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Insights: Trends, Research, Analysis, and White Papers
Small Business "Bullishness" Helping to Drive 401k GrowthADP Inc., Guideline Inc., and Human Interest were among the top recordkeepers in adding defined contribution retirement plans in 2023, with all three pointing toward continued growth in 2024, according to the 2024 PLANSPONSOR Recordkeeper Survey and executive interviews. Recordkeepers overall showed a strong year of DC plan additions in 2023, as compared with the prior year. Tailwinds including employer talent attraction and retention needs, SECURE 2.0 Act of 2022 tax incentives, and state mandates are all driving new plan growth, according to firm executives, with signs they may outdo themselves again by the end of 2024. Source: Planadviser.com, July 2024
401k Mutual Fund Fees Have Fallen Dramatically Since 2000401k plan participants have incurred substantially lower fees for holding mutual funds over the past two decades, according to new research released today from the Investment Company Institute. Their research shows that from 2000 to 2023, the average equity mutual fund expense ratio paid by 401k investors dropped by more than half (60%), offering them higher returns and higher balances in retirement. The average bond mutual fund expense ratio has dropped by 63%. Source: 401kspecialistmag.com, July 2024
401k Investors Benefit as Mutual Fund Fees Cut in HalfThe latest research from the Investment Company Institute shows that 401k plan participants have incurred substantially lower fees for holding mutual funds over the past two decades, offering them higher returns and higher balances in retirement. From 2000 to 2023, the average equity mutual fund expense ratio paid by 401k investors dropped by more than half. Source: Ici.org, July 2024
Lies and Statistics -- What the 401k Data Actually Says: PodcastFormer high-ranking Social Security Administration official and retirement policy gadfly Andrew Biggs joins American Retirement Association CEO Brian Graff for a frank discussion about the data fueling the 401k debate. Biggs, a frequent financial media critic of "retirement crisis" sensationalism, explains the retirement readiness disconnect and why we get it so wrong. Source: Asppa.org, July 2024
Making 401k Saving Hard to Avoid: PodcastNo matter how easy plan sponsors try to make it for employees to participate in their company-sponsored 401k plan, too many workers still aren't enrolling. Podcast guests on today have some ideas on dealing with this problem, centered on how instead of making it easy to participate, making it even harder to avoid enrolling in the plan in the first place. Source: 401kspecialistmag.com, July 2024
Design Options: Building Strong Retirement PlansRetirement plan design is increasingly focused on getting employees enrolled sooner, keeping them in longer, and providing more options for creating income people can rely on in retirement. The design elements plan sponsors are considering include immediate plan enrollment, lowering the eligibility age to contribute, larger arrays of product sets to accommodate decumulation, and providing participants with nonguaranteed and guaranteed investments and options to support, converting their accumulated retirement savings into a paycheck in retirement. Source: Plansponsor.com, July 2024
Technology Integration "Linchpin" for In-Plan Retirement IncomeGetting in-plan retirement income options to take hold will in large part rely on the technology making it possible, according to a recent recordkeeping survey by the Defined Contribution Institutional Investment Association's Retirement Research Center. Middleware providers that offer annuity incorporation and portability across retirement plan recordkeeping platforms will play a key role in uptake, says the DCIIA research group. Source: Planadviser.com, July 2024
2024 Living in Retirement ReportFindings on the financial challenges and concerns of retired Americans from the Schroders 2024 US Retirement Survey. Study finds inflation taking a toll on retirees. The worst bout of inflation in decades is weighing heavily on the minds of retirees. Source: Schroders.com, July 2024
2024 US Retirement Readiness ReportSchroders recently surveyed 2,000 US investors nationwide to learn more about the state of retirement readiness and planning, key concerns regarding retirement, and current sentiment among those who are already living in retirement. Source: Schroders.com, July 2024
Are There "Hidden Costs" in Pension-to-401k Shift?A recent analysis by the National Conference on Public Employee Retirement Systems links pension reforms to income inequality, claiming that middle-class participants could be paying more as the retirement industry shifts from DB-style plans to DC strategies. Source: 401kspecialistmag.com, July 2024
