3 Big Shortcomings of Target Date Funds
Asset growth in Target Date Funds (“TDFs”) in defined contribution plans has been phenomenal the past few years, primarily because the trend in plan design features such as automatic enrollment and being deemed qualified default investment alternatives. Respondents in a Callen Associates survey indicated that the total percentage of defined contribution plan assets in TDFs as of 12/31/2013 was 21.12%, […]
Time to Consider a Collective Trust?
A recent article in PLANADVISER highlights some of the benefits of Collective Trusts. The article, “Time to Consider a Collective Trust?”, John Manganaro provides an overview of Collective Trusts, how they are used, and why they are appealing alternatives to target date or balanced funds. Interest in Collective Investment Trusts (CITs), which are also known as […]
12 common 401(k) compliance errors
According to the IRS, the most common errors in connection with qualified plans, and specifically a 401(k) defined contribution plan, are as follows: Failure to update the required plan document to reflect required mandatory law changes governing 401(k) plans Failure to follow the terms of the plan document in operation, generally as to those common […]
Rapid rise of Alternative Investments
Most alternative investment assets are held by institutional investors or by accredited, high-net-worth individuals and, according to Preqin, now total $6 trillion. Alternative investments include hedge funds, managed futures, real estate, commodities and derivatives contracts. But alternative investments aren’t just for institutions any longer. According to Morningstar alternatives investment analyst Josh Charney, $38.7 billion flowed […]
New Endowment IndexTM Launched to Provide Independent Benchmark for Fiduciaries
Endowment IndexTM now available as a benchmarking tool for investors that manage multi-asset portfolios comprised of both traditional (stocks and bonds) and alternative (private equity, real assets, hedge funds) asset classes. Appleton, WI (PRWEB) May 22, 2014 Endowment Wealth ManagementTM, Inc. in collaboration with ETF Model SolutionsTM, LLC have launched the Endowment IndexTM (Symbol: ENDOW) as […]
Smart Beta or Strategic Beta?
Morningstar has put together the following matrix to help clarify the above, that we find very useful in our model portfolio construction:
Advisors Improve 401(k) Plan Satisfaction of Small Business Owners
Survey shows small business owners that work with a financial advisor are more satisfied with their 401(k) Plan. A recently published survey of employers regarding their 401(k) Plan offered several insights into the impact that 401(k) Plans have for employers that have between 25 and 250 employees. In summary: Plan Sponsors that work with a […]
Dividend Investing
The era of ZIRP, easy money and financial repression has forced many savers/retirees to look elsewhere for yield/income. This has forced many investors to look at dividend paying stocks to capture a more predictable source of income and as a hedge against market gyrations. With the “graying” of America, it is not surprising that increasingly […]
Retirement Remains Americans’ Top Financial Worry
Is this a surprise? As per a recent Gallup survey, a majority of Americans, 59%, are worried about not having enough money for retirement, surpassing eight other financial matters. A majority of Americans have reported being “very” or “moderately” worried about retirement savings every year since 2001, illustrating that saving for retirement disquiets Americans in both […]
Best Practices in 401(k) and 403(b) plan design
A leading-edge 401(k) or 403(b) plan should consider the following plan design features: Immediate eligibility to make employee deferral contributions with a one-year wait period to receive employer matching contributions; Automatic enrollment at an employee deferral contribution rate of between 3% and 6% and automatic employee deferral escalation of 1% each year up to a maximum 10% […]
