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Reimagining the Participant Experience for a Digital World

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

Open 401k MEPs: Not Just for Smaller, "Planless" Employers

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

Fees for Large and Small 401k Plans Continue to Fall

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

We Want Help With College Loans, Not 401ks, Workers Say

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

Employers Build on Impact of Automatic Savings Features

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

Retirement Account Balances at Record Levels

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

New Retirement Mindset Driving Savings Behavior

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

From Traditional to Transitional: How the Nation's Retirement Model Is Changing

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

Most Americans Probably Wouldn't Save Without a 401k, ICI Finds

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

Retirement Industry Poised for "Meaningful Change" in 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

Retirement Outlook 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

Rethink, Rewire, Retire, White Paper

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 Savers Have New View on Retirement; Survey

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

Is the Adoption of Innovative Plan Features Finally Leveling Off?

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

Millennial Retirement Report: Time Is on Their Side, but the Clock Is Ticking

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

What Will DC Plans Look Like in 2025?

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

DC Trends Survey Highlights Plans' Focus for 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

Six Key Industry Trends to Watch

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

401k Participants Demonstrate Commitment to Retirement Saving

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

How Did the Average 401k Fare in 2019?

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

What if OregonSaves Went National: A Look at the Impact on Retirement Income Adequacy

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

Transamerica Retirement Survey: A Compendium of Findings About U.S. Workers

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 Participants' Activities, First Half 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

2020 403b Plan Priorities

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

Deloitte Defined Contribution Benchmarking Survey

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 State Retirement Savings: How the Shift to 401ks Has Increased Gaps in Retirement Preparedness

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

Is Your Defined Contribution Plan Ready for 2020?

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

Default Electronic Delivery Works, White Paper

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

Self-Directed 401k Millennial Investors Favor ETFs, Cash

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 Embrace New Hardship Withdrawal Rules, PSCA Finds

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

Is Auto-Enrollment Helping or Hurting Long-Term Retirement Saving?

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

The Final Frontier: Adding a Retirement Tier

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

Retirement Plan Sponsors Need Strong Cybersecurity Defenses

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

Is Mandatory Individual Arbitration Another Tool for the Plan Design Toolbox?

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

Some 401k Participants May Be Exposed to Unnecessary Risk

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

The Evolution of Retirement Savings to Retirement Income

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

Facts About Women's Retirement Outlook

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

401k Balances are Far Below Potential

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

How Would 401k "Rothification" Alter Saving, Retirement Security, and Inequality?

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

The Over-Stated Retirement Crisis

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

In-Plan Guaranteed Income Will Always Be a Challenge

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

Evaluating the Impact of Mergers and Acquisitions on the Employee Benefit Plans

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

Income Reimagined: Expanding DC From Saving to Spending

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

How to Build (and Judge) a Successful 401k Plan: Case Study

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

2019 Participant Survey

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

What a New Survey Reveals About ESG Adoption

Callan recently released its 2019 ESG Survey. Here are the key takeaways, analysis, and commentary.

Source: Fiduciarygovernanceblog.com, October 2019

Current Trends in Retirement Income Planning

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

403bs Boost Participation, Contributions, Financial Wellness

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

DC Plan Participants Want Certainty and Control

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

Retirement Pulse: Three Questions Today, an Improved DC Plan Tomorrow

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

Will 2019 Be the Year of the Multiple Employer Plan (MEP)?

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

Canadians Increasingly Putting Retirement Savings on Back Burner

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

2019 Regulatory Update

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

Understanding Behavior Biases Can Help Plan Sponsors With Investing Communications

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

Maximizing Plan Design to Drive Better Outcomes

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

A Prudent Approach to Evaluating Target-Date Funds

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

Could There Be Unintended Consequences to Putting Off Retirement?

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

Employee Agreements: A Method for Mitigating ERISA Fiduciary Exposure?

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

More Employers are Adopting Lifetime Income Solutions for DC Retirement Plans

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

Debt, Homeownership Driving Participants to Withdraw Retirement Funds

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

DC Plan Recordkeeper Data Show Ongoing Commitment to Retirement Saving

Americans continued to save for retirement through defined contribution plans early this year, according to an ICI study. 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. The latest recordkeeper data indicate that plan participants remain committed to saving and investing. Only 0.9 percent of DC plan participants stopped contributing to their plans in the first quarter of 2019.