Fidelity Reveals Top Five Optional Provisions Plan Sponsors Are Most Likely to AdoptThe increase in catch-up contribution cap for participants aged 60 to 63 and the expanded in-service distribution choices made possible by the SECURE 2.0 Act were among the top-ranked optional provisions that advisers might see plan sponsors wanting to adopt, according to respondents from a June survey by Fidelity Investments titled "SECURE 2.0 Optional Provisions Survey Insight." Source: Planadviser.com, June 2024
SECURE 2.0 Optional Provisions Survey InsightsFidelity recently invited over 2,000 clients to participate in an optional provision survey to obtain insight into client intentions. Top-ranked optional provisions reported by respondents include features such as the increased catch-up contribution limit for participants ages 60 to 63, as well as the new in-service distribution options made available under SECURE 2.0. Read this 5-page report to learn more about the emerging trends and considerations for plan sponsors as you evaluate SECURE 2.0 optional provisions. Source: Fidelityworkplace.com, June 2024
Plaintiff Lawyers Can Now Use AI to Identify Potential Plan IssuesTech and legal firm Darrow uses AI as a tool for ERISA lawsuit allegations such as underperforming plans and excessive fees. Attorney Levine, who often represents fiduciary defendants, says that the use of AI in this field of law is relatively new, but its use is "very much a data processing tool," and little else. Fiduciaries should generally follow the same principles as before, he says, but since AI models tend to focus on data procured from Form 5500s, sponsors should consider evaluating their Form 5500 reporting to be sure everything is accurate. Source: Planadviser.com, June 2024
The Growing Trend of Collective Investment TrustsMany plan fiduciaries express surprise when learning that Collective Investment Trusts have existed longer than their 40 Act Mutual Fund counterparts. Collective trusts are similar to mutual funds given investors in both pool assets with others and own a portion of the fund. Both vehicles are daily valued and provide investors with a Net Asset Value. Additionally, both vehicles are professionally managed, audited annually, and provide investors with periodically produced "fact sheets." However, there are several key differences between mutual funds and CITs. Source: Fiducientadvisors.com, June 2024
How America Saves? At a Record Pace in 401k, Vanguard FindsThe report found that the average participant deferral rate matched the historic high of 7.4% in 2023 (the median deferral rate was 6.2%). When combined with employer contributions, the average participant total savings rate kept pace with the all-time high of 11.7% (median 11%), reached the prior year. Source: 401kspecialistmag.com, June 2024
Business Owners Delay Retirement Due to Savings FearsWhile most business owners say they're on track for retirement, recent findings from Nationwide show that just over a third (36%) have postponed their retirement in the past year. This concern is even more prominent for small business owners, with 57% who say they have pushed back their retirement timelines. Source: 401kspecialistmag.com, June 2024
CITs Assert Greater Dominance in DC PlansThe growing adoption of collective investment trusts in the DC market has raised questions about whether mutual funds are heading toward obsolescence. Factors such as pricing, fee transparency, and investment minimums are just a few variables that shape whether mutual funds will remain a competitive investment vehicle, according to the latest Cerulli Edge--U.S. Retirement Edition. Source: Cerulli.com, June 2024
The Future of Mutual Funds Amidst CIT GrowthWhile mutual funds have largely dominated 401k plans in the past, increases in CIT usage have led some experts to question whether the funds are slowly phasing out of the U.S. retirement system. A recent report from Morningstar found that CITs are currently on pace to overtake mutual funds as the most popular target-date vehicle in 2024, as they now represent 49% of the 401k market. New research by Cerulli Associates questions the future state of mutual funds. Source: 401kspecialistmag.com, June 2024
Institutional Plan Consultants: Nearly 90% of Clients Want Income SolutionsInstitutional defined contribution consultants are getting this message from nearly 90% of clients: We want retirement income solutions to offer our participants, according to PIMCO's 2024 DC Consulting Study. In a study capturing data, trends and opinions from 28 consulting and advisory firms working with more than 15,000 clients representing more than $7.9 trillion, respondents said 90% of large institutional clients put retirement income solutions of both guaranteed and non-guaranteed options as a top priority, a 21% increase over 2023. Source: Planadviser.com, June 2024
Strong Plan Committees Have Documentation, FlexibilityWhen it comes to running strong retirement plan committees, organization, documentation and flexibility are some of the key strategies for plan sponsors and their advisers to follow. Success comes not from following a set list of procedures, but creating the process that will best meet the plan sponsors goals and sticking to it. Source: Planadviser.com, June 2024
