May 2017

23May

US. Trump Budget to Cut Federal Pensions

The Trump administration’s 2018 budget to be released tomorrow will include a range of proposed spending cuts. The budget will call for cuts to food stamps, Medicaid, and other entitlement programs. These reforms come on top of proposed cuts to discretionary programs released in March. There is more good news. The budget will propose cuts to the fat benefit packages received by federal workers. An April CBO report found that benefits for the government’s civilian workers were 47 percent higher,...

May 23, 2017
News
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22May

US. Government pensions leave retirees, taxpayers in a bind

Underfunded pensions, mainly for government employees, are a disaster waiting to happen, and the concern about underfunded pensions is rising daily as the number of newspaper articles on the topic increases. While most corporate employers shifted from pension plans to 401(k) plans after the early 1980s, governments still offer pensions to employees. Those pensions have left retirees and taxpayers in a bind that has fueled political battles while continuing to enrich investment consultants and managers. The result is that overly...

May 22, 2017
News, OP Ed
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18May

US. Thanks To Hedge Fund Fee Structure, Pension Funds Will Pay $30 Billion Extra

One of the biggest arguments against active management is the fee structure of actively managed funds. With an annual charge of 100 basis points or more levied on investors in active funds, even if these funds track the market, they will underperform. In order for an investor to beat the market by owning an active fund, the fund would have to outperform the market by at least 100 basis point every year to justify its fee, which is almost...

May 18, 2017
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17May

US. House committee approves sweeping pension bills

Two comprehensive pension reform bills were OK’d by an Illinois House committee Tuesday, but their fate in the full House is far from certain. The House Personnel and Pensions Committee approved House Bill 4027 and House Bill 4045, which are identical except that one is sponsored by House Republican Leader Jim Durkin and the other by Rep. Barbara Flynn Currie, D-Chicago. Both bills combine a pension reform promoted by Senate President John Cullerton, D-Chicago, with a number of money-saving pension ideas...

May 17, 2017
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12May

US. How United Technologies created ‘the retirement plan of tomorrow’

United Technologies Corporation was ahead of its time when it came to employee retirement benefits. The Fortune 500 company — the parent to Otis, Pratt & Whitney, UTC Aerospace Systems and UTC Climate, Controls & Security— made a point of offering its employees an in-plan guarantee of retirement income well before the topic of lifetime guarantees in 401(k) plans took center stage in the national discussion. Five years ago, the company decided to revamp its retirement plan, and worked with Prudential...

May 12, 2017
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09May

Prudential names new Prudential Retirement CEO

Prudential Financial, Inc. (NYSE: PRU), announced that Phil Waldeck has been named President and Chief Executive Officer of Prudential Retirement, a division of Prudential Financial, Inc., effective June 5. He succeeds Christine Marcks, who has informed the company of her decision to retire after more than 13 years of distinguished service, 10 of which were in the role of President and CEO. “Under Chris’s leadership, Prudential Retirement created a talent-centered, customer-focused culture that has inspired and created significant business growth...

May 9, 2017
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08May

US: What does longevity have to do with Social Security?

According to the 2015 Social Security report, less than 7 percent of people with enough quarters to draw their Social Security benefit died prior to receiving. There are three other groups of individuals that will not receive benefits – infrequent workers who do not have sufficient earnings to qualify for benefits, non-covered workers such as state and local government employees who did not pay into the program and immigrants who arrive in the United States at 50 or older...

May 8, 2017
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04May

US. Senate Kills State-Sponsored Retirement Plans For Private Sector Workers

In a narrow vote, 50 (yes) to 49 (no), the Senate by resolution killed an Obama-era rule that greenlighted state-sponsored auto-IRA retirement programs for small business workers. A majority vote was needed to repeal the rule. The AARP cried foul and urged a “no” (don’t repeal the rule) vote because: “Too many small business employees don’t have a way to save for retirement out of their regular paycheck.” That’s 55 million workers. “This is an industry effort to try to...

May 4, 2017
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03May

US. The Obama-era workplace retirement plans that the GOP wants to kill

I’m at a loss as to why some Republicans on Capitol Hill want to block the creation of workplace retirement plans for small-business employees. We know that Social Security will soon face some serious funding issues. And with fewer companies offering pensions these days, we know that workers have to save for their own retirement. The percentage of employers still offering a traditional defined benefit plan to new hires has fallen significantly, according to advisory services firm Willis Towers Watson. In...

May 3, 2017
News, OP Ed
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April 2017

27Apr

US. IRI wants tax reform, but not at expense of retirement plans

The Insured Retirement Institute is urging the Trump administration and Congress to tread lightly in considering tax reforms that would strip incentives to save in qualified retirement plans. In an extensive letter to the Commerce and Treasury Secretaries and Republican and Democrat leaders on tax policy in both chambers of Congress, IRI says proposals that would limit the tax preferred treatment of contributions to employer-sponsored retirement plans would “risk significantly impairing retirement security” for the country. “With 30 million Baby Boomers...

April 27, 2017
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