Journey Magazine | Retirement and Investment Publication

A Word: Michael Falcon, Head of Retirement for J.P. Morgan Asset Management

Despite the industry's successes in improving the awareness, access and advice offered within DC plans in recent decades, the retirement challenges today need to be addressed by taking a more holistic view of participants' “financial wellness,” says Michael Falcon, J.P. Morgan Asset Management's head of retirement. Mr. Falcon shares his views on the opportunities and challenges facing plan sponsors and providers, as well as the issues and investments that can be considered to improve retirement success.

Stat Life: Turning a Vision into a Plan

Many participants view income replacement ratios as critical in assessing how much salary they will need to replace in retirement, but their success in calculating these ratios is quite a different proposition. Recent research conducted by J.P. Morgan, however, now shows that the more exposure  participants had to their income replacement projections, the more clarity they gained about their financial goals in retirement—and what they need to do to reach them.

Legislative Corner: Debate, Disclosures and Deficits: A View from Capitol Hill

The tax preferences for employee benefits programs will be among the topics that will be on policymakers’ radar screens for the next legislative session of Congress. A critical question is whether policymakers view the tax expenditures for the employer-sponsored benefits system as sources of revenue to reduce the deficit, or a great bargain because the private-employer sponsored system relieves financial pressure on Social Security and Medicare.

Speaking Investments: The 5 Biggest Myths of Alternatives in DC

More plan sponsors are considering alternative investments as a way to add diversification and dampen volatility. While some plan sponsors may assume they need new evaluation or communication processes or may look to add alternatives as standalone investment options, doing so may not necessarily improve participants` outcomes. We address—and debunk—some of the biggest myths around adding alternatives in DC plans.

Executive Perspective: Retirement at the Tipping Point

In a recent interview, David Musto, Chief Executive Officer of J.P. Morgan Retirement Plan Services, shared his views why he believes the retirement industry is at a “tipping point.” According to Mr. Musto, plan sponsors can help improve retirement success by analyzing offerings from the participants` perspectives, remaining alert to any “unintended consequences” of government regulation, and focusing on an outcome-based approach to plan management.

Searching for Certainty: How Changing Market Conditions are Affecting 401(k) Plan Participant Outcomes

Despite the impact of the market downturn on retirement savings, it appears that saving for retirement has become a diminishing priority for 401(k) participants, according to a study recently conducted by J.P. Morgan Asset Management and Harris Interactive. The study also uncovered a distinct gap between what participants believe they need to save for retirement, and how much they are on track to receiving once they retire.

Plan Sponsor Playbook: How Decisions Impact Participant Income Replacement

Since the market downturn in 2008, many sponsors grapple with how to design retirement plans that will have the most impact on participation and deferral rates and prepare employees to retire when and how they want. This case study examines how one plan sponsors’ plan design decisions are expected to impact employees’ retirement readiness, as measured by projected income replacement ratios.

Active, Passive or Custom?

As target date funds continue to grow in popularity, plan sponsors can improve participant outcomes by ensuring that their TDF designs and strategies align with their plans` goals and objectives. Because the participants themselves still determine how much to save, where to invest and when to withdraw, building a successful TDF approach requires an understanding of their participants` characteristics and engagement levels.

Did You Know: Retirement Plans by the Numbers

A study recently conducted by J.P. Morgan Asset Management and Harris Interactive offers some surprising revelations about plan participants’ retirement readiness. For example, the majority of plan participants appear to be counting on their 401(k) balances as the primary source of retirement income, yet a surprising number of participants admit that saving for retirement comes in a distance second as far as financial priorities.