Most Workers are Unknowingly Skimping on Their 401ksA large chunk of US employees are not making contributions to their workplace retirement plans, and they don't even know it. A new poll from Principal sheds light on employee confusion around workplace retirement plans, and how good plan design could help solve the problem. Source: Investmentnews.com, June 2024
Employees Mistakenly Believe They're Contributing to RetirementOver half of employees who say they're contributing to their retirement are not, reports new findings from Principal's Retirement Security Survey. According to the report, which fielded responses from 2,050 workers, 59% of employees who are not contributing to their 401k or other workplace plan believe they are. Another 77% think they began saving after becoming eligible to contribute, showing a serious lack of retirement planning education and communications among workforces and their employees. Source: 401kspecialistmag.com, June 2024
Plan Sponsors Focusing on Retirement Income SolutionsA greater number of DC plan sponsors are prioritizing retirement income solutions, according to a recent report by PIMCO. The firm's latest study found that nearly 90% of large institutional consultants say the top priority for clients is to find solutions for generating income in retirement, a 21% increase over the previous year. Source: 401kspecialistmag.com, June 2024
What Keeps Employees From Contributing to Their Workplace Retirement Plan?Nearly six-in-10 employees (59%) who are not contributing to their 401k or other workplace retirement plan think they are, according to the latest Principal Retirement Security Survey. Three out of every four of those employees (77%) believed they started saving upon becoming eligible to contribute. This misperception, compounded by persistent inflation and elevated interest rates, makes it harder for Americans to reach their retirement goals, according to Principal. Source: Principal.com, June 2024
The Missing Link: Adding Emergency Savings Solutions to Retirement PlansThe passage of SECURE 2.0 brought new in-plan emergency savings solutions. What have the past five years of research taught us about the connection between short-term and long-term financial security? And how can 401k plans benefit from lessons learned? Source: Blackrock.com, June 2024
How Does Inflation Impact Near Retirees and Retirees?Because inflation has been so low for so long, the risks of inflation have been generally overlooked and recent history does not offer much practical insight on its impact. This article, which is the first of two based on a new study, illustrates the financial consequences of high inflation by using economic theory and hypothetical households to trace possible paths of consumption and wealth under different macroeconomic scenarios. Source: Bc.edu, June 2024
Why are Employees Not Participating in Their 401ks?To better understand the reasons behind low participation, the Principal Group surveyed people eligible for their workplace retirement plans but currently not contributing. This is an 11-page report on their findings. Source: Principal.com, May 2024
In Defense of the 401k PlanDo 401k plans deserve a failing grade? An objective answer would be no because the critics haven't adequately addressed relatively recent developments that, if given a chance to take hold, could substantially improve the existing private employer system. This could be done without creating a new bureaucracy or requiring the federal government to start funding 401k plans. This article reviews some relatively recent developments that could make 401k plans more accessible and easier for employers to run and employees to navigate. Source: Cohenbuckmann.com, May 2024
401k Account Balances Reach Record LevelsAccount balances rose to their highest levels since the fourth quarter of 2021, thanks to record-high contribution levels and positive market conditions, reports a new retirement analysis out today by Fidelity Investments. For 401k accounts, balances increased 6% from Q4 2024, to achieve $125,900. IRAs saw a 10% rise and totaled $127,745 in Q1, while 403b accounts moved up 7% for a total of $113,000. Source: 401kspecialistmag.com, May 2024
Employees Falling Short of Retirement ObjectivesMost employees are not on track to meet their retirement goals, motivating them to improve their understanding of retirement readiness, fundamental investment strategies, and other financial wellness topics, according to Qualified Plan Advisors' second annual Financial Wellness Report. The statistics align with much of the retirement industry's recent push to provide financial wellness programs and resources to employees alongside 401ks and other savings programs. Source: Planadviser.com, May 2024
