|
|
Employee Benefits Jobs
|
|
Webcasts and Conferences
|
|
Subscribe Now to This Newsletter (free)
We also
publish the BenefitsLink Health & Welfare Plans Newsletter (free):
Subscribe Now
|
|
[Official Guidance]
PBGC Premium Rates for 2016
"The per-participant flat premium rate for plan years beginning in 2016 is $64 for single-employer plans (up from a 2015 rate of $57) and $27 for multiemployer plans (up from a 2015 rate of $26). The increase in the single-employer rate was provided in The Bipartisan Budget Act of 2013. The increase in the multiemployer rate is the result of indexing.... For plan years beginning in 2016, the variable-rate premium (VRP) for single-employer plans is $30 per $1,000 of unfunded vested benefits (UVBs), up from a 2015 rate of $24. This $6 increase reflects a $5 increase provided in The Bipartisan Budget Act of 2013 plus a $1 increase due to indexing."
(Pension Benefit Guaranty Corporation [PBGC])
|
[Guidance Overview]
DOL Announces Guidance on Social Investments (PDF)
"The basic text of IB 15-01 is virtually identical to IB 94-01. But the DOL seems to have gone a bit further in the preamble. There, DOL expresses the view that ESG factors are not merely collateral considerations, but can be an integral part of the economic analysis performed by the plan fiduciary when considering an investment. The preamble to IB 2015-01 explains that plan fiduciaries may address ETIs or incorporate ESG factors in investment policy statements and utilize ESG-related tools, metrics, and analyses to evaluate investments."
(Groom Law Group)
|
[Guidance Overview]
DOL Liberalizes Rules for Economically Targeted Investments
"IB 15-01 reflects that the DOL of the Obama administration believes the DOL of the Bush administration went too far by suggesting that additional fiduciary processes are required before investing in an ETI.... IB 2015-1 does not greenlight ETIs.... But it does make clear that fiduciaries should not be at greater risk for investing in funds that are constructed by non-economic criteria when the fiduciary has determined the funds are prudent investments under economic criteria."
(Kilpatrick Townsend)
|
[Guidance Overview]
For Plan Investments in ETIs, the 'All Things Being Equal' Test Prevails Again
"This [article]: [1] Defines [economically targeted investments (ETIs)] and explains why they are relevant for ERISA-governed plans; [2] Explains the DOL's prior guidance on ETIs ... [3] Describes the DOL's position in IB 15-01; [4] Provides plan fiduciaries with practical tips on incorporating ETIs into their plan's investment portfolio."
(Practical Law Company)
|
|
|
[Guidance Overview]
PBGC Creates Reportable Event Waiver Structure
"Under the final rule, some reportable event waivers will be based on whether sponsors pose a risk of not being able to maintain their pension plan. This approach is a departure from the old regulation, which focused more heavily on plan funding levels. For post-event reporting, the new rules apply to events that occur on or after January 1, 2016. For advance reporting, the new rules apply to reports due on or after that date."
(Towers Watson)
|
Differences Between Women and Men in Retirement Plan Savings Behavior (PDF)
12 pages. "Women are 14% more likely to participate than men in their workplace savings plan and once enrolled save at higher rates than men at all income levels. Women and men take similar levels of portfolio risk, in part due to the growing use of target-date funds as defaults.... In the aggregate, men have account balances that are more than 50% larger than women. This difference reflects men's average wages, not superior retirement savings behavior.... The rising adoption of automatic enrollment is mitigating the differences in participation and saving rates between men and women."
(Vanguard)
|
The Pension Risk Transfer Market at $260 Billion (PDF)
16 pages. "[T]he U.S. still trails the U.K. with only $67 billion in transaction volume between 2007 and June 2015.... When we look at the U.K. today, we see the global future of pension de-risking and the shape of the risk transfer market to come to other countries. We see a line-up of flexible solutions designed to meet the needs of any company on a path to a lower risk future. In the U.K., where the risk transfer market is the most advanced, plan sponsors are making very personal decisions that are specific to their resources, constraints, objectives and definitions of success. These decisions lead to highly customized de-risking strategies that are rapidly going global."
(Prudential)
|
Long-Term Goals, Short-Term Pressure: Attitudes, Actions and Assessments of Defined Contribution Plan Participation (PDF)
24 pages. "Plan participants know they need to save, but many struggle to balance this long-term goal with meeting short-term financial pressures. For 25% of our survey population, the short term wins and they opt out of their retirement saving plan altogether.... While 64% say they save to ensure a secure retirement, most are not maximizing contributions, few take advantage of added incentives to increase account balances, and few actively manage their retirement savings."
