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week ending August 14th, 2020
Despite the bounce back of the markets since March, interest rates are keeping defined benefit (DB) plan funded status down. The magnitude of funded status decreases depends on plans’ portfolio strategies and plan sponsors should consider new strategies to manage the ongoing volatility of the market. At a time when their businesses could be struggling financially as well, plan sponsors need guidance on how to cut costs. Portfolio and cost-cutting strategies need to be considered even if a plan is frozen. This edition of PLANSPONSOR Weekend contains information to help DB plan sponsors with plan management. Have a great weekend!
Editor's Choice
Lower Interest Rates Foil Market Rally Impact on DB Plan Funded Status
Firms that monitor DB plan funded status say it is uncertain whether Congress will offer additional funding relief; many plans will likely face lower funded status in 2020.
DB Focus
Same but Different
Lessons on past market breaks, from seasoned bond investors.
How DB Plans Fare During Volatility Depends Greatly on Portfolio Allocation
Depending on asset allocation, some plans have fared better than others, but the majority are down for the year.
Rethinking Portfolio Strategies for DB Plans
What strategies should plan sponsors consider for reaching their goals in the new market environment?
DB Focus
Blight Resistant
Private equity is a bright spot for investors at this time.
Forty Percent of DB Plans Could Adopt Strategies to Lower PBGC Premiums
Strategies regarding timing and recording of pension contributions translate to millions of dollars in lower PBGC premiums, according to a report from October Three.
Frozen DB Plans Still Require Much Attention
There is nearly as much work to do when a DB plan is frozen as when it’s open, and ignoring it could come at great cost.
Popular Reads
2020 Recordkeeping Survey
MGM Resorts Hit With 401(k) Plan Excessive Fee Suit
The allegations are similar to many other pieces of litigation challenging the use of actively managed funds over passive funds and the use of higher-cost share classes.
2019 Recordkeeping Survey
Five hot-button issues plan sponsors need to cover in provider searches.
The Push and Pull of CITs
Lawsuits act as a reminder that a prudent review of fee costs is essential.
PSNC 2020: Evaluating Service Providers
The COVID-19 pandemic was a test for provider relationships. Did plan sponsors see their providers as real partners or did they see a change was needed, and how might RFPs be different going forward?
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