Source: Ici.org, August 2019

Number of 401k Millionaires Hits Record High

Fidelity Investments said the number of retirement savers with at least $1 million in their account hit a record, as did the employee savings rate, according to data from 401k plans that it administers. The average employee contribution rate reached 8.8% in the second quarter, up a full percentage point from a decade ago, Fidelity said. The analysis is based on the 30 million retirement accounts the Boston-based money manager administers.

Source: Benefitnews.com, August 2019

Survey: Less Than a Third Have Increased Their Retirement Savings Rate This Year

Saving money can be tough, but working Americans appear to at least be holding their retirement contributions steady in 2019, even if many of them are not actually increasing their rate of savings. Fewer than one-third of working Americans (29 percent) have increased their retirement savings contribution rate compared to last year, according to Bankrate's August Financial Security Poll.

Source: Bankrate.com, August 2019

Auto Portability Preserves Retirement Savings, Study

A new Employee Benefit Research Institute study addresses the potential benefits of using auto portability for handling 401k accounts upon termination of employment. The study examines automatically taking a participant's account from a former employer's retirement plan and combining it with their active account in a new employer's plan. This would help keep the defined contribution assets in the retirement system and -- in theory -- reduce leakage from cashouts upon employment termination.

Source: Compliancedashboard.net, August 2019

What Is the Most Accurate Participation Rate for Retirement Plans?

A new study contends that American workers' participation in employer-sponsored retirement plans is significantly higher than suggested by the most commonly cited statistics. In fact, nearly two-thirds of workers between ages 26 and 64 participate in such plans, either directly or through a spouse, according to the Investment Company Institute. What's more, the participation rate rises to more than three-quarters if younger and lower-income workers -- those who are the least likely to be able to or want to save for retirement -- are excluded from the analysis.

Source: Asppa.org, August 2019

403b Plan Sponsors Reveal Investment Preferences in Survey

Sponsors of 403b plans are more concerned about market volatility than 401k plan sponsors, according to the 2019 BlackRock DC Pulse: 403b Report. Plan advisers can help 403b plan sponsors looking for downside protection, active strategies and target-date funds that can be used as a decumulation vehicle in retirement.

Source: Planadviser.com, August 2019

Three New Surveys Show How Student Loan Debt Is Crippling 401k Contributions

Student loan debt, that mortal enemy of retirement savings, is showing no signs of slowing its assault on workers ability to contribute (or contribute more) to their 401k. A trio of new surveys illustrate the hardships student loan debt is causing would-be retirement savers.

Source: 401kspecialistmag.com, August 2019

Retirement Plan Participation Continues to Increase

American workers' participation in employer-sponsored retirement plans is significantly higher than suggested by the most commonly cited statistics, with nearly two-thirds of workers between ages 26 and 64 participating in such plans, either directly or through a spouse, according to a new study by the Investment Company Institute.

Source: Ici.org, August 2019

IRI Research Demonstrates Need for Consumer Education on Retirement Security

Increasing the share of workers who participate in retirement plans has been a primary focus of retirement policy. As the retirement industry and policymakers try to increase participation, it is important to understand which workers currently participate in employer sponsored retirement plans and why certain employers offer, and certain employees desire, compensation in the form of retirement benefits. This 32-page report uses newly available data -- tabulations of administrative tax data published by the IRS Statistics of Income Division -- to analyze participation in employer-sponsored retirement plans.

Source: Myirionline.org, August 2019

Who Participates in Retirement Plans

Increasing the share of workers who participate in retirement plans has been a primary focus of retirement policy. As the retirement industry and policymakers try to increase participation, it is important to understand which workers currently participate in employer sponsored retirement plans and why certain employers offer, and certain employees desire, compensation in the form of retirement benefits. This 32-page report uses newly available data -- tabulations of administrative tax data published by the IRS Statistics of Income Division -- to analyze participation in employer-sponsored retirement plans.

Source: Ici.org, August 2019

Participants Need More Education About Distribution Options

Forty-two percent of those between the ages of 35 and 65 who left a job where they had money in a 401k plan were unaware that they could have left the money in the plan, and 28% didn't know that some retirement distribution choices trigger tax liabilities and penalties, a survey found.

Source: Plansponsor.com, August 2019

Average 401k Balance Continues to Build

According to estimates from the nonpartisan Employee Benefit Research Institute), the average 401k balance for those aged 25-34 with 1-4 years of tenure has gained rose another 2.5% in July, building on the 24.3% year-to-date gain registered at the end of Q2.