Is Your DC Plan Retirement Ready? Helping Participants Get to and Through RetirementIn this 18-page whitepaper, the Groom Law Group covers defined contribution plan design and lifetime income options for fiduciaries. It examines the shift in retirement income, types of lifetime income options, the basics of being a fiduciary, tips for fiduciaries on how to mitigate risks, and more. Source: Groom.com, May 2024
401k Managed Account Investors More Confident in Retirement Investment Strategy Than Non-Advice UsersAs the retirement industry continues its transition away from the defined benefit system, the onus is increasingly placed on individual plan participants to educate themselves and implement an appropriate retirement investment and income strategy. Cerulli finds that many plan participants are not equipped to handle this responsibility on their own; only 16% of non-advice users reported feeling very confident in their retirement investment strategy. By comparison, 47% of DC-managed account program users reported feeling very confident in their strategy. Source: Cerulli.com, May 2024
White-Black 401k Gap Widens for the Old and the RichThe stark difference in Black and White workers' wealth is old news. But now we have some fresh information about the wealth gap: it grows as people age and move through their retirement years. The most striking deterioration in Blacks' relative standing can be seen in non-housing wealth. This mainly consists of 401k-style plans and savings and investment accounts and does not include the wealth inherent in retirees' Social Security or employer pensions. Source: Bc.edu, May 2024
Retirement Planning: Does It Make Sense to Plan to Age 95?A new report provides an interesting take on whether it makes sense for retirees and near-retirees to base their retirement planning on the industry-wide assumption that they will live to age 95. Instead of simply using age as a factor in determining how much to save and spend for purposes of retirement planning, the report by HealthView Services examines the financial impact for clients planning to age 95 versus beginning the discussion using actuarial longevity based on health conditions. Source: Asppa.org, May 2024
Small Businesses are Growing, but Will That Translate to More 401ks?May is National Small Business Month, and small businesses seem to be faring pretty well both in terms of growth and hiring, according to recent reports. The strength of small businesses, combined with state mandates and federal incentives, should in turn help with increasing workplace retirement plan coverage. Source: Planadviser.com, May 2024
AT&T Fee Lawsuit Could Reach Supreme Court Next YearAT&T was initially sued in 2017 for a breach of fiduciary duty when it amended contracts to add brokerage and investment advisory services offered by Fidelity Investments for their participants in 2012 and 2014, respectively. The plaintiffs alleged that AT&T did not evaluate or disclose the compensation paid to Fidelity when it added these services. The complaint added that the fees were a prohibited transaction, did not comply with the terms of any exemption, and that the plan sponsor had not followed a prudent process. Source: Planadviser.com, May 2024
How Many Retirees Are Actually "Living a Nightmare"?A recent headline fans the flame of retirement panic but just take a look at the actual data. The source of the data was Schroders' 2024 U.S. Retirement Survey, which did find some retirees characterizing their existence that way, in this case, "some" was 4%. That's right, just 4%, which, coincidentally enough happened to match the number that said they were "living the dream". Source: Napa-net.org, May 2024
How AI Is Impacting DC Plan Members' Financial DecisionsWhile artificial intelligence may one day be able to remove human bias from financial decision-making, that development remains far in the future, said Lisa Kramer, a professor of finance at the University of Toronto's Rotman School of Management, during the keynote session at Benefits Canada's 2024 Defined Contribution Plan Summit in February. Source: Benefitscanada.com, May 2024
Saver's Match Could Have a Major Impact on 401k Race, Gender GapsHow will the Saver's Match contained in SECURE 2.0 affect race/gender disparities in 401k balances? It's a question tackled in the latest analysis from the Collaborative for Equitable Retirement Savings, comprised of three high-profile retirement plan research organizations. It found that the Saver's Match "would help close the racial wealth gap in 401k plans, particularly for Black females while providing benefits to workers across all races." Source: Asppa.org, May 2024
Plan Sponsors Focused on Reining in Fees: CallanReviewing plan fees continues to be a top priority of defined contribution plan sponsors, according to Callan’s recently released 2024 Defined Contribution (DC) Trends Survey. The survey found top areas of focus for DC plan sponsors include plan governance and process, investment management fees, and administration fees. Fiduciary initiatives in 2023 centered on reviewing plan fees, the investment policy statement, and the investment structure. Things the survey found will also be top areas of focus in 2024, with reviewing plan fees as the highest priority (74%). Source: 401kspecialistmag.com, April 2024