(Natixis)
|
|
|
The Real Cost of Investment Fees (PDF)
23 pages. "Financial institutions charge a variety of fees associated with investment accounts, including account opening fees, service and maintenance fees, as well as trade fees. For the purpose of uncovering the true cost of fees on savings, this report will examine the combined impact of the two primary management fees: advisory fees and fund-related fees."
(Personal Capital)
|
Lawmakers Chafe at SEC's Slog Through Fiduciary Rule Process
"Backers of the DOL rule say opponents want the DOL to wait on the SEC because its slow-go approach would effectively kill the DOL measure. But those who want the SEC to go first say it makes more sense because an SEC regulation would apply to all securities investment accounts, not just those for retirement. The DOL rule also would cover insurance and other investments. 'It's absurd to have two sets of rules,' said Rep. Brad Sherman, D-Calif. 'It ought to be the same rule. The stricter rule ought to apply to non-IRA accounts.' "
(InvestmentNews)
|
Borzi: DOL Proposal Should Help States Avoid ERISA
"The proposal will include a provision allowing certain types of payroll deductions for automatic enrollment individual retirement accounts -- or a safe harbor -- that 'more directly addresses some of the issues the states have raised with us,' because the current safe harbor in DOL regulations calls into question some of the things states have been doing, [said Phyllis C. Borzi, assistant secretary for EBSA]."
(Bloomberg BNA)
|
Deferring Taxes Not Always Best Plan
"Most strategies focus on qualified accumulation, which defers income tax until the distribution phase when a person presumably has fewer exemptions and deductions. For high-income earners paying taxes at the highest levels during the accumulation phase, this is an advantage. For those at lower levels, income tax during the distribution phase can be challenging."
(InvestmentNews)
|
[Opinion]
'Yes' to Increasing the Social Security Retirement Age
"A major factor driving Social Security spending higher is that people are living longer, healthier lives. More people reach retirement age, and once they do, they live longer.... Yet, Social Security's eligibility age is slated to increase by only two years -- to age 67 -- and even that 'extended' age won't take effect until 2027. Life expectancy tables and fiscal prudence suggest that's simply not enough. Lawmakers should increase the Social Security retirement age, gradually and predictably, to reach 70 over the next two decades, and then index the age to life expectancy."
(Romina Boccia, via SouthCoast Today)
|
[Opinion]
AFL-CIO Letter to Representatives Urging Opposition to the Misnamed Retail Investor Protection Act
"H.R. 1090 would unnecessarily prevent the [DOL] from moving forward with its conflict of interest rulemaking to protect retirement savers until the [SEC] has finalized new rules covering the duties of brokers to their customers. In addition, the SEC would not be able to act until it complied with several new reporting and analysis requirements that would provide no meaningful benefit to investors and further delay any regulatory action.... A vote for this bill is a vote to obstruct important consumer protections for retirement investors and to weaken Americans' retirement security."
(AFL-CIO)
|
[Opinion]
Four Views on DB vs. DC Plans
"[The Economic Policy Institute] has gotten the math wrong by overestimating the retirement income from 401(k)s ... 401(k)s are not the solution to America's retirement crisis but neither is ... a government-mandated Guaranteed Retirement Account system which invests like U.S. pension funds getting eaten alive by hedge fund, private equity fund and real estate fund fees."
(Pension Pulse)
|
|
Press Releases
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Additional useful links:
BenefitsLink.com, Inc.
1298 Minnesota Avenue, Suite H
Winter Park, Florida 32789
Phone (407) 644-4146
Fax (407) 644-2151
Lois Baker, J.D., President
David Rhett Baker, J.D., Editor and Publisher
Holly Horton, Business Manager
Copyright 2015
BenefitsLink.com, Inc. — but feel free to forward this
newsletter without further permission from us, if you do not
modify the newsletter in any way (including this lower
portion).
All materials contained in this newsletter are
protected by United States copyright law and may not be
reproduced, distributed, transmitted, displayed,
published or broadcast without the prior written
permission of BenefitsLink.com, Inc., or in the case of
third party materials, the owner of that content. You
may not alter or remove any trademark, copyright or
other notice from copies of the content.
Links to websites other than those owned by
BenefitsLink.com, Inc. are offered as a service to
readers. The editorial staff of BenefitsLink.com, Inc.
was not involved in their production and is not
responsible for their content.
We are proud of our
Privacy Policy.
Thanks for reading this newsletter!
|
