Administration November 13, 2013

Best Funded Pensions Allocate Less to Equity

November 13, 2013 (PLANSPONSOR.com) – Defined benefit pension plans that are less funded invest more aggressively, according to an analysis by Towers Watson.
Reported by

The analysis found plans that were less than 70% funded were relatively more aggressive investors, generally allocating more to public equities (50.4%) and less to debt (36%). Plans whose funded status exceeded 90% invested somewhat more conservatively, allocating more than any other group to debt (46.3%), and only 42.3% to public equity.

Allocations to debt investments grew steadily higher as funded status increased. The best funded plans in the analysis also had higher allocations to real estate and private equity than the least funded plans. Plans less than 70% funded allocated 1.7% of their portfolios to real estate investments and 1.9% to private equity investments, compared to 2.1% and 2.3%, respectively, for plans with a funded status of 90% or above.

Get more!  Sign up for PLANSPONSOR newsletters.

The analysis also found equity allocations declined as plan size increased and averaged 43.8% for the largest plans versus 50.3% for the smallest.

Towers Watson looked at pension allocations on both an aggregate- and average-sponsor basis as well as by plan size, funded status and other measures. More information is here.

Products November 13, 2013

Sunwest, TAG Partner on Fiduciary Service

November 13, 2013 (PLANSPONSOR.com) – Two firms are collaborating to provide retirement plan sponsors with third-party administrator (TPA) services.
Reported by

Together, Sunwest Pensions and TAG Resources LLC will provide plan document services, compliance testing, participant distribution, loan processing and Form 5500 preparation. In addition, Sunwest will offer payroll remittance services supporting plan sponsors.

TAG will assume liability in running the day-to-day administration of clients’ retirement plans under the service arrangement, according to a joint statement from the companies. In its fiduciary capacity, TAG will review plan fees and expenses, monitor plan providers, maintain discretionary authority and control of daily management, and perform the role of trustee in signing Form 5500 as a plan administrator.

For more stories like this, sign up for the PLANSPONSOR NEWSDash daily newsletter.

The firm will also be accountable for interpretation of plan documents and timely reporting to both plan participants and government oversight agencies.

Sunwest Pensions is a Phoenix-based third-party administrative firm specializing in consulting and administration of retirement plans. TAG Resources LLC is a retirement service company based in Knoxville, Tennessee. More information on the services is available on the firms’ websites.

«