Insights: Trends, Research, and White Papers
Compared to large purchases, Americans were more likely to take early withdrawals from their retirement accounts during a divorce or after losing a job, according to research by the University of Michigan. Mortgage payment distress was also a major factor leading families to withdraw funds, according to a working paper by economists Frank Stafford of the University of Michigan and Thomas Bridges of the University of Delaware.
Source: Napa-net.org, May 2020
Callan conducted a mid-April survey to assess what defined contribution plan sponsors have done in response to the CARES Act and the recent economic turmoil spurred by the pandemic. The survey includes responses from 63 non-government plan sponsors, and in general, found that plan sponsor actions were primarily influenced by the industry they are in and the actions taken by their recordkeeper.
Source: Callan.com, May 2020
Fidelity Investments announced the results of the 11th edition of its Plan Sponsor Attitudes Study. According to the study, the top concern among 1,500 plan sponsors was whether their plan is effectively preparing employees for retirement financially, consistent with previous years. In late March, in the midst of market volatility and the COVID-19 pandemic, Fidelity also surveyed nearly 1,000 plan sponsors that recordkeep with Fidelity, and their top concern was employee financial well-being.
Source: Businesswire.com, May 2020
The annual BlackRock DC Pulse Survey, which takes the measure of plan sponsors, participants, and occasionally retirees, was complete by February 2020, just before COVID-19 pandemic-inspired volatility sent the market into a steep drop. This provided a unique opportunity to return to the survey population to discover what, if anything, had changed. This is a look at the key findings.
Source: Blackrock.com, May 2020
Americans continued to save for retirement through defined contribution plans early this year despite uncertain market conditions during the COVID-19 pandemic. The study tracks contributions, withdrawals, and other activity, based on DC plan recordkeeper data covering more than 30 million participant accounts in employer-based DC plans.
Source: Ici.org, May 2020
The market declines investors faced in the first quarter as a result of the coronavirus pandemic are much more muted when compared to a longer time frame. That's the key takeaway from a just released Vanguard paper.
Source: Pionline.com, May 2020
To assist employers and public retirement systems with the myriad of changes, Ice Miller has cataloged the provisions of the FFCRA and CARES Act that impacts employer-sponsored retirement plans, health plans, and other benefits in a table format. They have summarized the statutory provisions as well as related regulatory guidance that has been issued as of the date of this publication. The table includes a high-level discussion of the law and practical considerations. For a more in-depth analysis, they have provided a comprehensive discussion of each provision.
Source: Icemiller.com, May 2020
A majority of U.S. companies are making it easier for employees to access their 401k plans' assets even as some companies are cutting matching contributions amid the COVID-19 pandemic. These findings are according to the latest pulse survey by Willis Towers Watson. A total of 816 employers participated in the COVID-19 Benefits Survey, which was conducted during the week of April 20, 2020. Respondents employ 12 million workers.
Source: Willistowerswatson.com, May 2020
Many employers are taking steps to make it easier for employees to access their 401k plans under the CARES Act, but some are considering more drastic action, according to new survey results. Nearly two-thirds of respondents (65%) in the latest pulse survey by Willis Towers Watson increased access to in-service distributions from participants' 401k accounts while 16% either plan to or are considering doing so this year.
Source: Napa-net.org, May 2020
A new white paper published by Wilmington Trust documents the dramatic ongoing expansion of the U.S. collective investment trust marketplace. Among the attractive but less-often-discussed features of collective investment trusts is the fact that the sponsoring trustee -- a bank or trust company -- must commit to acting in the best interest of unitholders.
Source: Planadviser.com, April 2020
A new study finds that a significant percentage of plan sponsors have embraced the use of automatic plan design features, but adoption may have plateaued to some degree. The DCIIA plan sponsor survey reveals that 69% of plans currently offer auto-enrollment, up from 60% in 2016. And that finding generally holds for both large and small asset-size cohorts. Nearly three-quarters (73%) of plans with over $200 million in assets have now adopted the feature, up from 67% in 2016, while 63% of plans with less than $200 million in assets have now adopted it, up from 51% in 2016.
