Hot off the Presses
Participant and Sponsor Tools
Plan participants with retirement plans and health savings accounts (HSAs) from Wells Fargo can track their accounts online for an integrated picture of their financial assets, including checking, savings and credit card balances, outstanding loans, and insurance. This information can also be accessed using a smartphone or tablet via the Wells Fargo Mobile application (app).
Plan sponsors can address the issue of fairness in allocating plan expenses among participants with J.H. Signature 2.0, what John Hancock Retirement Plan Services calls “a more intuitive way of pricing plan services.” The system expands the firm’s revenue-sharing allocation solution and uses its “required revenue” concept to establish pricing that is independent of a fund lineup or participant investments.
Fidelity Investments unveiled a suite of tools and technologies with a heightened focus on retirement outcomes, so employers can measure plan effectiveness, analyze saving behaviors and help employees make optimal decisions. The goal is to achieve better outcomes by improving four critical areas: savings rates, asset allocation, cashing out of the plan, and loans and withdrawals.
The ADP Mobile Solutions application (app) is now available in the Amazon Appstore, as well as from Google and Apple. Employees who work for an ADP client can access information about their retirement, pay statements, attendance, benefits and flexible spending accounts (FSAs). The app also allows users to download and print W-2 forms from any mobile device.
Vanguard has ended administration services for defined benefit (DB) retirement plans but will continue to provide defined benefit plan sponsors with low-cost investments, as well as trustee, payment and investment advisory services. The change enables the firm to further expand services for defined contribution (DC) retirement plans.
The Retirement Readiness Report Card from Great-West Financial uses key metrics to help plan sponsors evaluate a plan’s ability to achieve positive retirement outcomes. The tool tracks plan participants’ investment allocations, savings rates, age demographics and income replacement percentages. Sponsors can use the data to enact plan design strategies that meet the specific needs of their participants.
An online tool from America’s Best 401k compares plan fees, using data from the Department of Labor (DOL)’s Form 5500 database to assess average investment-related costs. A free report allows plan sponsors and participants to better understand the effects of these costs over time.
Automatic features can substantially improve participant outcomes, according to BMO Retirement Services’ “BMO Defined Contribution [DC] IQ: Automatic Features,” the first in an educational series on plan design, participant utilization of plan features and operational efficiency. The paper identifies questions for plan sponsors to address, such as when to automatically enroll employees, which default investment option to use and what annual auto-escalation rate to adopt.
Adviser Tools
Registered investment advisers (RIAs) can create a mobile presence for their firms with Schwab OpenView Mobile, a customizable application (app) from Charles Schwab. Technology professionals from the Schwab Performance Technologies division will work with advisers to create unique, branded applications that will be submitted to the Google Play and iTunes App stores on a firm-by-firm basis.
A nonqualified deferred compensation (NQDC) platform, EXEC360 from National Financial Partners Corp., can help advisers improve outcomes in small and midsize plans. The open-architecture platform provides sales support; dedicated participant and sponsor sites; case design services; plan documentation; and implementation and administrative services, the latter of which include recordkeeping, client services and annual enrollment.
An educational program from State Street Global Advisers (SSgA), “SPDR ETF Ed U,” is composed of 28 short courses about incorporating Standard & Poor’s (S&P) depositary receipt exchange-traded funds (ETFs) into investment portfolios. Two of the six modules—“How to Evaluate ETFs” and “ETF Myths and Truths”—meet continuing education credit requirements for some certification programs. A self-assessment can help advisers develop more personalized training regimens.
The 401(k) Choice platform from Alliance Benefit Group (ABG) offers a single point of contact for broker/dealers (B/Ds) and advisers to manage plan-related services. The platform’s back-office trade-processing and custodial solution, from Broadridge Financial, integrates outsourced fiduciary support features, advanced plan design options, and investment analytics and management tools.
The Fundamentals of Alternative Investments Online Certificate Program, created by the Chartered Alternative Investment Analyst (CAIA) Association and the Investment Management Consultants Association (IMCA), aims to deepen understanding of alternative investments for advisers. Twenty hour-long modules cover portfolio construction, risk management and due diligence, along with sections on hedge funds, real assets, private equity, commodities and structured products.
Succession planning resources from NFP Advisor Services help advisers buy or sell a practice. Transition-readiness tools shine a light on the critical components of a transaction and assess an adviser’s immediate and long-term needs, to provide a customized timeline and specific guidance. Consultants with NFP Succession Planning can help secure financing by directing advisers to experienced sources.
“Putting a Value on Your Value: Quantifying Vanguard Advisor Alpha,” a research paper from Vanguard Advisor, examines individual best practices and quantifies the value advisers can add—as much as an extra 3% in net returns for clients, based on the adviser’s use of five wealth management principles. Monetizable practices include behavioral coaching, cost-effective investing and maintaining proper allocation through rebalancing.
Investments
State Street Global Advisors (SSgA) unveiled the SPDR Barclays 0–5 Year TIPS [Treasury inflation-protected securities] ETF, an exchange-traded fund (ETF) that aims to shore up holdings against inflation. Fixed-income allocations within the fund are diversified to prepare for rising interest rates.
Two indices from Thomson Reuters—the Private Equity Buyout Index and the Private Equity Buyout Research Index—track performance in the U.S. private equity industry, using the firm’s proprietary data. One index is an investable product; the other is designed for research purposes.
Lincoln Financial Group unveiled the Presidential Managed Risk Moderate Fund, a balanced fund constructed from diversified exchanged-traded funds (ETFs), including Vanguard, State Street and iShares. A risk management overlay with broad exposure to financial markets seeks to protect investors during periods of volatility.
Bank of New York (BNY) Mellon is again accepting new investors into the Mellon Stable Value Fund, a bank-sponsored collective investment fund (CIF) for defined contribution (DC) benefit trusts. The fund stopped accepting new investors in January 2012, because of an industrywide shortage of investment contracts.
Charles Schwab rolled out a unit class for its Schwab Managed Retirement Trust (SMRT) Funds with a lower operating expense ratio of 35 basis points (BPS). The SMRT Funds factor in market considerations and evolving participant needs to change not only equity and fixed-income exposures, but also adjust the levels of active management and passive indexing.