June 2020
18Jun

US. Trump SEC Chairman Urges 401ks To Gamble Away Coronavirus Losses

By Edward Siedle Trump SEC Chairman Jay Clayton urges 401k plan sponsors and investors to gamble on private equity funds as a means of recovering coronavirus losses. Since when is it the job of the Chairman of the world’s premier securities regulator to encourage reckless risk-taking by American workers already reeling from pandemic losses? Last week, the U.S. Department of Labor opened the door for plan sponsors to add private equity funds to their 401(k) plans. The Trump administration claims...

June 18, 2020
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16Jun

The future of aging in the US

What does the future of aging in America look like? For answers, every year we ask some of our newest Influencers in Aging to offer their views at the American Society on Aging’s Aging in America conference. The pandemic turned this year’s in-person panel into a June 11 webinar, and the Influencers’ forecasts — as well as their laments — couldn’t have been timelier. “I want to acknowledge that we as a country have had a few rough months...

June 16, 2020
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15Jun

Top US pension fund aims to juice returns via $80bn leverage plan

Calpers is to move deeper into private equity and private debt by adopting a bold leverage strategy that the $395bn Californian public sector pension fund believes will help it achieve its ambitious 7 per cent rate of return. In a presentation to the Calpers board, Ben Meng, chief investment officer, said the giant fund would take on additional leverage via borrowings and financial instruments such as equity futures. Leverage could be as high as 20 per cent of the...

June 15, 2020
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11Jun

9.5 Million Americans Are Raiding Retirement Accounts Amid Covid-19

The Covid-19 pandemic has crippled economies all around the world. From healthcare disasters to black swan financial events, it has been quite some time since the future has seemed so bleak. According to a story originally published by CNBC, this widespread financial strife has caused more than one in four Americans to raid their retirement savings. Read also US. The Reason COVID-19 Might Destroy 22% of Workers’ Retirement Although withdrawing from retirement plans during a financial emergency may seem like...

June 11, 2020
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09Jun

US. Pandemic creates pension plan tension: Take the lump sum or trust lifetime payments

One of the risks that comes with pension plans may be looming larger than usual. As many companies work to regain their financial footing in the midst of continuing economic uncertainty caused by the coronavirus pandemic, a retiring worker’s decision to take either a lump sum or lifetime payments from their pension could boil down to one factor: whether they think the employer will be able to meet its long-term commitments. “That’s one of the biggest considerations that employees...

June 9, 2020
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08Jun

US. The Reason COVID-19 Might Destroy 22% of Workers’ Retirement

Ever since U.S. cases of COVID-19 started multiplying back in March, the economy has been in shambles. Millions of workers have lost their jobs, while countless small businesses have closed their doors, perhaps forever. With so many people desperate for money, it's clear that a relief package was necessary, and so in March, lawmakers passed the CARES Act. Perhaps the most popular feature of the CARES Act was the $1,200 stimulus payment it produced, but another notable feature is...

June 8, 2020
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08Jun

US. Why you may wind up relying more on social security in retirement than you expect to

The median amount that U.S. workers have saved for retirement is just $50,000, according to a recent report from the Transamerica Center for Retirement Studies. Even among baby boomers -- the generation that is currently in the midst of retiring -- the median worker only has about $144,000 socked away. For many, that amount of money likely will be depleted after just a few years in retirement. Fortunately, Social Security benefits will provide retirees with a steady income stream...

June 8, 2020
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05Jun

US. Making Sense Of The Supreme Court Ruling On Private-Sector Pensions

A Supreme Court decision this week on employer pensions? Yes, indeed. The ruling itself Earlier this week, the Supreme Court handed down its decision in Thole v. U.S. Bank, a case in which two retirees in the U.S. Bank pension plan contended, as part of a class action, that U.S. Bank had violated its fiduciary duty in mismanaging its pension plan from 2007 to 2010, causing its assets to crash. (See Reason and 401K Specialist for summaries.) The plaintiffs...

June 5, 2020
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05Jun

US. Bill to limit pensions for officials convicted of crimes moves forward

Lawmakers moved to restrict pensions for public officials who commit crimes while performing their official duties. Senate Bill 719 passed unanimously from the House Pensions and Retirement Committee on Wednesday. It targets elected government officials convicted of a felony offense connected with their service. Convicted officials could collect only the amount of money they contributed to the retirement system plus interest. Nor could they count unused sick leave accumulated after July 2007 toward their retirement benefits. The bill won’t...

June 5, 2020
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04Jun

U.S. clears private equity as investment option for retirement plans

The U.S. Department of Labor issued guidance on Wednesday that allows private equity investments to be offered to U.S. retirement plans as part of diversified investment funds, a move that the leveraged buyout industry has long called for. Employee-sponsored defined benefit plans, such as the pension funds of public sector workers, have long been allowed to include buyout funds in their investment portfolios, turning private equity into a multi-trillion-dollar industry. Read also US pension plans warned they will run...

June 4, 2020
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