Source: Napa-net.org, August 2019

Hot Topics for 401k Plan Providers

The beauty of the retirement plan business is that it's constantly changing, the bad part of it is that it's constantly changing. As a plan provider, you always need to be on your toes because it's such a competitive marketplace that you can't afford to be asleep at the wheel. If you're not ahead of the curve, you will certainly be behind it and the history of this business is littered with plan providers who failed, just because they couldn't adapt to a changing environment. This article is about some of the hot topics that you should be aware of and using these topics for marketing help and to better focus your service.

Source: Jdsupra.com, August 2019

Open MEPs: A Promising Way to Narrow the Coverage Gap

Employers play a substantial role in helping employees prepare for retirement. Yet small businesses state that cost and other administrative concerns limit their ability to offer their employees access to a workplace retirement plan. Open multiple employer plans (MEPs) offer a solution, allowing small businesses to band together under one workplace plan.

Source: Empower-Retirement.com, July 2019

Open MEPs Seen as a Promising Way to Narrow the Coverage Gap

Two-thirds of small businesses that currently do not offer a retirement plan say that they would consider doing so through an open MEP, Empower learned in a survey.

Source: Planadviser.com, July 2019

The Self-Employed Are Defying Retirement While Overlooking Essential Preparations

Only 26 percent of the self-employed are "very much" looking forward to retirement according to findings from Self-Employed: Defying and Redefining Retirement, a new study released today by nonprofit Transamerica Center for Retirement Studies. The self-employed are enjoying life. Given the autonomy and flexibility in their work situations, the concept of retirement is less relevant to them and not necessarily something they aspire to. The survey of 755 respondents explores the retirement outlook of individuals who are primarily self-employed.

Source: Transamericacenter.org, July 2019

Reducing Regulatory Obstacles to Annuities in 401k Plans

Retirees with defined contribution plans face a key dilemma: how and when to convert their retirement savings into income in a way that minimizes the risk of outliving their assets without unnecessarily sacrificing their standard of living. Annuities offer one way to resolve this dilemma. This 41-page paper explores legislative and regulatory reforms that could encourage workers to annuitize more of their 401k and other defined contribution balances upon retirement. It proposes changes that would create an appropriately protective fiduciary safe harbor for plan sponsors selecting annuity providers, increase the portability of annuities, and reform the required minimum distribution rules relating to retirement income.

Source: Brookings.edu, July 2019

A Closer Look at Legislative Proposals Impacting Retirement

Although the question of whether a retirement "crisis" exists (and if so, to what extent) is still the subject of considerable debate, several legislative proposals have been recently introduced or reintroduced that could have a significant impact on retirement coverage as well as on the ability of individuals to manage important retirement-related risks. How much might some of the recent legislative proposals for expanding access to employer sponsored retirement plans improve retirement income adequacy for current workers? This paper examines this by simulating the impact of some of the more important aspects of current legislative proposals.

Source: Ssrn.com, July 2019

2019 Survey Reveals Most Popular Employee Benefits

Employers continue to place a lot of value in the employee benefits they offer their workforce, according the SHRM 2019 Employee Benefits Survey. SHRM conducts the survey annually to gather information on the types of benefits employers are offering their employees and to report on trends.

Source: Xperthr.com, July 2019

America's Retirement Crisis by the Numbers

These days, overwhelming student loan debt and the uncertain future of Social Security's solvency garner most of the attention, but there's another equally severe financial crisis looming on the horizon for millions of Americans. Thousands of people retire every day, and many don't have the savings they need to last the rest of their lives. It's a fate thousands of Americans are already experiencing, and based on data from the latest Northwestern Mutual Planning & Progress survey, tens of thousands more are set to join them in the coming decades.

Source: Fool.com, July 2019

Developing a Comprehensive National Retirement Policy

Although Americans often have disparate opinions on many issues, one issue that does enjoy widespread support is the importance of experiencing a dignified and financially secure retirement. Unfortunately, the debate on retirement security has not received the attention many think it deserves. Thus, despite some concern over a looming retirement crisis, significant thought has not been put into developing a comprehensive national retirement policy. This 16-page issue brief explores the concept of a national retirement policy, including the potential benefits of such a policy and the various topics that it might address.

