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Quarterly Considerations 12/31/2015

Plan Sponsors

Low Cost Not Enough – Anthem’s $5 billion 401(k) plan faces a lawsuit for excessive fees, which is especially surprising given the Plan offers mostly institutionally priced indexed Vanguard funds. The suit claims that separate accounts at even lower costs should have been implemented.  Money Market Changes – Effective October 2016, a new SEC rule requires providers of prime money markets to create redemption gates and withdrawal fees to prevent a run on the funds. Government money market funds are a good alternative for plan sponsors to avoid these considerations.  Little Progress – Funded levels of the country’s largest corporate pension plans finished 2015 largely unchanged from 2014 levels.  Aggregate pension funded status was 82 percent at the end of both 2014 and 2015, according to Towers Watson.

Nonprofit Organizations

Going Online – Charitable giving has been rising about five percent a year recently, but online giving is rising much faster at a rate of ten percent over the last few years. However, online giving still represents only about six percent of overall giving.

Private Clients

Take Your Financial Temperature – Start the New Year off on solid financial footing! Are you aware of the new contribution limits for retirement plans, changes to estate and tax laws, and comfortable with your life and P&C insurance coverages?


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