One-Third of American Workers Have Zero Retirement SavingsAmericans workers are not in the position to retire anytime soon, finds a new Q2 report by Schroders. The "DC Lens Q2 2024" report underlines some bleak updates to the state of participants' retirement readiness. According to the analysis, 28% of people have zero savings for their retirement, 39% are not contributing to a retirement fund, and 30% don't see a future where they can retire. Source: 401kspecialistmag.com, April 2024
Nine Key Findings from EBRI's 2024 Retirement Confidence SurveyWorkers' and retirees' confidence has not yet fully recovered from the significant drop seen in 2023, but majorities remain optimistic about their retirement prospects and the lifestyle they envisioned, according to the 34th annual Retirement Confidence Survey, published by the Employee Benefit Research Institute and Greenwald Research. Here are some of the key findings from the survey of 2,521 Americans. Source: 401kspecialistmag.com, April 2024
Understanding the Drivers of Retirement ConfidenceDynata, an independent third-party research provider, conducted a study among 1,000 DC plan participants in the US on behalf of MFS. In this article, MFS shares the responses from the participants in three sections: market event impacts, retirement confidence, and the power of quality advice. Source: Plansponsor.com, April 2024
Advanced Recordkeeping Technology Allows for More Personalization in TDFsWhile target-date funds have become commercially successful and are often the default investment vehicle in retirement plans, they have also received flack for not being sufficiently well diversified and that a glidepath with declining equity allocations over time is not optimal for all participants. However, according to a recent paper by T. Rowe Price in The Journal of Portfolio Management, as recordkeeping technology continues to evolve, there is increasingly more opportunity for target-date funds to become more personalized, down to the participant level. Source: Plansponsor.com, April 2024
Is a New Age on the Horizon for 401k Participants?The average retiree faces numerous unknowns, a slew of psychological obstacles to maneuver, and, on top of all that, math. And, as current savings and spending patterns show, retirees need help making these monumental decisions. BlackRock's Larry Fink is optimistic that the firm's newly launched BlackRock LifePath Paycheck target-date series, which includes an annuity as part of the glide path, can be the solution retirees are looking for. This Morningstar article explores how we got here with a brief, and imperfect, history of retirement-income solutions. Source: Morningstar.com, April 2024
Report Reveals 403b Plan Sponsors Support Retirement Saving and InvestingEmployers' commitment to their 403b plan participants is evident in a new report just released by the ICI. Analyzing the plan year 2020 data for large 403b plans filing Form 5500 under the ERISA, the report finds that nearly one-third of large ERISA 403b plan participants were in plans that put their employees on the path to retirement saving with automatic enrollment. Source: Ici.org, April 2024
Why Do Some Small Businesses Offer Retirement Plans?Numerous studies have shown that offering a retirement plan is closely related to firm size; firms with fewer than 100 employees are much less likely to offer a plan than larger firms. As a result, observers tend to dismiss small firms as a source of future growth in coverage. However, a meaningful share of small businesses do offer retirement plans. The purpose of this study is to identify the characteristics of sponsoring firms and their employees to determine which small businesses may be more likely to offer a retirement plan in the future. Source: Bofa.com, April 2024
For Most Near-retirees, Leaving the Workforce at 65 Is a Lost CauseThe retirement landscape in the US is shifting dramatically as a significant portion of the population approaches the traditional retirement age of 65, a goal many say is increasingly out of reach, according to a new survey by Nationwide. The findings of the survey, which drew responses from around 500 advisors and roughly 2,400 investors, reflect a trend of financial insecurity and the fact that many workers must now work beyond the traditional retirement age of 65. Source: Investmentnews.com, April 2024
Participants Prefer SECURE 2.0 PLESA Benefit Over Withdrawal FeatureA new survey by Commonwealth analyzes the impacts of SECURE 2.0 legislation on low to moderate-income employees. Commonwealth worked with five focus groups, for a total of 20 participants, to assess interest and requests for emergency expense provisions under SECURE 2.0. Under SECURE 2.0, employers can implement a PLESA feature that would allow employees to make post-tax contributions towards a rainy-day fund, which can be used during financial hardships. Source: 401kspecialistmag.com, April 2024