Source: Actuary.org, July 2019

The Economics of Providing 401k Plans: Services, Fees, and Expenses, 2018

401k plan participants investing in mutual funds tend to hold lower-cost funds. At year-end 2018, 401k plan assets totaled $5.2 trillion, with 37 percent invested in equity mutual funds. In 2018, the average expense ratio for equity mutual funds offered in the United States was 1.26 percent. 401k plan participants who invested in equity mutual funds, however, paid about one-third of that amount -- 0.41 percent -- on average. The expense ratios that 401k plan participants incur for investing in mutual funds have declined substantially since 2000. This is a 34-page report.

Source: Ici.org, July 2019

Mutual Fund Expense Ratios in 401k Plans Have Trended Downward Since 2000

The cost of investing in equity and hybrid mutual funds through 401k plans fell again in 2018, while the average expense ratio of bond mutual funds remained stable, according to "The Economics of Providing 401k Plans: Services, Fees, and Expenses, 2018," a research report released by the Investment Company Institute. The report also shows that participants who invest in mutual funds in their 401k plans tend to hold lower-cost funds.

Source: Ici.org, July 2019

Retirement Assets Top $29 Trillion, While Plan Fees Continue Downward Trend

Since the end of last year, total U.S. retirement assets were up 7.4%, reaching $29.1 trillion at the end of the first quarter for 2019, according to new data by the Investment Company Institute. Retirement assets accounted for 33% of all household financial assets in the U.S. at the end of March 2019, with defined contribution plan assets reaching $8.2 trillion at the end of the first quarter, up 8.2% from year-end 2018. Of these DC plan assets, $5.7 trillion was held in 401k plans.

Source: Napa-net.org, June 2019

Baby Boomer Women Significantly Lag Baby Boomer Men In 401K Savings

Baby boomer women have a median 401k savings balance of $59,000, less than half of the $138,000, median balance of baby boomer men, according to a recent T. Rowe Price survey focused on the financial behavior and attitudes related to gender. This savings gap carries over to millennial women, who have a median 401k balance that is $30,000 less than the median balance of millennial men.

Source: Prnewswire.com, June 2019

Automatic Enrollment in 401k Annuities: Boosting Retiree Lifetime Income

Very few defined contribution retirement plans in the U.S. today pay out lifetime income streams, leaving retirees at risk to run out of money in old age. The authors of this paper propose to include deferred lifetime income annuities as a default in employer-provided 401k plans. They investigate the pros and cons of such a proposal using a life cycle economic model which takes into account the value of having true longevity protection in one's retirement account.

Source: Brookings.edu, June 2019

Data Show Diverse Range of 401k Investment Options

Employers offer a wide and diverse range of investment options to encourage their employees to contribute toward their retirement savings, according to an updated study on 401k data from BrightScope and the Investment Company Institute. The report revealed that in 2016 the average large 401k plan offered 27 investment options, including a mix of equity funds, bond funds, and target date funds. The study also found that employers often use simple matching formulas to encourage employee contributions and that plan fees continue to decline over time.

Source: Brightscope.com, June 2019

Index Fund Rise Coincides With 401k Suits

More 401k lawsuits were filed in 2016 and 2017 than during the 2008 financial crisis, and the steady drumbeat of litigation could be affecting how workers save and invest. For one thing, the suits have coincided with a dramatic increase in equity index funds, according to a report by the Center for Retirement Research. Last year, nearly one out of three U.S. stock funds were index funds, double the share 10 years ago.

Source: Bc.edu, June 2019

Building a Better 401k Plan Investment Lineup

A rash of 401k class-action lawsuits and low participation rates have revealed rifts between plan sponsor intentions, on the one hand, and participant perceptions of actual practices, on the other hand. Details about plan investment lineups often reside at the center of the controversy and confusion. This paper examines six items a plan sponsor might consider when building, maintaining, and altering the fund menu for its participants.

Source: Jhinvestments.com, June 2019

These Are the Best-Rated Workplace Retirement Plan Providers of 2019

If you have access to a workplace retirement plan like a 401k, consider yourself fortunate. If you have a workplace retirement plan provided by Charles Schwab, consider yourself even more fortunate. Workplace plan participants -- meaning employees themselves -- recently rated Charles Schwab the best provider in the J.D. Power 2019 Group Retirement Satisfaction Study. This study is in its second year, and Charles Schwab has earned the highest overall satisfaction rating both years.

