he Federal Reserve’s battle against inflation has sent short-term interest rates soaring faster than stable value crediting rates. But many plan sponsors continue to see stable value as the best long-term capital-preservation investment option for defined contribution retirement plans.
Stable value funds invest predominantly in short- to medium-term fixed income securities. Now, researchers at Vanguard Group are looking into whether a stable value fund invested in a mix of stocks and bonds, and incorporated into a target-date fund, might offer advantages to target-date investors.
SECURE 2.0, the retirement savings legislation that passed in December 2022, includes more than 90 provisions designed to make it easier for employers to offer retirement plans and improve retirement outcomes for American workers. At the 2023 SVIA Fall Forum, senior staff members from Capitol Hill said rollout of the legislation is going well despite its complexity.
Presidential elections are expected to turn on policy—how the candidates will govern on key issues like taxes and foreign policy. Next year’s presidential election, says Pulitzer Prize-winning author Robert Samuels, is different—a referendum on which values define us as a country. Put another way, he said, it is a referendum on what it means to be America.
The U.S. economy is humming for the moment but may be headed for a slowdown. Economic futurist Andrew Busch predicts that the third quarter of this year will prove to have been a peak period of growth, one that will be followed by slower growth through the fourth quarter of 2024. But he counters that the economy isn’t likely to sink into a recession, at least in the near term.
Many stable value funds are shrinking, but the principal reason, it turns out, is not because retirement plan participants are withdrawing money from them. Rather, exchanges of money into stable value funds from other asset classes have slowed.
Hamas’ brutal October 7 attack on Israel, and Israel’s swift response, have had tragic results for people in both Israel and the Gaza Strip. From a geopolitical perspective, the conflict could not have come at a worse time for the U.S., says retired Marine Corps Lieutenant General Robert S. Walsh, nor at a better time for Iran.
For employers, the recordkeeping that goes into managing their defined contribution retirement savings plan can sometimes be an afterthought—until something goes wrong or they want to make a significant change to their plan.
Even as employers have improved their defined contribution retirement savings plans, funding one’s own retirement remains, for many workers, a challenging task.