401k Benefits Undervalued by EmployersRather than turning to unlimited PTO policies or features dedicated to employee communications, a report by Guideline urges plan sponsors to look deeper within the workplace plans, and potentially the 401k. Their survey found that while employers and employees both agree that retirement benefits are valuable, some companies underestimate their value in attracting and recruiting employees. Source: 401kspecialistmag.com, April 2024
New Wave of Annuities in TDFs: "It's Complicated"A new wave of target-date funds featuring annuities is here, and the question of whether this combination has the potential to be the "easy button" for retirement income is explored in new research from Morningstar. Source: 401kspecialistmag.com, April 2024
Nearly 2 in 3 Americans Worry More About Running Out of Money Than DeathNearly two in three Americans say they worry more about running out of money than death with concerns about inflation, Social Security, and taxes contributing to the fear, according to the 2024 Annual Retirement Study from Allianz Life. The worry of running out of money has increased in recent years. In 2024, 63% say they worry more about running out of money than death, up from 57% in 2022. Gen Xers are the most likely to say this with 71% more worried about running out of money than death, compared to 64% of millennials and 53% of boomers. Source: Allianzlife.com, April 2024
401k Balances Rise 14% in 2023, but Participation Rate FallsAverage 401k account balances at plans recordkept by T.Rowe Price increased by 14% over the past year to $115,000, according to the Baltimore-based company's annual benchmarking report on 401k plan design and participant behavior. Source: 401kspecialistmag.com, April 2024
Americans Believe They Will Need $1.46 Million to Retire Comfortably According: StudyAmericans' "magic number" for retirement is surging to an all-time high, rising much faster than the rate of inflation while swelling more than 50% since the onset of the pandemic. These are the latest top-level findings from Northwestern Mutual's 2024 Planning & Progress Study, the company's proprietary research series that explores Americans' attitudes, behaviors, and perspectives across a broad set of issues impacting their long-term financial security. Source: Prnewswire.com, April 2024
Majority of Plan Sponsors Concerned Future Retirees Will Run Out of Money in RetirementIn 2024, more Americans are reaching the traditional retirement age of 65 in the same year than at any time in history, creating more than 4 million potential new retirees this year alone. While the U.S. faces this significant milestone, findings from a recent MetLife poll show a vast majority (91%) of plan sponsors are concerned that their future retirees will run out of money in retirement. When asked about what percentage of future retirees will run out of money in retirement, 83% of plan sponsors believe more than 1 in 4 retirees will deplete their retirement savings prematurely. Source: Metlife.com, March 2024
ESG in 401k Plans in the Wake of Spence v. American Airlines, Inc.Whether investment decisions for pension, 401k, and other plans covered by ERISA should be influenced by environmental, social, and governance factors has become a flashpoint, and, unlike most ERISA issues, the controversy extends into the political arena. The recent opinion of a federal district court denying a motion to dismiss claims that ESG factors were improperly applied for 401k plan investments shows that ESG can bring risk to fiduciaries, even if they are not pursuing ESG strategies. Source: Ktslaw.com, March 2024
Action Steps an Employer Can Take to Support Gen Z in SavingGeneration Z is looking ahead and shows a healthy regard and respect for their financial future, long-term. Studies show that they have a strong interest in financial literacy, saving, and employer-provided retirement benefits. Members of Gen Z also expect to spend 30 years in retirement, according to the Transamerica Institute. At the same time, Transamerica also says that a majority -- 57% -- of the members of Gen Z they studied agree that they need to save more for retirement. So what should employers do with that information? Source: Ntsa-net.org, March 2024
Small Business Retirement Plans: How Firms Perceive Benefits and CostsAt any given time, only about half of U.S. private sector workers are covered by an employer-sponsored retirement plan, and few workers save without one. The coverage gap, which undermines the retirement security of the nation's workers, is driven by a lack of coverage among small employers. This article presents the results of a new survey of small employers to understand why some offer retirement plans and others do not. Source: Bc.edu, March 2024