Source: Napa-net.org, April 2020
The survey, conducted by DCIIA's Retirement Research Center, represents the views of 175 defined contribution plan sponsors and is based on year-end 2018 data. Fifty-seven percent of the respondents represent plans with assets greater than $200 million. The remaining 43% of respondents have less than $200 million in plan assets. This report offers observations relative to prior survey findings, where applicable, and provides historical perspectives on how sponsor behaviors and attitudes towards auto features have developed over time.
Source: Dciia.org, April 2020
Defined contribution plan sponsors are putting more importance on their fiduciary duties, based on results from a recent survey. It also saw more plan sponsors turning to third parties for guidance as well as a growing appreciation for professional training and fee transparency. This is especially welcome news as sponsors face the disruption of their plans and their participants are grappling with market unsettledness caused by the coronavirus crisis.
Source: Alliancebernstein.com, April 2020
Workers' overall confidence in their ability to live comfortably in retirement remains steady, while the share who feel very confident continues to increase, according to the 2020 Retirement Confidence Survey from the Employee Benefit Research Institute and Greenwald & Associates.
Source: Planadviser.com, April 2020
The average 401k balance fell by 19% during the first quarter, according to data released Friday by Fidelity Investments. Despite the negative returns in the stock market and historic volatility, people continued to save, and many either increased their 401k contribution levels or opened up their first individual retirement accounts, the company stated.
Source: Investmentnews.com (registration may be required), April 2020
Defined contribution plan participants are increasingly keeping retirement balances in the plan, and a growing number of plan sponsors are interested in retaining these balances. Information gleaned from focus groups suggests that participants have misperceptions about the value of staying in plan. Some participants do not even know that staying in the plan is an option after retirement. If plan sponsors want to maintain retirees in the plan, they should not keep it a secret. They must engage with participants early and often.
Source: Troweprice.com, April 2020
The coronavirus pandemic and its effect on the stock market caused speculation in the retirement plan industry about whether plan sponsors would react with changes to their retirement plans as they did in past market crises. There was also concern about how the market drop and subsequent reaction would affect participants' retirement security. A PLANSPONSOR survey finds relatively few are taking action to suspend or decrease contributions, and they are prudently relying on providers for guidance.
Source: Plansponsor.com, April 2020
As we move through the pandemic crisis, there is hope that we will eventually be able to resume our normal lives and create better organizations and systems. With the SECURE Act, employers who sponsor DC retirement plans now have (1) new participant disclosure obligations; (2) the ability to adopt certain portability design features related to lifetime income investment options; and (3) guidelines to encourage the inclusion of lifetime income investment options in plan investment line-ups. Plan sponsors and fiduciaries should become familiar with the mandatory requirements as well as the optional aspects of these rules and determine how to leverage them to ease employee retirement concerns.
Source: Westminster-consulting.com, April 2020
In 1981, the Internal Revenue Service (IRS) proposed regulations for 401k plans that allowed pretax contributions to be made from employees' ordinary wages and salary. In the first years of these rules, employers typically offered 401k plans as supplements to their defined benefit plans. Almost four decades later, 401k plans have grown to become the most common employer-sponsored defined contribution retirement plan in the United States. Here are ten important facts about 401k plans.
Source: Ici.org, April 2020
With approximately 10,000 Baby Boomers retiring each day, the need for financial planning and advice is greater than ever, according to Cerulli. The sheer volume of retirees provides an opportunity for advisors to expand their services to more individuals approaching retirement as they navigate the complex set of decisions ahead. Cerulli's research indicates that many 401k plan participants (including half of the participants in their 50s) lack an official source of retirement advice, and this "advice gap" is particularly acute for investors in lower wealth tiers.
Source: Cerulli.com, March 2020
The retirement industry is in a period of upheaval. Several trends are converging at once, prompting retirement providers to rethink their business model and approach to participant engagement. This 16-page report examines the trends driving change and provide practical strategies for reimagining the participant experience in a digital world.
Source: Broadridge.com, February 2020
When passage of the SECURE Act in late December opened the door for unrelated small and medium-sized employers to band together to offer a Multiple Employer Plan, the idea behind it was to expand the availability of employer-sponsored retirement plans to more workers at small businesses. New Secure Retirement Institute study finds even larger employers showing interest in exploring benefits of Open Multiple Employer Plans.
