The ‘Floor-Leverage’ Model

An easy income recipe from Financial Engines: Put 15% of your savings in a triple- leveraged stock ETF and the rest in something safe, like a TIPS ladder.

Time to Put Benjamins Back in the Sock Drawer?

At the LIMRA annual conference in Boston earlier this week, MIT economist James Poterba described how low interest rates make saving for retirement more of a challenge.

Pitching Income Annuities on Greed

Speakers Wade Pfau and Curtis Cloke showed planners at the Financial Planning Association's 2019 conference in Minneapolis that income annuities can provide growth as well as protection.

Research Roundup

Recent research offers new insights into financial decision-making, the decision to work after retirement, and reveals surprising links between aging and interest rates, the rise of the service economy, and the 'shadow banking' phenomenon.
Featured

The Four-Sided Chess Game

Today, insurers are invoking fiduciary duty to justify the offering of lifetime income products in 401(k) plans. If the fiduciary standard were applied to the management of money in rollover IRAs, they might use it to persuade advisers to put part of their clients’ savings in annuities.

Dept. of ‘Say It Ain’t So’

Forbes reporter Ted Siedle alleges that asset managers are using the financial crisis to gain greater control over the billions in troubled public pensions—in this case, Rhode Island’s.
News

As DB wanes in the UK, Brits continue to mull retirement reform

“We do not want to set down a law that says ‘there are three ways you can do pension, and here’s what they are,’” said Steve Webb, Britain's pensions minister, “but to say ‘here’s a set of models, you can choose.’”

Quote of the Week

“The story of book yields on investable assets, as with invested assets, has been one of decline. Gross book yields for the life insurance industry decreased 18 bps in 2012 to reach a low of 5.24% of average investable assets. This is not as large as the 38 bps decrease seen between 2008 and 2009, but the pull of decreasing interest rates has obviously overpowered moves that insurers made to increase yield in the post-crisis period.”-- from Conning's 'Life Insurance Investments' study, October 2013.

The Bucket

Brief or late-breaking items from Financial Engines, Prudential, Guardian Insurance and BNY Mellon.