PLANADVISER Weekend Newsdash
Week ending July 13th, 2018

Happy Friday, readers! In focus for this edition of PLANADVISERweekend is the always timely topic of Investing, and more specifically, how to weigh risk and reward on retirement plan fund menus. We hear from several providers how growth in target-date fund usage continues to be incredible; missing is a deeper discussion of sequence of returns risk and other potential challenges for participants associated with this growth. We also examine research from Cerulli, pointing to a number of drivers behind the acceleration in asset management fee compression; the research and analytics firm also analyzes the competitive landscape of “robo-advice.” As always, we encourage you to share some of what you learn with a client or colleague.

Investing
Getting Serious About TDF Sequence of Returns Risk
The growth in target-date fund usage continues to be incredible; missing is a deeper discussion of sequence of returns risk and other potential challenges for participants associated with this growth. Read more >
Asset Management Fee Compression Accelerates
New research from Cerulli points to a number of drivers behind the acceleration in asset management fee compression, tied to improved automation and stronger competition; the research and analytics firm also analyzes the competitive landscape of “robo-advice.” Read more >
401(k) Participant Mutual Fund Expense Ratios Declined Substantially Since 2000
The Investment Company Institute also found 401(k) plan participants investing in mutual funds tend to hold lower-cost funds. Read more >
Segal Warns Against Change to Actuarial Assumptions for Multiemployer Plans
To determine the impact of such a change, the firm performed a detailed analysis of two national multiemployer plans. Read more >
Experts Probe Potential Signs of Variable Annuity Sales Recovery
Variable annuities continue to face challenges in the wake of transaction processing disruptions caused by the now-vacated DOL fiduciary rule; however, experts anticipate sales to recover as business processes normalize and newer product types come to market. Read more >
SEI Warns That Many TDFs Are Too Risky
SEI has been talking to TDF managers about deploying strategies within their investment lineup that mitigate the potential downside. Read more >
MOST POPULAR STORIES
Education About Tax Treatment and Fees Could Boost 401(k) Participation

Findings from a Capital One survey about why employees do not participate in their employer-sponsored retirement plan offers opportunities for education, according to Stuart Robertson.

IRS to Focus on Retirement Plan Distributions and 403(b) Plan Rules in 2019

A Program Letter lists compliance strategies for the agency for next year.

Inertia Remains a Plan Sponsor Problem, Too

The language of “inertia” and “disengagement” are often used to describe the natural state of retirement plan participants, but new research from Wells Fargo suggests plan sponsors are also prone to settling with the status quo.

How Rising Interest Rates Affect Stable Value Funds
While money market funds may look more appealing in the short run, this is not expected to last.
Open MEPs Could Create Many Opportunities for Advisers
Should Congress or federal regulators eliminate the common nexus and bad apple rules that have held back open multiple employer plans, experts anticipate many more small businesses will jump in.

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

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

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