Source: 401kspecialistmag.com, February 2020
More good news about fees and fee compression as plan sponsors and participants increasingly realize the long-term implications they can have on retirement. Both large and small plans saw cheaper prices for investment and administration, regardless of the situation and scenario.
Source: 401kspecialistmag.com, February 2020
Young workers have a message for their employers: They want help paying down their crushing student loan debt, rather than contributions to 401k accounts that they won’t access for decades. Two-thirds of workers age 21 to 27 said their companies should help them pay down student loans, while just over a quarter, 27%, said employers should help workers save for retirement, according to a report Wednesday from consumer research firm Hearts & Wallets.
Source: Investmentnews.com (registration may be required), February 2020
New research from the Plan Sponsor Council of America finds that more plans with automatic enrollment features are increasing the traditional defaults, helping lift savings to record levels. While the survey found that plans that have embraced this feature are building on its success in expanding participation to help workers save more for retirement. Specifically, while plans tended to set the default participant savings rate at 3 percent, the survey finds that is changing, in 2018, more than 60 percent of plans with automatic enrollment used a default deferral rate above 3 percent.
Source: Psca.org, February 2020
Fidelity released its quarterly analysis of retirement savings trends, including account balances, contributions and savings behaviors, across more than 30 million 401k, IRA and 403b retirement accounts. Positive savings behaviors among employees, enhancements to workplace savings plans and strong market conditions in Q4 2019 caused average account balances to reach record levels, as well as significant increases over the previous decade.
Source: Businesswire.com, February 2020
The image of an older couple strolling the beach is fast joining the "museum of retirement cliches," along with traditional approaches to retirement planning, a new study suggests. Retirement is no longer about reaching a certain age but is more of a mindset, and American workers close to retirement are eagerly looking forward to the next chapter in their lives, according to the survey results from the Empower Institute.
Source: Napa-net.org, February 2020
Nearly six in 10 employers (57 percent) believe that within the next five years their workers will retire at older ages than today. For many, the very definition of retirement is changing, as bridge jobs, gig work and encore careers replace the traditional notion of a fixed end to one's working life. Those are just a few of the findings from MetLife's new Evolving Retirement Model Study. It finds the traditional model of retirement -- which assumed a fixed career end date and employer-paid benefits -- is being replaced by a more transitional model.
Source: Metlife.com, February 2020
In a new study by the Investment Company Institute, 56% of DC plan participants agree that they probably wouldn't save for retirement if they didn't have a plan at work. ICI's study found that agreement was the highest (70%) among individuals with household incomes between $30,000 and $49,999.
Source: Napa-net.org, February 2020
With the SECURE Act recently enacted and several high-profile issues coming to the fore, 2020 has the potential to be a landmark year, according to a new white paper by MFS. In "Retirement Outlook 2020," MFS Senior Retirement Strategist Jonathan Barry and DC Strategist Jessica Sclafani warn that after a year of exceptional returns in 2019, "gathering headwinds" could hinder retirement plan returns in 2020 and beyond.
Source: Ntsa-net.org, February 2020
The retirement industry is potentially poised for meaningful change in 2020, which will present opportunities for plan sponsors to prepare for a lower-returning market environment, reposition defined contribution plans as retirement income vehicles for retirees, and engage with participants on the topic of sustainable investing. This paper comments on some of the key themes that sponsors may face in 2020 and provides thoughts on how sponsors and their advisors might address the opportunities available.
Source: Mfs.com, February 2020
We all know what "retirees" look like: the silver-haired couple strolling on the beach, teeing off on the links or building a birdhouse with the grandkids. But these conventional images of retirement, seen in countless financial-planning brochures, are fast joining the rocking chair in the museum of retirement cliches, along with traditional approaches to retirement planning. This 14-page survey suggests financial advisors and retirement plan sponsors can help consumers redefine retirement with new, engaging planning tools and investment products.
Source: Empower-Retirement.com, February 2020
American workers close to retirement and those who already have retired agree on one thing: the idea of retirement needs to be redefined. Retirement is no longer about reaching a certain age. It's more of a mindset and American workers close to retirement, or pre-retirees, are eagerly looking forward to the next chapter in their lives. That's according to survey results from Empower Institute, the research arm of Empower Retirement.
