[Guidance Overview]
PBGC Issues Final Regs on Reportable Events
"[1] Changes to Safe Harbors Based on Financial Soundness: ... The low-default-risk safe harbor ... The well-funded plan safe harbor ... [2] Other Changes to Waiver Provisions Under Final Regulations: Public company waiver ... Controlled group situations ... Small-plan waivers ... [3] Other Changes Under Final Regulations: Active-participant reductions ... Failure to make required minimum funding payments ... Inability to pay benefits when due ... Form 200 reporting."
(McGuireWoods LLP)
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Some Funds in Your 401(k) Aren't Really Mutual Funds After All
"[Collective investment trusts] look and act a lot like mutual funds, but generally have lower fees and disclose less about their inner workings to 401(k) participants.... [S]uch investments currently account for $2.4 trillion, or 16%, of the $15 trillion in 401(k)-style and pension plans, up from $1.3 trillion (and 12.7% of the total) in 2009 ... The trusts are accounts available only to retirement plans. They are sponsored by banks and trust companies and are primarily overseen by banking regulators, rather than subject to mutual-fund rules enforced by the [SEC]."
(The Wall Street Journal; subscription may be required)
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Many Would Put Off Retirement to Help Pay For College
"Nearly one-third of Americans would be willing to defer their retirements to help their children or grandchildren pay for college educations ... The report also confirmed what previous research has found: those saving for retirement are also the most likely to save for purposes other than retirement."
(LIMRA Secured Retirement Institute)
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Will Millennials Ever Be Able to Retire?
22 pages. "60% of Millennials think it is harder to plan for retirement than to stick with a diet and exercise plan.... Only 29% of Millennials in the study describe themselves as actively preparing for retirement. In fact, 15% of Millennials list winning the lottery as part of their retirement strategy, and 11% expect to be gifted money for retirement.... 65% of Millennials in the United States believe Social Security will provide them with no meaningful income in retirement."
(Insured Retirement Institute [IRI] and The Center for Generational Kinetics)
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Pension Plans and Interest Rates, Revisited
"[F]or an investor who has taken a position on rising interest rates, it is not the rise (or fall) in rates that determines whether they make a profit: rather, it is the rise (or fall) relative to the change that the market had priced in."
(Russell Investments)
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Retirement Assets Total $24.8 Trillion in Second Quarter 2015
"The new estimate of $24.8 trillion for March reflects a slight downward revision based on new information. Retirement assets accounted for 36 percent of all household financial assets in the United States at the end of the second quarter of 2015."
(Investment Company Institute [ICI])
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Inside Perspective on the Transamerica-Mercer Deal
"A deal announced [Sept. 25] to transition Mercer's defined contribution (DC) plan administration business to Transamerica's retirement platform will drive the migration of more than 900,000 participants and adds further momentum to a streak of recordkeeper consolidations.... [Sandy McCarthy, Mercer U.S. benefits administration leader, said:] 'We see both sides of the agreement playing out quite nicely. We will continue to invest in our defined benefit [DB] administration and in our health benefit administration business, while Transamerica will continue its own fantastic investment on the DC admin side.' "
(PLANSPONSOR)
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Projected 2016 Retirement Plan Contribution Limits
"The IRS generally announces any CPI increase around the third week of October. Based on current CPI information, we do not expect any increase in the 2016 contributions limits."
(401kHelpCenter.com)
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Another Look at Deferral of Commencement of Social Security Benefits
"[D]eferral is not necessarily a 'no-brainer.' The effectiveness of the deferral strategy depends on a number of considerations, including: [1] how long you will live, [2] how much savings you will use to 'bridge' the period of deferral, [3] what investment return you could earn on your savings and [4] the rate of future inflation."
(Ken Steiner, FSA Retired)
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Labor Market Shocks and Early Social Security Benefit Claiming
"[L]abor market shocks lead to current and future increases in the fraction of insured workers who initiate Social Security benefits at the earliest possible claiming age. Moreover, once they initiate benefits, early claimants continue to have low levels of earnings in all subsequent years."
(University of Michigan Retirement Research Center)
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California Bill Would Exempt Some Public Employees from Paying for Pensions
"A bill sent to Gov. Brown this month would exempt new hires from his reform requiring them to pay half the normal cost of their pensions, if they work for any of the 22 cities and one county that have special property taxes to pay pensions. The pursuit of an unlikely exemption may be an early sign of the resistance facing government employers that try to impose the 50 percent normal cost share on current workers, as allowed by the reform through the bargaining process beginning in 2018."
(Calpensions)
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[Opinion]
SPARK Supplemental Comment Letter to EBSA on Fiduciary Proposal (PDF)
"Descriptions of an investment's or distribution option's characteristics, including the pros and cons of selecting that investment or distribution option, should be included within the investment education carve-out.... It is critical that the Department allow existing clients to be grandfathered under current rules, particularly if the Department does not provide for a transition period of at least thirty-six months.... We remain concerned about the Department's adoption of FINRA's definition of 'recommendation,' especially if the Department incorporates the entire FINRA rule and accompanying guidance ... It is appropriate to expand the platform provider carve-out to IRAs because the carve-out only provides relief for marketing a platform of investments."
(The SPARK Institute)
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[Opinion]
American Academy of Actuaries Comment Letter to PBGC on Proposed Regs for Annual Financial and Actuarial Information Reporting (PDF)
"[A] higher participant threshold, such as 2,500, would better balance the need for additional information with the cost of providing that information.... Even with a higher threshold on the participant count, the committee does not believe that the $15 million underfunding threshold should be completely eliminated for larger plans.... We suggest that Section 4010 reporting be waived for companies that meet the low-default-risk safe harbor, or alternatively allow the continued use of the $15 million waiver threshold on a stabilized basis for companies that meet the safe harbor."
(American Academy of Actuaries)
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Benefits in General; Executive Compensation
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Access to Specific Provisions of Employer-Provided Benefits: New Estimates
"[This] article describes the prevalence with which people working for private employers in the United States are given the opportunity to enroll in health and retirement plans with various provisions -- the extent to which they have access to those provisions.... The analysis that follows explores this dynamic by presenting participation and takeup rates for plan provisions alongside the access rates."
(U.S. Bureau of Labor Statistics [BLS])
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Health Status of Older U.S. Workers and Nonworkers, National Health Interview Survey, 1997-2011
"Many U.S. workers are increasingly delaying retirement from work, which [we theorized] may be leading to an increase in chronic disease at the workplace.... [But we found that employed older adults] had better health outcomes than unemployed older adults.... A strong association exists between employment and health status in older adults beyond what can be explained by socioeconomic factors (e.g., education, income) or health behaviors (e.g., smoking)."
(Preventing Chronic Disease, via Centers for Disease Control and Prevention)
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Press Releases
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