Help Employees Guard Retirement Savings Against Market VolatilityA recent survey revealed that 86% of employees feel increasingly stressed about their finances and nearly 50% worry about not having enough saved for retirement. Workers who frequently fret about covering unexpected car or home repairs, paying off student loans or credit card debt, or saving for retirement may have their financial worries compounded by the market's current volatility. Employers can play an important role in alleviating some of that financial stress by adopting investment strategies for the organization's retirement plan and helping employees reduce the impact of market volatility on their retirement savings. Source: Usicg.com, March 2024
Core Menus Need to EvolveThe role of the core investment menu in defined contribution plans has changed considerably over the last decade, as qualified default investment alternatives, particularly target-date funds, now capture more plan sponsor attention and participant assets than ever. This evolution requires plan sponsors and consultants to revisit key assumptions about optimal core menu design, especially as plan sponsors increasingly seek to retain participant assets during retirement, since older participants are more likely to use the core menu and invest conservatively. Source: Planadviser.com, March 2024
How Men and Women Invest Differently, and What We Can Learn From Each OtherStudies have shown that men and women have different approaches to investing money that can impact their long-term results. This 14-page paper looks at what those differences are, how they affect a portfolio, and what investors can do to gain balance in their investment style and strategy. Source: Arnerichmassena.com, March 2024
Millennials Redefine Retirement as "Financial Independence"Millennials are "redefining" what retirement means, according to a new survey conducted by IRALogix. More than half believe retirement is defined not by age 65 but by "financial independence." While some Millennials said ceasing all work by age 65 is a goal they are highly focused on working toward, many said they view retirement not necessarily as a complete exit from the workforce, but rather as a "time of greater flexibility in their lives." Source: Planadviser.com, March 2024
An Easy Read on the Past and Future of 401k Plan LitigationThere is a story in Plan Adviser on the past and future of ERISA litigation over 401k plans. It's a fun and short read, neither of which is normally true of articles on this subject. That's a little tongue-in-cheek, but that phenomenon is nobody's fault. At its core, the article presents the question of whether the long and highly contentious history of this area of litigation has actually benefited participants. There are three points from the Plan Adviser article that the author touches on here. Source: Bostonerisalaw.com, March 2024
Redefining 401k Data Collection for Racial and Gender GroupsA new study released today is shifting the way participant data is collected across the retirement planning industry. The research highlights gender and race-focused defined contribution administrative data typically found in human resource systems, with the hopes of combining it with qualitative research to better assess wellness platforms and tools for employers and participants. According to the research, data on nonwhite households remains relatively small with limited information on contributions, loans, and withdrawal and asset allocation activity. Source: 401kspecialistmag.com, March 2024
401k World: The LitigatorsThe era of plan litigation began, from the plaintiffs' view, seeking to protect workers from retirement plan negligence. From the position of many plan fiduciaries and their defense attorneys, the trend has spurred a host of copy-cat complaints aiming to wring settlements from large plan sponsors and providers. Whichever side is more accurate at any given moment -- or if it's some combination of both -- one thing is certain: DC litigation remains relatively robust. This PLANADVISER In-Depth story considers 401k litigation's present and future. Source: Planadviser.com, March 2024
Americans Want Retirement Investment Advice to Be in Their Best Interest: SurveyA new survey commissioned by the CFP Board reveals that nearly 97% of Americans agree that the financial professional who provides one-time recommendations or other one-time advice about retirement investments should be required to act in their client's best interest. This includes a recommendation to roll over funds from a workplace retirement savings program into an IRA or an annuity. Source: Prnewswire.com, March 2024
Beware of the Dark Side of the 401k BusinessLike Gotham in the Batman comics, there is an ugly underbelly to New York City. The same can be said of the retirement plan business, there is a dark side and this article will highlight some of the bad in the business that you should avoid if you are a plan sponsor. Source: Jdsupra.com, March 2024 | |||
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