Nevin's Data "Points"

Are employers necessary for a successful retirement system? A new proposal suggests that their role be “jettisoned.” Not one to simply “bash” the 401(k), and to his credit, Morningstar’s John Rekenthaler, who recently opined  that the 401(k) had outlived its usefulness, [i]  now offers an alternative that he considers to be a superior alternative, something he titles “the New American Retirement Plan.” Despite the shortfalls his previous column attributed to the 401(k), this proposal  in most of its elements seems relatively modest, at least structurally. It’s (basically – in 25 words or less), a national DC plan for all employers, probably with mandatory employee contributions, no requirement for employer contributions, and tighter restrictions on withdrawals. [ii] Make no mistake, though – the devil, and there’s mischief aplenty here – lies in the details. Rekenthaler’s basic premise – one that he describes not only as “the first,” but the “most important” step – i

That’s the premise behind a recent column by Morningstar’s John Rekenthaler, who writes that “the plans are as good as they can be under the current framework – and that's not good enough.” I had the pleasure of meeting John a number of years back – and I’ve been keeping up with his writing ever since. His columns are thoughtful and thought-provoking, his perspectives rational and well-reasoned, his commentary nearly always not only interesting, but entertaining. But on this one  – well, let’s just say we disagree. John acknowledges that his views on the 401(k) have “evolved,” and that while he has long been in the camp that called for improvements in the current system, a “defender” of the 401(k) – but now, apparently, he’s calling for an “overhaul.” ‘Leaky’ Assumptions He doesn’t fault the current system for its perceived shortcomings; he notes that the 401(k) wasn’t designed to be a solution for the general public’s retirement, saw the growth in the 1980s

The Plan Sponsor Council of America recently released its 62nd   Annual Survey of Profit-Sharing and 401(k) Plans ,  documenting a record high rate of savings, alongside an uptick in Roth contributions and other trends. However, sometimes the things that  don’t  change can be just as telling… Target-date trends (still) dominate, but…  Let’s face it – target-date funds are one of the most common items on a plan investment menu today ( the PSCA survey  noted that it’s the option in which assets are most frequently invested) and – in no small part due to their prevalence as a default investment alternative – continue to garner a lion’s share of new contribution dollars, if older savers (perhaps more precisely, longer-tenured savers) haven’t embraced (or more accurately, been defaulted into) the option with as much enthusiasm. That said, while more than two-thirds (68.6%) of respondents offer a target-date fund option, that’s actually down 5% in the past two years. Interes

It is something of a tradition this time of year to look back, to reminisce about past events and lessons learned, and sometimes to look ahead – and who am I to buck that trend? Here’s a look back – and some “things” that I hope will help lay the groundwork for a productive and prosperous 2020 for both you, and those you serve. ‘THINGS’ FOR PLAN FIDUCIARIES 7 Smart Shopping Steps to Avoid Buyer’s Remorse Shopping for a new provider is not something one would normally equate with a Black Friday foray or a Cyber Week scramble. But if you have a plan sponsor – or plan sponsor prospect – who’s thinking about shopping for a new provider, here are some ideas to share. 6 Things That Scare Plan Fiduciaries Halloween is the time of year when one’s thoughts turn to trick-or-treat, ghosts and goblins, and things that go bump in the night. But what keeps – or should keep – plan fiduciaries up at night? Well, there are the things like … 5 Things Plan Sponsors (Stil