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DIVERSIFIED
INVESTMENT ADVISORS
and
American Hospital Association recently conducted its
fourth annual Retirement Plan Trends in Today’s
Healthcare Market – 2006. In addition, Diversified
Investment Advisors also released its Report on
Retirement Plans – 2006 which surveyed companies
with 1,000 or more employees. Both reports highlight
the continuing evolution of the retirement plan
landscape and provide valuable benchmarking tools for
plan sponsors and their advisors.
A common
theme is clearly evident in both surveys. With the
enactment of the Pension Protection Act of 2006,
automatic plan features such as enrollment and deferral
increases, and managed accounts continue to be a growing
trend to help participants simplify their
decision-making. Other findings of note from the
surveys include:
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Of
those surveyed for our Report on Retirement Plans
– 2006, automatic features designed to help
participants manage their accounts are rising in
popularity. Nearly one-quarter have already
implemented automatic rebalancing and nearly
one-third have a managed account option.
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Retirement Plan Trends in Today’s Healthcare Market
finds that a greater number of investment options
are being offered, consistent with the trend of
increased investment flexibility and open
architecture.
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On the
defined benefit side, 23% of plan sponsors intend to
terminate their DB plan; 28% intend to freeze their
pension plan, and another 26% plan to reduce DB plan
benefits over the course of the next year.
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Retirement Plan Trends in Today’s Healthcare Market
reveals an 11% increase in the offering of
hybrid plans such as cash balance plans. The shift
in hybrid plans is primarily away from traditional
defined benefit plans and toward cash balance plans.
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Report on Retirement Plans highlights the
growing popularity of money purchase and profit
sharing plans with 36% of employers with 1,000 or
more employees now offering this benefit, up from
12% in 2004 and 19% in 2005.
For more
information about Diversified Investment Advisors,
please contact Peggy Santhouse at 888-401-5342 or via
e-mail at
psanthouse@divinvest.com.
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