Source: Yahoo.com, June 2019

How America Saves 2019

The 18th edition of "How America Saves" delivers a 121-page comprehensive analysis of the retirement savings behavior of 5 million participants in about 1,900 defined contribution retirement plans for which Vanguard provides recordkeeping services. Our data-rich report examines trends in how participants accumulate, manage, and access retirement savings.

Source: Vanguard.com, June 2019

America Has the Widest Retirement Savings Gap of These Developed Nations

Many Americans haven't saved as much money as they need for retirement, and the gap is expected to widen dramatically in the next 30 years. The retirement savings gap -- between what people have and should have -- was $28 trillion in the U.S. in 2015, but by 2050, it's expected to swell to $137 trillion, according to the World Economic Forum, a Cologny-Geneva, Switzerland-based nonprofit that researched international financial affairs.

Source: Marketwatch.com, June 2019

Top 401k Plans Ranked by Industry

New analysis from MONEY pegs top company retirement plans in 14 different industries and compares the average participant account balance to industry average 401k balance.

Source: 401kspecialistmag.com, June 2019

Average Employer 401k Match Revealed: How Generous -- or Stingy -- Is Your Company?

Is your company being stingy when it comes to supporting your future? If your employer is contributing less than 4.7 percent toward your 401k, then you have your answer. According to a new report from Fidelity, that's the average 401k match companies were handing out in the first quarter of 2019.That contribution rate, a record high, bumped the average total savings rate (employee contributions + company match) to an all-time high of 13.5 percent in the first quarter.

Source: Yahoo.com, June 2019

Student Loan Benefit Program

This white paper examines IRS Private Letter Ruling (PLR 201833012), issued May 22, 2018. In the PLR, the IRS ruled that a student loan repayment program included in an employer-sponsored 401k plan did not violate the "contingent benefit" prohibition. Under the program, employees received employer contributions that were conditioned on making student loan repayments in lieu of receiving regular matching contributions under the plan. Employers may want to adopt an SLR program in order to attract and retain employees with outstanding student loans, who may lack the funds to make 401k contributions and receive employer matching contributions.

Source: Newportgroup.com, May 2019

Retirement Plan Participants Stayed the Course Through Up and Down Markets in 2018

Almost all defined contribution (DC) plan participants kept contributing to their retirement savings during 2018, according to ICI's "Defined Contribution Plan Participants' Activities, 2018." 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 2019

What Age Should Retirement Be Planned To?

One of the big discussions in the profession is choosing the age retirement should be planned to. Should it be age 95? Age 100? Some other age? Here's a good brief discussion on the implications of choosing an age.

Source: Brightscope.com, May 2019

Participants' Satisfaction with Providers Continues to Decline

The National Association of Retirement Plan Participants (NARPP) has released its annual "Participant Trust & Engagement Study," which shows that overall satisfaction with providers has declined by 24 percentage points in the past six years to a new low. NARPP says that if retirement plan participants trusted their providers more, it would likely lead to higher deferral rates.

Source: Planadviser.com, May 2019

Investors Who Stayed the Course Rewarded With Significant Gains

Despite a rocky end to 2018 and predictions of an impending recession, those who stayed the course were rewarded with a generous first quarter rebound on the 10-year anniversary of the stock market low.

Source: Ntsa-net.org, May 2019

Defined Contribution Plans and the Challenge of Financial Illiteracy

Study analyzes data from the 2015 National Financial Capability Study to show that people whose only exposure to investment decisions is by virtue of their participation in an employer-sponsored 401k plan are poorly equipped to make sound investment decisions. This lack of financial literacy is critical both because of the financial consequences of poor financial decisions and because of a legal structure that relies on participant choice to limit the fiduciary obligations of the employer with respect to the structure and options provided by the retirement plan.

Source: Ssrn.com, May 2019

Callan Releases Study of Investment Manager-Sponsored 401k Plans

Callan announced the release of "The Cobbler's Shoes: How Asset Managers Run Their Own 401k Plans." The white paper explores what the investment management industry, the stewards tasked with managing the investments of 401k plans for others, do for their own employee base.

Source: Businesswire.com, May 2019

Sustainable Investing in Defined Contribution Plans

The recent series of bulletins on ESG-related investing issued by the DOL has led to confusion due to a lack of clarity in the language and an inconsistent tone over the course of different administrations. This 8-page paper seeks to provide plan sponsors with a base level of knowledge about sustainable investing and integration, by providing clarification on terminology and focusing on areas that historically have been misperceived.

Source: Dciia.org, May 2019


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