Newsdash Insight on Plan Design & Investment Strategy from PLANSPONSOR
January 25th, 2018

From the Magazine: The Next Step

“A lot of information that was provided as education to participants before included what constitutes investment advice under the new rule, meaning it is tailored to a participant’s specific circumstances,” says Brian Tiemann, partner at McDermott Will & Emery. “Advisers and recordkeepers can still provide education that is general information on a plan and its investment options—factual information. Advice is when they cross the line into a recommendation, where it involves talk of a participant’s own circumstances.” Read more >
Would Americans Balk at Mandated Offering of DC Retirement Plans?
With the Affordable Care Act and other pieces of major legislation that altered financial norms a guide, one expert asks whether a mandate to require employers to provide auto-enrollment retirement plans is a good idea against the backdrop of stubborn American individualism. Read more >
Fixed-Income Focus: How to Hedge Against Equity Underperformance
While much attention is being paid to equity holdings, because the market has been delivering strong gains since the Great Recession, advisers need to make sure defined contribution plan sponsors include the appropriate fixed-income options in their investment lineups, and that defined benefit plan sponsors are using the appropriate fixed-income vehicles in their portfolios, as well. Read more >
Forced Arbitration Denied in Charles Schwab Self-Dealing ERISA Class Action
The judge notes the Federal Arbitration Act represents “a liberal federal policy favoring arbitration agreement, notwithstanding any state substantive or procedural policies to the contrary.” But even with such a liberal standard in place, the judge found Charles Schwab’s motion to mandate arbitration to be unconvincing. Read more >
Norton Healthcare Faces 403(b) Plan Excessive Fee Suit
Plan fiduciaries have been charged with breaching their fiduciaries duties under ERISA by selecting more expensive share classes of investments than were available to the plan. Read more >
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Many Retirees Spending More Than They Expected
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Consider All Individual Circumstances Before Suggesting 4% Retirement Income Withdrawal
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Progressive Plan Design Features Have Moved Down-Market
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ERISA Litigators Reflect on Lessons Learned in 2018
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MetLife Pension Calculations Questioned in ERISA Complaint
Finworx Launches Finworx 360 to Help Advisers Assess Clients’ Risk Tolerance.
The software includes a Behavioral Risk Survey that advisers can give to retirement plan participants. Read more >
401(k) Participants’ Equity Holdings Drop As They Age
The younger the investor, the more likely they are to have their money invested in equities, while older investors are more likely to gravitate to fixed-income securities, including bond funds, money market funds, stable value funds and guaranteed investment contracts, ICI found. At year-end 2015, for example, participants in their twenties had 80% of their portfolios invested in equities. For 401(k) participants in their sixties, this drops to 55%. Read more >
Personalized Videos Adds to List of Targeted Features
Voya Financial says these new one-minute videos will combine an individual’s “monthly income replacement goals, estimated monthly retirement income and possible shortfalls” to visualize their path towards retirement.  Read more >
Wednesday, the Dow was up 41.31 points (0.16%) at 26,252.12, the NASDAQ closed 45.23 points (0.61%) lower at 7,415.06, and the S&P 500 decreased by 1.58 points (0.06%) to 2,837.55. The Russell 2000 lost 11.09 points (0.69%) to finish at 1,599.61, and the Wilshire 5000 was down 38.32 points (0.13%) at 29,434.66. The price of the 10-year Treasury note was down 10/32, increasing its yield to 2.653%. The price of the 30-year Treasury bond decreased 20/32, bringing its yield up to 2.930%.

Editorial: Alison Cooke Mintzer alison.mintzer@strategic-i.com

Advertising: Paul Zampitella paul.zampitella@strategic-i.com

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