the car had been placed on the tow truck and lifted, the owner of the vehicle showed up. According to the Union Leader, to avoid having his car towed, the man set it on fire. The tow truck driver unhitched and dropped the vehicle, at which time the owner extinguished the car fire himself before fire and police personnel arrived. He was arrested for arson.

In Syracuse, Indiana, a woman and her 9-year-old son got in her car, and the woman started backing out of her driveway. When she turned to look behind her, she spotted a spider on her shoulder and panicked. According to the Associated Press, she leaped out of the car. Her son jumped in the front seat and tried to stop the car, but hit the gas pedal instead, and the car crashed into a school bus. Fortunately, the son had only minor injuries, the bus driver wasn’t hurt and there were no passengers on the bus.

In Esto, Florida, police responded to a reported burglary at a liq.uor store and found the front door busted and a lottery ticket dispenser missing.  About eight hours later, a man entered the store to cash in a winning lottery ticket. According to the Panama City News Herald, the store clerk notified police who arrived and confronted the man. He admitted to the earlier burglary.

In California, a federal judge ruled that Warner/Chappell Music does not own the copyright rights to the famous “Happy Birthday to You” song. He determined the song’s original copyright, obtained by the Clayton F. Summy Co. from the song’s writers, only covered specific piano arrangements of the song and not its lyrics, according to the New York Daily News. The lawsuit was filed two years ago by Good Morning To You Productions Corp., which is working on a documentary film tentatively titled “Happy Birthday.” The company challenged the copyright now held by Warner/Chappell Music Inc., arguing that the song should be “dedicated to public use and in the public domain.” The lawsuit also asked for monetary damages and restitution of more than $5 million in licensing fees it said Warner/Chappell had collected from thousands of people and groups who’ve paid to use the song over the years.

Sing freely this weekend, folks!
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 alison.mintzer@strategic-i.com

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