Nevin's Data "Points"

One could certainly argue that many Americans act as though at retirement some kind of benevolent elf will drop down their chimney with a bag full of cold cash from the North Pole. They behave as though, somehow, their bad savings behaviors throughout the year(s) notwithstanding, they’ll be able to pull the wool over the eyes of a myopic, portly gentleman in a red snowsuit. A few years back — well, now it’s quite a few years back — when my kids still believed in the reality of Santa Claus, we discovered an ingenious website that purported to offer a real-time assessment of their “naughty or nice” status. Now, as Christmas approached, it was not uncommon for us to caution our occasionally misbehaving brood that they had best be attentive to how those actions might be viewed by the big guy at the North Pole. But nothing we said ever had the impact of that website — if not on their behaviors (they were kids, after all), then certainly on the level of their concern about the conseq

I can remember as a kid paging through the pages of various Christmas catalogues, earmarking the pages that contained the various things that I hoped Santa Claus (or his emissaries, my parents) would take as hints. These days such things have been replaced by online “wish lists” – and if they’re not quite as much fun to page through, they’re doubtless more effective. So, in the spirit of the holiday season, here are some “presents” that I hope participants find in their retirement plan “stockings” during the coming year: Automatic reenrollment for longer-term workers. New hires, regardless of age, are these days routinely defaulted into some type of qualified default investment alternative, whether it be a managed account, target-date fund, or balanced fund. However, workers who have been in the plan for awhile are generally not accorded that courtesy. Rather, ostensibly on the premise that they have, at some previous point in their careers, made an affirmative election to be

To judge by the headlines, if there’s anybody in more trouble when it comes to retirement planning than Boomers, it’s Millennials. But are they really? Consider this: Millennials are saving for retirement – likely earlier, and at higher rates than you did when you were their age. I’ve seen a number of surveys that suggest that Millennials are, in fact, saving earlier – and saving at higher rates than their Boomer parents. A recent Natixis survey says that on average, Millennials first enrolled in a retirement savings plan at age 23, while Boomers didn’t until 31. Another – this one by Ramsey Solutions – finds 58% of Millennials are actively saving for retirement, and they began saving at an average age of 23. Consider also that, of the Millennials who are actively saving, 39% set aside up to 9% of their income for retirement — $5,000 of the average annual Millennial household income of $55,200. This higher and earlier rate of saving exists despite high levels of college debt

Target-date funds continue to expand in usage and popularity – but there are some things the Labor Department wants you to know about TDFs that you may have overlooked. When the Labor Department published its “ Target Date Retirement Funds – Tips for ERISA Plan Fiduciaries ” in 2013, I was pleased to see it, and to discover that it could be read 1 (and understood) in about 15 minutes. But in preparation for a recent webcast on the topic, I took a fresh look at that document, and found some nuggets that I hadn’t really picked up on the first time around. It’s Not Just About Fees and Performance As part of a reminder about the importance of establishing a process for comparing and selecting TDFs, the Labor Department specifically references considering prospectus information, such as information about performance (investment returns) as well as investment fees and expenses. However, in that same topic point, the agency says that plan fiduciaries should consider how well the TD