Source: Businesswire.com, February 2020
New data from the Plan Sponsor Council of America shows that after years of increases, the adoption of certain provisions by employer-sponsored retirement plans may have leveled off.
Source: Psca.org, January 2020
Millennials' retirement expectations are similar to previous generations: they hope to retire with adequate income that will last. However, this report by the Insured Retirement Institute finds that these expectations are not well aligned with the retirement planning steps millennials have taken thus far.
Source: Myirionline.org, January 2020
The authors believe that, by 2025, more employers will adopt some of the characteristics of the most successful pension plans to help put them on a path to create a fully funded retirement income stream for participants. They discuss changes that they hope will soon become mainstream. Their focus is on the benefits of updating investment governance structures, the need to increase savings to better fund these future "liabilities," and the importance of using more efficiently managed portfolios to increase the likelihood that employees will have successful retirement outcomes.
Source: Russellinvestments.com, January 2020
Defined contribution plan sponsors continue to make fees a main priority, according to Callan's 2020 Defined Contribution Trends Survey, but they are also focused on communicating with participants and plan to highlight the topic of financial wellness in 2020.
Source: Callan.com, January 2020
The Plan Sponsor Council of America recently released its 62nd Annual Survey of Profit-Sharing and 401k Plans, documenting a record high rate of savings, alongside an uptick in Roth contributions and other trends. However, sometimes the things that do not change can be just as telling. Here are six.
Source: Napa-net.org, January 2020
Recordkeeping data for the first half of 2019 shows that Americans were quite content saving in their 401k plans and taking advantage of the long-running bull market. According to the Investment Company Institute, only 1.3% of DC plan participants stopped contributing to their plans in the first half of 2019. This appears to be the lowest mark going back 10 years, when, for example, the data shows that 4.6% stopped contributing during the first half of 2009.
Source: Napa-net.org, January 2020
A year ago, the average 401k balance went into 2019 with a bit of a hangover. As for 2019, in a year that the S&P 500 rose more than 28%, and the Dow gained 22%, the average 401k balance -- buttressed not only by the markets, but by contributions -- ended the year 44.9% higher for those workers aged 25-34 with less than 4 years of tenure, while workers with more than 20 years of tenure, aged 55-64, registered a 24.6% increase.
Source: Napa-net.org, January 2020
With more than a year of experience with the OregonSaves plan, the Employee Benefit Research Institute asked the question: What if OregonSaves were a national program? How would that impact the retirement security of American workers? They further asked how a national version of OregonSaves would compare with nationwide implementation of 401k safe harbor plans among employers who do not currently offer a DB or DC plan. They examined both using EBRI's Retirement Security Projection Model.
Source: Ssrn.com, December 2019
The Compendium provides in-depth perspectives on retirement. This 222-page report offers 30+ key indicators of retirement readiness, preparations and attitudes among workers by employment status (full-time, part-time), generation, gender, household income, level of education, and race/ethnicity.
Source: Transamericacenter.org, December 2019
Defined contribution plan assets are a significant component of Americans' retirement assets, representing 28 percent of the total retirement market and almost one-tenth of US households' aggregate financial assets at the end of the second quarter of 2019. To measure participant-directed changes in DC plans, ICI has been tracking participant activity through recordkeeper surveys since 2008. This 16-page report updates results from ICI's survey of a cross section of recordkeeping firms representing a broad range of DC plans and covering more than 30 million employer-based DC retirement plan participant accounts as of June 2019.
Source: Ici.org, December 2019
The Plan Sponsor Council of America conducted a survey of 403b plan sponsors in October 2019 to determine their priories for their retirement plan in 2020. The survey also assessed what changes are planned in 2020 to address those priorities. Nearly three hundred 403b plan sponsors responded to the survey, representing a diverse group of organizations. This is the 15-page report on the survey results.
Source: Psca.org, December 2019
In the era of 100-year lives and with the workforce participation rate among those age 65 or older surpassing 20 percent for the first time in more than 50 years, Americans' notion of "normal retirement" is changing. Deloitte's biennial Defined Contribution Benchmarking Survey shows how plan sponsors are working to address increasingly diverse retirement needs.
