November 2022
17Nov

Germany. Social partners move forward to implement pure DC plans

German employer and employee representatives are taking the first steps to implement the social partner models for pensions signed up recently, under a new legal framework, with other candidates planning to offer pure defined contribution (DC) schemes. The investment strategy under the social partner model set up by energy company Uniper with unions is taking shape, with a social partner advisory board – Sozialpartnerbeirat – constituted last week, that has decided on asset class allocation, and the upper limit of...

November 17, 2022
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07Nov

The future of defined contribution asset allocation

Strategy discussions around defined contribution workplace saving tend to focus on plan design and engagement but questions of asset allocation are also critical, according to a discussion summary of the most recent Jasper Forum. The Forum was led by Australian Retirement Trust head of asset liability management Brnic van Wyk, Putnam Investments' Mike Dullaghan, DCALTA's Jonathan Epstein, Aon's Rick Jones, Morningstar's Aron Szapiro, and Utrecht University PhD candidate Jorik van Zanden. In the discussion wrap-up, JM3 Projects principal John Mitchem said...

November 7, 2022
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02Nov

U.S. Allianz Life Launches Income Annuity for Use in DC Plans

Allianz finds growing numbers of U.S. workers want guaranteed income options in their employer-sponsored retirement plan. Allianz Life Insurance North America launched the Lifetime Income+ Annuity, an in-plan guaranteed lifetime income option for defined contribution plans. The Allianz Life fixed index annuity is now available to any plan sponsor connected to the iJoin/IPX Retirement network of recordkeepers, a spokesperson said in an email. “We designed this product to be personalized, flexible, and portable for users,” said...

November 2, 2022
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September 2022
28Sep

Analysis of American Workers Shows Retirement Plan Type Influences Spending Habits

A new report by the Public Retirement Research Lab and JP Morgan demonstrated that public-sector workers whose primary retirement account is a defined benefit account tend to spend a higher ratio of their earnings than those with a defined contribution account. Read also With Interest Rates Rising, Companies Look to Unload Pension Liabilities The PRRL is a collaboration of the Employee Benefit Research Institute and National Association of Government Defined Contribution Administrators. They combined their datasets on public employees with defined...

September 28, 2022
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23Sep

UK. Inflation presents ‘considerable risk’ to DC pension pots

Skyrocketing inflation figures pose unique challenges for defined contribution pension schemes as memberships surge to record highs, according to the Pensions Policy Institute’s DC Future Book. Though the state pension triple lock provides “partial protection” for those in retirement against inflation, the PPI warned that the cost of living crisis could be compounded if returns on investment do not match inflation, which would lead to erosion in the value of DC pots. Active DC membership now stands at 13.8mn people, 10.7mn...

September 23, 2022
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09Sep

Rise of DC poses risks and challenges for future pensioners

Increasing reliance on defined contribution savings means the needs of future pensioners will be markedly different from those of previous generations, placing greater emphasis on the need for support, according to a new report. The report from the Pensions Policy Institute, published on September 8, explained that increasing reliance on DC pots as opposed to older defined benefit schemes results in “more complex” retirement finances that future pensioners will have to manage, and that these will require more active engagement...

September 9, 2022
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July 2022
22Jul

The Effects of Myopia on Retirement Savings Decisions

By Justin van de Ven Recent pensions policy debate in the United Kingdom has emphasised the role of behavioural myopia in justifying state involvement in retirement provisions (e.g. Pensions Commission, 2005, pp. 68-69, and op.cit.). In this regard, it appears that the public debate has gotten slightly ahead of the economic literature, as there currently exist very few studies that consider the empirical support for myopia on field data, or the practical implications of myopia for behavioural responses to policy...

July 22, 2022
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June 2022
24Jun

Would the Securing a Strong Retirement Act Secure More Retirement Equity?

By Albert Feuer On March 29, 2022 the House approved H.R. 2954 that is titled the Securing a Strong Retirement Act of 2022 (the SECURE Act 2.0) by a vote of 414-5. On May 26, 2022, a discussion draft of the Retirement Improvement and Savings Enhancement to Supplement Healthy Investments for the Nest Egg (RISE & SHINE) Act of 2022 was released by the Senate Health, Education, Labor, and Pensions Committee Chair Senator Patty Murray (D-WA), and Ranking Member Senator Richard...

June 24, 2022
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16Jun

US. DC plan participants prioritizing returns over principles

Increased interest in incorporating ESG principles in defined contribution retirement plans, leveraging collective investment trusts (CITs) and offering financial wellness tools as a value-add are some of the latest trends on the minds of consultants and advisors, according to T. Rowe Price’s 2021 Defined Contribution Research Study conducted in partnership with Schaus Group. Michael Davis, T. Rowe Price’s head of defined contribution plan specialists, told Benefits PRO that the survey responses from 32 consultant and advisory firms jibes well with...

June 16, 2022
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09Jun

Factors Influencing the Choice of Pension Distribution at Retirement

By Robert L. Clark & Olivia S. Mitchell One of the most important financial decisions that pension participants make concerns how they access their pension assets when they terminate employment with their plan sponsor. Their choices depend both on own preferences and the options offered by their retirement plan. This paper examines both past and future pension withdrawal choices for those with defined benefit and defined contribution pensions, separately. Our data are drawn from a set of pension distribution questions...

June 9, 2022
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