| Benefits & Administration | Affluent May Need Savings Other Than Employer Plan | A recent Legg Mason survey finds affluent U.S.
investors predict their average net retirement expenses could top $2.5 million
without significant lifestyle changes. Legg Mason finds its sample has an
average retirement plan savings of $385,000 and is close to age 58. Seventy
percent of respondents said they had a defined contribution plan holding
substantial portions of their net savings, Legg Mason says. “Given their
ambitious goals, investors hopefully have considerable savings elsewhere, such
as significant equity in their home or other investment accounts, where their
asset allocation is designed to help them achieve their long-term goals,” says
Matthew Schiffman, global head of marketing for Legg Mason.Read more > | U.S. Representative Bruce Westerman, R-Arkansas,
introduced legislation (H.R. 1230) that would adjust the calculation of federal
civilian pensions. “This bill would simply change the formula for determining
pension benefits for civilian federal employees from the best-earning three
years to the best-earning five years of service,” Westerman says. “The bill
ensures that the program employees of the federal government have paid into for
their careers is available in retirement and sustainable for future
generations.”Read more > | Captive Arrangements Can Rein in Health Benefit Costs | “If you look at some of the biggest players—oil
and gas, or energy—the business model is focused on assuming risk,” notes Gerry
Winters, senior international consultant at Towers Watson. Rising health care
costs are an unmistakable pattern, Winters says, which have emerged as a
significant risk, especially in the last seven to eight years. One way to rein
in long-term costs is by assuming the insurance risk by setting up an in-house
insurance program, called a captive arrangement. Originally the arrangement—in
which a firm establishes its own insurance program—was just for
property/casualty insurance, but in the last 15 years, firms have been starting
to look at captives for health benefits.Read more > |
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| Products, Deals & People | Sibson Offers DC Plan Scorecard | Sibson Consulting has created a DC Plan
Scorecard that provides a framework for reviewing all aspects of defined
contribution (DC) plans. The Scorecard is a tool for identifying which
measurements to use for a particular plan because it requires selecting a level
of importance for each metric according to a five-point scale. Sibson’s DC plan
experts work with organizations and their retirement committees to help
determine which metrics are most important for a given plan. Individual
committee members likely prioritize these metrics differently and the Scorecard
helps to align the fiduciary committee as a whole.Read more > | | Sponsored message from Principal | FREE WEBCAST Sponsored by: Principal Financial Group “Building Retirement Plans That Work” Learn how you can help drive improved outcomes for retirement plan participants. Today. Tuesday, March 10 – 2:00 – 3:00 PM EST. Register now:Read more > | | Market Mirror | Yesterday,
the Dow climbed 138.94 points (0.78%) to 17,995.72, the NASDAQ was up 15.07
points (0.31%) at 4,942.44, and the S&P 500 closed 8.17 points (0.39%)
higher at 2,079.43. The Russell 2000 gained 6.07 points (0.50%) to finish at
1,223.59, and the Wilshire 5000 increased 74.26 points (0.34%) to 21,960.69.
On the NYSE,
3.2 billion shares traded, with a slight lead for advancers. On the NASDAQ, 2.8
billion shares changed hands, with 1.2 advancing issues for every declining
issue.
The price of the 10-year Treasury note was up 16/32,
bringing its yield down to 2.188%. The price of the 30-year Treasury bond
increased 31/32, decreasing its yield to 2.793%.
| | Compliance | The Department of Labor’s (DOL) Employee
Benefits Security Administration is holding a Voluntary Fiduciary Correction
Program in March. Attendees will receive instructions about how to make
corrections and use the Voluntary Fiduciary Correction Program (VFCP).Read more > | | From the Magazine | Drawing Down | Defined benefit (DB) plans never had a bad value
proposition. Rather, the move toward defined contribution (DC) plans resulted from
onerous regulations and increased costs, contends Bob Melia, vice president of
product strategy for Lincoln Financial Group’s retirement plan services
business in Radnor, Pennsylvania. Evidence of the original plans’ advantages
can be seen in the adoption of more DB-like features—such as automatic
enrollment and “do-it-for-me” investing solutions—in the defined contribution
marketplace. Along with these features, defined benefit plans offer systematic
and guaranteed withdrawals after retirement—something defined contribution
plans have begun to explore, as well. “It makes sense for plan sponsors to
offer a variety of withdrawal options within plans, and we’re seeing sponsors
more open to that,” Melia says.Read more > | | Investing | Is Glide Path-Investing Right for Everyone? | Ralph Segall, chief investment officer at
investment management firm Segall Bryant & Hamill, admits target-date funds
(TDFs) have been a helpful retirement industry innovation for the average,
unengaged retirement saver in a defined contribution plan. However, more
affluent investors are not necessarily best served by the prepackaged
strategies, he says, which generally assume the individual plans to spend all
assets prior to death and must limit risk as much as possible as one surpasses
the retirement date.Read more > | | Small Talk | ON
THIS DATE: In 1864,
President Abraham Lincoln signed a document officially promoting then-Major
General Ulysses S. Grant to the rank of lieutenant general of the U.S. Army,
tasking the future president with the job of leading all Union troops against
the Confederate Army. In 1876,
Alexander Graham Bell made the first successful call with the telephone. He
spoke the words “Mr. Watson, come here, I want to see you.” In 1926, “Lolly Willowes,” or “The Loving
Huntsman,” the first Book-of-the-Month Club selection, written by English
novelist Sylvia Townsend Warner, was published. In 1969, James Earl Ray pleaded guilty to the assassination of Dr.
Martin Luther King, Jr. and was sentenced to 99 years in prison. In 1988, disco sensation Andy Gibb died
from an inflammatory heart virus at the age of 30.
TUESDAY
TRIVIA: Margaret Hamilton, who played the Wicked Witch
of the West in The Wizard of Oz, was a kindergarten teacher before turning to
acting.
| TRIVIAL PURSUITS: You
may know that America gets its name from Italian merchant Amerigo Vespucci, but
do you know why it was named after someone who had nothing to do with its
discovery or settlement?Read more > | Share the good news with a friend! Pass the Dash along – and tell your
friends/associates they can sign up for their own copy.Read more > | News from PLANSPONSOR.com
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