Source: Deloitte.com, December 2019
The evidence presented in this chartbook -- that the retirement system does not work for most workers -- underscores the importance of preserving and expanding Social Security, defending defined benefit pensions for workers who have them, and seeking new solutions for those who do not.
Source: Epi.org, December 2019
Defined contribution plan assets have soared in recent years, rising about 90% between 2007 and mid-2019. And they are only set to climb further as defined benefit plans continue to decline and employers turn to DC plans as the sole source of retirement income for their employees. This trend is driving more innovation, more focus on compliance and competitive fee structures. This article suggests action steps in three broad areas -- financial wellbeing, investments and plan compliance -- to help DC plan sponsors address the challenges of 2020 and beyond.
Source: Willistowerswatson.com, December 2019
Building on research conducted in 2015, this 50-page white paper updates the previous estimate of participant cost savings and further explores the other benefits of electronic communication for plan participants based on current empirical evidence of internet access and technology adoption. In addition, the current research is enhanced by providers experience with electronic delivery to demonstrate the many benefits realized by plan participants from electronic communication.
Source: Sparkinstitute.org, December 2019
Compared to their older counterparts, Millennials who invest through self-directed brokerage accounts may be investing more conservatively than they should be at that age, based on the results of an industry-leading benchmarking report.
Source: Napa-net.org, December 2019
Plan sponsors have moved quickly to incorporate new, more liberal hardship withdrawal provisions, but that have not seen an increase in the number of participants taking advantage of them, says a new survey by the Plan Sponsor Council of America.
Source: Napa-net.org, December 2019
There is little doubt that the use of auto-enrollment has helped increase participation rates. But could it also lead to lower savings rates? A new white paper from T. Rowe Price, explores that possibility, examining whether automatic enrollment in a 401k plan increases lifetime wealth accumulation and benefits all participants equally.
Source: Napa-net.org, December 2019
It can be helpful for retirees to have access to investment options in their 401k plan that allow them to use their plan accounts during retirement as an effective tool to supplement their other sources of retirement income. A "Retirement Tier" is one potential solution to help these participants manage their assets properly in the decumulation stage.
Source: Truckerhuss.com, November 2019
The two areas of cybersecurity defense that sponsors should be mindful of are breaches and fraud. A breach is where there is a compromise to your information systems, and there is a large extraction of data. Fraud is when that data is used to perpetrate a financial crime. Should a breach or fraud occur, a sponsor could be liable if the claimant establishes that it failed to follow a prudent process to safeguard the plan data.
Source: Plansponsor.com, November 2019
Recent decisions by the US Court of Appeals for the Ninth Circuit have reinvigorated the debate over whether mandatory individual arbitration provisions are enforceable with respect to ERISA claims and, if so, whether these provisions are worth including in your ERISA plan document.
Source: Morganlewis.com, November 2019
Even though 401k participants are increasingly leveraging target date funds to keep their asset allocations on track, a new analysis by Fidelity suggests that many had stock allocations higher than those recommended for their age group.
Source: Napa-net.org, November 2019
Sponsors looking to make the transition to providing income solutions can choose from plan design features or additional products aimed at income creation. Recordkeepers, asset managers, and insurance companies are developing new creative solutions to expand the options that are available today. As with most plan sponsor decisions, there is not a "one size fits all" answer; each solution carries its benefits and shortcomings. In general, there are five key areas to consider when evaluating income solutions.
Source: Fiallc.com, November 2019
Today's women are better educated and enjoy career opportunities that were unimaginable 50 years ago. Despite this progress, women continue to lag behind men in terms of saving and planning for retirement. A woman's path to a secure retirement is filled with obstacles, such as lower pay and time out of the workforce for parenting or caregiving, which can negatively impact her long-term financial situation. The goal of this research is two-fold: 1) to raise awareness of the retirement risks that women are facing, and 2) highlight opportunities for women to take greater control of their finances and their future.
