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Tool Navigates Sea of Target-Date Funds

September 15, 2008 - Target-date funds, also known as lifecycle funds, are rapidly rising in 401(k) plans as the favorite qualified default investment alternative because they're much more appropriate than the traditional money market fund for hands-off investors. In theory, you simply pick the target date that's closest to when you expect to retire, and you're done. The fund rebalances your asset allocation over time, growing more conservative as you grow older. If only it were that simple.

Fund Companies Should Rethink Retirement

September 15, 2008 - Americans have changing needs for retirement products as they grow older, and mutual fund companies that recognize and respect the differences between the age groups can be much more effective. Charles Schwab recently surveyed thousands of adult Americans across four generations in order to gauge their different levels of perceptions and expectations about retirement. The groups were divided into the Silent Generation, ages 63 to 83; Baby Boomers, ages 44 to 62; Generation X, ages 32 to 43; and Generation Y, ages 21 to 31.

GLWBs Tied to Target-Date Funds, Managed Accounts

September 8, 2008 - Taking dead-aim at Middle America, Allstate Corp. has added guaranteed lifetime withdrawal benefits to its target funds. The product, 'Guaranteed Lifetime Income,' follows a number of guaranteed minimum lifetime withdrawal benefits linked to managed accounts aimed at the high-net-worth.

Industry Roils Against Critical Fund Book

September 8, 2008 - An obscure book about mutual funds has begun to arouse the ire of the industry. Louis Lowenstein's book, 'The Investor's Dilemma. How Mutual Funds Are Betraying Your Trust and What To Do About It (Wiley, 2008),' levels some serious charges about the self-serving interests of investment companies. Lowenstein, who has widely written on the financial markets, is the Simon Rifkind Professor Emeritus of Finance and Law at Columbia University. The book slams mutual funds.

403(b) Overhaul First Since 1964

September 8, 2008 - AUSTIN, Texas - Making sure your company's 403(b) retirement plan is in compliance by Jan. 1, 2009 can be a daunting task, especially if you haven't gotten started yet. The new regulations by the Internal Revenue Service and Department of Labor loom as a ticking time bomb to some plan sponsors and vendors prone to procrastination, but IRS officials say the changes are meant to improve the plans, not frighten employers. 'We have no intention of going out and doing an extensive number of audits next January, nor do we have plans to increase the number of 403(b) audits we're doing now,' said an IRS official, who asked not to be identified, in an interview with MME.

Industry Braces for New 403(b) Regs

September 8, 2008 - AUSTIN, Texas - New 403(b) regulations are coming, whether or not plan sponsors and vendors are ready for the changes. 'This is different from anything we've ever done before,' said Tom Peller, vice president of compliance for Fidelity Investments, at the SPARK Institute's 403(b) Plans Issues and Answers Forum here last month at the Hyatt Regency hotel. 'In the past, when you had to do compliance, it was linear. You just checked things off one thing at a time. Almost all the changes in 403(b) regs are interconnected. Everything you change will impact something else. Your approach should be very different.'

With Good 401(k) Planning, Everybody Wins

August 18, 2008 - In addition to helping employees save for retirement, a solid 401(k) plan can help companies to attract, motivate and retain good workers, enhance a company's corporate reputation and contribute to the long-term financial success of the business, according to a new study by Charles Schwab. Among the findings, 95% of financial executives consider their company's matching contributions to be an important feature of the plan, but they still see room for improvement in making a better partnership with employees, according to the study, 'A Shared Benefit: Employer Views on the Value of 401(k) Plans.'

Overlay Projects Proceed Amid Downturn

August 11, 2008 - Given the turbulence in financial markets, now may seem an inopportune time for financial advisers to make drastic changes to the way they interact with investors. But according to bank officials and technology providers, plenty of banks are moving ahead with their plans to implement new systems, including those that offer unified managed accounts and overlay software.

Wealthy Investors Grow Pessimistic

August 11, 2008 - As the stock market continues to stumble along, high-net-worth investors are becoming increasingly pessimistic about the economy and dissatisfied with the performance of their financial services providers. 'When times are going well, people don't complain about fees, they complain about softer stuff, like how they don't think their adviser is attentive enough,' said Walt Zultowski, senior vice president of research and concept development for The Phoenix Companies and author of the '2008 Phoenix Wealth Survey.'

The Dichotomies of the 22 Million Mass Affluent

August 4, 2008 - America's new mass affluent blend so effortlessly into society that it's often impossible to tell them apart from a traditional middle class family one day, or from an upper class family the next. Depending on which day you encounter a typical new mass affluent family, a mother could be found cutting out coupons and buying bulk at Sam's Club, or she and her husband could be playing golf at their country club.

Retirement Assets Reach $17.6 Trillion, ICI Reports

July 28, 2008 - Despite difficult market conditions, Americans continued to save more for retirement last year, according to the Investment Company Institute.

401(k) Plans Move to Collective Trusts

July 28, 2008 - BOSTON - Workers love pension plans, but providing 20 to 30 years of benefits to a huge retired workforce can cripple most companies' profits. As more firms drop their defined benefit pension plans in favor of defined contribution 401(k)s, institutions are looking for qualified default investment alternatives to mutual funds, such as collective investment trusts (CITs) and separately managed accounts (SMAs), to provide employees with pension-like features.

Fund Execs Defend 401(k) Fees

July 28, 2008 - BOSTON - Excessive fees in some 401(k) plans are hurting the reputation of all 401(k) plans and shaking investor confidence in what most financial experts agree is a great way for the majority of Americans to save for retirement. 'There is a notion in the press that 401(k) investors are being hosed. This is not the case,' said Michael Hadley, the Investment Company Institute's associate counsel for pension regulation, at the 'Defined Contribution Investment Only Forum,' held last Monday and Tuesday at the Harvard Club, and hosted by Financial Research Associates. '401(k) investors are getting an incredible deal.'

Hey, Boomers, Surf's Up!

July 21, 2008 - Don't just retire. 'Reengage, reinvigorate, redefine, rejuvenate.' That's the inspirational message at MyRetirementShop.com, a new, all-in-one website for the 'at retirement' generation that AXA Equitable Life Insurance launched last Wednesday, after two years of research and numerous focus groups. Many independent sites already exist, but have had limited success attempting to cater to this crowd. AXA's website is notable not just for its comprehensiveness-from a concierge who can schedule a golf tee time, to learning about working while collecting Social Security benefits, to obtaining a doctor's second opinion-but also because it is the first of its kind for a financial services firm. It provides information pertaining to virtually any lifestyle interest or question that a retiree or pre-retiree might have, not just their finances.

Give Mutual Fund Investors the 'Gold Card' Treatment

July 14, 2008 - Get a little imagination, guys. It never ceases to surprise me how uninspired most financial services, and in particular, mutual fund, advertisements are. Only two come to mind as standouts: AXA's ads with the proverbial 800-pound gorilla in the room, representing the big question of how underprepared most people are for retirement, and another, by an investment firm I cannot even remember, in which an older couple resort to comically drastic financial measures, like taking in an unlikely boarder in order to get by.