Defined Contribution

Conservative Options in Defined Contribution Plans

March 2017
Capital preservation options are widely utilized in DC plans and, in fact, data shows participants can over-allocate to these options. For some, capital preservation is the ultimate “sleep at night” option. For others, it’s a conservative strategy designed to limit risk to principal and preserve purchasing power of assets. There is an evolving spectrum of options in the marketplace to address various participants’ needs and there are several timely reasons why plan sponsors should revisit these options within their plan line-up. This Insights evaluates the most heavily represented Defined Contribution capital preservation plan options and provides a framework for constructing and communicating the most appropriate line-up for participants.


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Enhancing DC Plan Processes & Outcomes in 2017

January 2017
As we focus on DC plan priorities for 2017, several key themes emerge. With a backdrop of an uncertain regulatory environment and heightened litigation activity with a significant increase in not only the volume, but also the breadth of claims, 2017 provides an opportunity to double down on fundamentals. In short, this is an opportunity to go back to the basics, revisit process, past decisions and documentation.


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Overcoming Challenges in the 403(b) Tax Exempt Market

July 2016
In 2007, the IRS issued regulations that effectively made 403(b) plans more similar to 401(k) plans. The regulations had a dramatic impact on 403(b) plans, resulting in (1) greater focus on fiduciary oversight, (2) improved investment lineups, and (3) consolidated administrative platforms (i.e. recordkeepers/vendors). Despite these changes, in many ways the 403(b) market continues to differ meaningfully from the 401(k) market. The balance of this paper highlights the “then” and “now” with respect to these three main areas, and offers Rocaton’s key takeaways for 403(b) plan sponsors to consider going forward.


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Diversified Multi-Asset Strategies in a Defined Contribution Plan

February 2016
Investors of all types are currently faced with an environment that is marked by relatively expensive assets and low return expectations. This is particularly true for Defined Contribution participants where plan lineups are often dominated by traditional fixed income and equity exposures. One potential solution to this issue is to consider adding a diversified multi-asset strategy to a plan’s lineup. In short, these strategies target positive real returns (typically, 3-5% over inflation) with modest levels of expected risk (typically, less than half that of public equities). The balance of this paper will review the characteristics of these strategies, provide a comparison to more traditional real asset strategies and outline some of the considerations plan sponsors should understand.


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Money Market Reform: An Update for Defined Contribution Plans

July 2015
Last year, the Securities & Exchange Commission approved amendments to Rule 2a-7 of the Investment Company Act of 1940 which governs U.S. money market funds. Shortly after the announcement, Rocaton circulated a memo to clients summarizing these reforms and noted that investors should revisit the objectives and risk tolerance for their money market vehicles, especially those invested in prime money market funds which are most affected by the new amendments. This Rocaton Insights provides an update on this important topic.

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Custom Target Date Options: A Higher Hurdle

April 2015
Given the high utilization of target date options in defined contribution plans, target date options are receiving ever greater scrutiny. As such, custom target date options are becoming a more popular discussion topic. While there are many factors that could lead a plan sponsor to seriously consider custom target date options, we believe there are a few key considerations that should receive the most weight when considering custom target date solutions. We suggest that there should be a higher hurdle for custom implementation and we outline a number of considerations for custom target date options in this Rocaton Insights.


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15 in ’15: 15 Considerations for Your DC Plan in 2015

February 2015
Rocaton has compiled a list of our top 15 considerations for Defined Contribution Plan Sponsors to contemplate over the course of 2015 and beyond. Some topics are potentially time-sensitive items that could be addressed this year, while others are longer-term suggestions. Not every item may be appropriate for all plans, and clearly prioritization of these items relative to the needs of each plan is appropriate. This Rocaton Insights covers these 15 considerations in more detail.


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PBS FRONTLINE documentary “The Retirement Gamble”

April 2013
This program was fairly critical of DC plans in general, highlighting issues that have led to instances in which participants were unsuccessful in building adequate retirement savings balances. Although many of the issues highlighted in the program deserve attention, the program also failed to discuss the many positive developments in DC plans over the past few years. The attached Insights summarizes Rocaton’s response to the program and provides some talking points that might be useful in discussions with your DC plan participants.


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