Source: Transamericacenter.org, November 2019
If a 60-year-old baby boomer started saving consistently at the beginning of his career back in the 1980s, he would have some $364,000 in his 401ks and IRAs today. How much does he actually have? One-fourth of that, according to a new study from the Center for Retirement Research at Boston College. One obvious explanation for the enormous gap is that the 401k system was in its infancy in the 1980s, and it took time for employers to widely adopt the plans and for young adults to get into the habit of saving for retirement.
Source: Bc.edu, November 2019
This 38-page paper develops a dynamic life cycle model to show how and whether "Rothification" -- that is, taxing 401k contributions rather than payouts -- would alter household saving, investment, and Social Security claiming patterns. The paper shows that these changes differ importantly for low- versus higher-paid workers. It concludes that moving to a system that taxes pension contributions instead of withdrawals will lead to later retirement ages, particularly for the better-educated. It also would reduce work hours and lifetime tax payments and increase wealth and consumption inequality.
Source: Upenn.edu, October 2019
To address the question of whether a retirement savings crisis is at hand, this 14-page paper takes a broader view of retirement savings, considering workplace retirement plans in the context of the greater retirement system. When this system is considered as a whole, Americans today: Have greater access to workplace retirement plans than in the past; Are saving proportionately more; Will have more money in retirement; and, Have better protections in place to help guard their savings.
Source: Empower-retirement.com, October 2019
There is clearly a growing interest among retirement plan industry stakeholders in providing guaranteed income annuity options within defined contribution plans, yet consensus remains elusive. BlackRock analysts tackle the timely and vexing issues of retirement income strategies and the potential greater use of in-plan annuity products in a new white paper.
Source: Planadviser.com, October 2019
When anticipating a merger or acquisition, coordinating and analyzing the impact of changes in employee benefits is often the last item of consideration. This 6-page guide will draw attention to the issues facing organizations when there are changes in ownership or changes in the sponsorship of an employee benefit plan.
Source: Multnomahgroup.com, October 2019
Plan sponsors, providers and legislators are showing growing interest in providing guaranteed or income annuity options within DC plans. But so far no consensus approach has emerged, and despite the rational case that can be made for lifetime income solutions, a number of participant biases and behavioral financial barriers need to be overcome to drive adoption.
Source: Blackrock.com, October 2019
A leading heavy manufacturing firm in the Midwest recognized early on that the success of their 401k profit-sharing plan could not be judged merely by participation rates, the performance of its investment options, and low-cost structure. A retirement plan must be judged by the number of its participants attaining successful retirement outcomes.
Source: 401kspecialistmag.com, October 2019
Participants provide valuable insights for plan sponsors. The 2019 PLANSPONSOR Participant Survey found that a retirement plan's initial automatic deferral rate plays an important role in what employees save. Twenty-eight percent of plan participants said they accepted the default deferral rate. Perhaps because that rate is typically low, 41% of respondents save 5% or less -- a more sizable group than the 34% last year and 35% in 2017.
Source: Plansponsor.com, October 2019
Callan recently released its 2019 ESG Survey. Here are the key takeaways, analysis, and commentary.
Source: Fiduciarygovernanceblog.com, October 2019
Analyzing data across more than 88,000 Ascensus retirement plans for which it provided recordkeeping and administrative services as of year-end 2018, the firm's research offers insights on how Americans are saving. Not surprisingly, Ascensus found that plan sponsors and savers see the value in automatic savings models. 401k plans designed with automatic enrollment and automatic escalation features saw an average plan-weighted participation rate of 81%, which was 10 percentage points higher than that in plans without automatic enrollment. Employer matching contributions offer additional motivation and an even more notable boost in plan participation when coupled with auto features.
Source: Napa-net.org, October 2019
According to the 11th annual 403b plan survey from the Plan Sponsor Council of America, increased contributions by both participants and organizations continue to have a positive impact on retirement readiness. Also, the employers that sponsor those programs have a burgeoning interest in financial wellness; a quarter of organizations have a formal financial wellness program in place. Nearly half (47%) have plans or interest in implementing one.
