Nevin's Data "Points"

Looks like the pension crisis is finally over. Well, the funding part of the crisis, anyway. No fewer than three separate studies * were published this past week that essentially said that the pension plans of larger employers are either fully or nearly fully funded again. For several years now, we’ve been struggling with the impact of the so-called “perfect storm” on pension plans. The catchy nomenclature was borrowed from the 2000 film by the same name (which, in turn, was pulled from the 1997 book on which it was based)—a reference to the 1991 Halloween Nor’easter that resulted from the unusual combination of several forces of nature to create an exceptionally powerful storm across a very large area. A storm—nearly a hurricane—that caught many off-guard. The so-called perfect storm for pension plans also resulted from an unusual confluence of factors—a slumping investment market, the “vacation” from funding that many plans took during a period when soaring investment returns ...

This past week, we passed the “anniversary” of the commencement of bombing strikes in Operation Desert Storm (1991). Now, I was too old—and my kids too young—to have been directly impacted by that action. But I’ll always remember that night. I was living in North Carolina at the time, and had been invited by a co-worker to my first NCAA basketball game at the “Dean Dome” at the University of North Carolina. Tickets had been hard to come by, and Chapel Hill was a nearly three-hour drive from where I lived (and on a “school” night, to boot)—but I was excited at the prospect. My friend and I got there early—grabbed some refreshments, found our seats, and sat down to watch the warm-ups. We were only about 10 minutes to tip-off when they made the announcement about Desert Storm—and the resulting decision to cancel the game. Now, unless it is a playoff game, or a remarkably close contest, people have a tendency to exit such events early to “beat the rush.” In this case—and I don’t know...

A couple of weeks ago, we got a panicked call from daughter No. 1, who had, on her way home from work, gotten her first flat tire. Now, flat tires are never fun, but she was clearly unnerved. It was after dark, at the end of a full day of work for her, and even though she was less than two miles from home, and we have motor club coverage, her mother and I piled into a car to change the tire. Whilst I was attending to the changing of the tire, my wife turned her attention to gaining a better understanding of the events that had led up to the event. I thought that was odd at the time—after all, tires run over objects and go flat all the time. But gradually, and painfully, my wife—who has a mother’s knack for discerning when the kids are being less than forthcoming—wrested the truth. It turns out that daughter No. 1, in her 10-minute drive home, had been adjusting the car radio—took her eyes off the road—and struck a curb at just the right angle. Sure, the tire going flat had been u...

I’ve been in this business since before I graduated college (and that’s now been a while) – but my first interaction with a financial adviser didn’t happen until I got to PLANSPONSOR magazine. Well, sort of. It would be more accurate to say that it was my first opportunity to have an interaction. Like too many plan sponsors out there, we had years earlier been sold the 401(k) by an adviser who, at some point not too long after the sale, went “missing.” In the real world, employers – even employers that cover the retirement plan industry – have a business to run. Running the retirement plan, as important as it is, generally isn’t part of that business. That’s why, particularly for smaller employers – but increasingly for employers of all sizes – a financial adviser can be such an important addition to the “team.” That realization has been a growing component of our focus here the past several years. It was part of our decision to launch AdvisorDash in 2003, an integral aspect of the la...