Source: Asppa.org, October 2019
When plan sponsors are considering what type of retirement income solution to add to their plan, they should certainly take into consideration what the participants are really looking for. They are looking for two things: Certainty and control. The ability to know that when they retire there is a baseline income that will be coming in no matter what the markets do, no matter how long they live. Yet at the same time, the accumulated savings that they have from their entire life, they have full control to take that money out, at the drop of a hat, and do whatever they want with that.
Source: Alliancebernstein.com, October 2019
The complexity of fiduciary requirements, an increasingly litigious operating environment, service provider consolidation, and a steady stream of legislative and regulatory actions can be a constant battle for plan sponsors. To help overcome these challenges, this paper identifies three questions that each plan sponsor should answer about their plan, all of which go beyond uncontrollable external influences and focus on situations where plan sponsors have control.
Source: Troweprice.com, October 2019
Expanding access to MEPs is being advocated as a significant opportunity to expand access to retirement plans, especially for employees of small businesses. This paper explores the features of MEPs today as compared to traditional single employer plans, then analyzes the potential impact opening MEPs up to more plans could have on the retirement savings landscape.
Source: Broadridge.com, October 2019
As Canadians struggle to make ends meet and manage growing debt, they're increasing putting their future financial plans -- including retirement -- on the back burner, according to a new survey by BDO Canada. The survey, which polled more than 2,000 Canadians, found more -- 39 per cent compared to 31 per cent in 2018 -- said they have no retirement savings, including 32 per cent of baby boomers and seniors.
Source: Benefitscanada.com, October 2019
A regulatory update that features a steady stream of cases from the courts, including multiple cases making their way to the United States Supreme Court for review as well as the lingering cases against colleges and universities that began in 2016. This update also includes new guidance from the regulatory agencies, including the Department of Labor, Internal Revenue Service, and Pension Benefit Guaranty Corporation.
Source: Multnomahgroup.com, September 2019
Advisers say being easily influenced by recent news is the No. 1 investor misstep, a survey found. Understanding these behavior biases can help retirement plan sponsors with communications to retirement plan participants. Recognizing behavioral biases is an important first step to keep emotions in check and avoid missteps that may have a negative impact on long-term financial goals.
Source: Plansponsor.com, September 2019
A successful retirement plan program encourages and enables its participants to build sufficient retirement savings, choose the appropriate investments, manage investment risk, and generate a lifetime of income. Although there exist nearly as many retirement plan structures as individuals who participate in them, not all plans are created equal and plan design can significantly influence savings and retirement decisions. However, due to the number of options available, plan design can be a complex undertaking. Learn more about the plan design features that will boost your plan participants' readiness for retirement.
Source: Planpilot.com, September 2019
Newport Group's Fiduciary Consulting practice has developed a robust methodology for evaluating and monitoring target-date funds. It is designed to be a prudent process that lives up to the rigorous demands of ERISA. This paper describes the details behind our evaluation and monitoring process, and provides an understanding of why such specialized due diligence is essential for target date strategies.
Source: Newportgroup.com, September 2019
Mandatory retirement policies are mostly illegal in the US, but their disappearance has become a point of concern for those worried about future generations.
Source: Hrdive.com, September 2019
Employment agreements cover a wide range of topics, from setting the compensation terms to protecting a company's intellectual property rights. It's not surprising, then, that plan fiduciaries put terms in employment agreements aimed at limiting their exposure. The goal is to limit litigation and instead require arbitration for resolving ERISA claims. They may also choose to try to limit the claims period or set the jurisdiction in which the claims are heard. Whether or not these limitations are allowed is still a topic being debated by the courts.
Source: Hallbenefitslaw.com, September 2019
Amid heightened concern over an aging workforce, increasing longevity and the financial health of their workers, a growing number of U.S. employers are adding lifetime income solutions to their defined contribution retirement plans, according to the 2019 Lifetime Income Solutions Survey by Willis Towers Watson.
Source: Willistowerswatson.com, September 2019
Approximately 52% of respondents admit to tapping their retirement savings account early for a purpose other than retiring, according to a survey by MagnifyMoney. The two main reasons respondents cited for withdrawing money from their retirement savings are home ownership and personal debt. According to the survey, 23% of those making an early withdrawal did so to help pay down non-medical debt, while 17% needed the money for a down payment on a home.
Source: Plansponsor.com, August 2019