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To Do: Check Your Savings Goals This Week!

By Miriam Bridges

February 22, 2021

VIEW AS PDF

ICI and the ICI Education Foundation are participating in America Saves Week, and so can you!

This week, the Investment Company Institute (ICI) and the ICI Education Foundation (ICIEF) are joining thousands of corporations, nonprofits, government agencies, and individuals to celebrate America Saves Week. This annual campaign encourages Americans to assess their financial situations, set savings goals, and implement plans to achieve them.

Over the course of the week, the campaign covers different themes to help you achieve your financial goals. Start your to-do list and check that you are:

✓ Saving for the unexpected. Building an emergency fund helps you deal with life’s unexpected expenses—and this past year has reminded many of us of the importance of preparing for surprises. Some people find that mutual funds are one place where you can keep emergency savings. ICI research shows that 47 percent of mutual fund–owning households listed saving for an emergency as a financial goal for their mutual fund investments.

✓ Saving by reducing debt. By paying down debt, you are saving! Actively reducing your debt means you’re saving on interest, avoiding late fees, and helping your credit score. But reducing debt doesn’t always mean you should put retirement saving on hold until you eliminate all debt.

✓ Saving to retire. Millions of Americans across all income groups use 401(k) plans or individual retirement accounts (IRAs) to help prepare themselves for retirement. Make sure you’re one of them! Today, 60 million Americans are active participants in 401(k) plans, and as of 2017, more than 60 million Americans held investments in IRAs. Visit ICI’s website offering facts on retirement to learn more about America’s retirement system.

✓ Saving automatically. There are two great ways to save automatically for retirement: through an employer-sponsored retirement plan (such as a 401(k) or a 403(b) plan) or an IRA. Check with your employer to see if you have a 401(k) plan or 403(b) plan available to you, and if so, make sure you’re enrolled in it. An IRA can be a great option if you don’t have a plan at work—or as extra tax-favored savings even if you do.

✓ Saving as a family. Now that you’re well on your way to establishing successful money habits, you can start supporting your loved ones in a number of ways on their path to financial wellness.

  • It’s never too early to start learning how to budget and save, and start thinking about how to invest. Consider involving young family members in managing an investment account.
  • Another way to help family save and invest is through a spousal IRA. These accounts can help nonworking spouses build savings. If you are working and you have a spouse who either earns a lot less or is not working, you can use your earnings to open up an IRA for that spouse to build a nest egg for retirement.
  • Families can support the education goals of their children by preparing for education costs through a 529 plan. Once you open an account, both you and others, such as grandparents, can put money into it. Funds from a 529 savings plan can be used to fund K-12 education, postsecondary education costs, and apprenticeship programs.

Get on the Road to Saving

ICIEF has two digital resources available to help you understand the important role of saving and investing in reaching your long-term financial goals. Explore essential investing basics like diversification, compound interest, and risk while you travel through the Investing Road Trip. Then, put the investing basics into action by Playing the Long Game! Invest $1,000 in the S&P 500, follow the market, then decide to stay invested or sell your holdings.

Take the Pledge and Keep Learning

  • ICI and ICIEF encourage you to take the America Saves Pledge, and once you do, you’ll also receive support and tips from America Saves.
  • Check out the resources available on the ICIEF website, including a helpful series examining different concepts essential to successful investing.
  • See the following organizations ICIEF partners with for other good resources on saving and financial literacy: the American Savings Education Council, the Alliance for Investor Education, and the Jump$tart Coalition for Personal Financial Literacy.
  • Follow @ICIEF on Twitter, and use #ASW2021 to learn more from other organizations participating in America Saves Week. You can also find ICIEF on Facebook and LinkedIn.

Miriam Bridges is vice president of the ICI Education Foundation.

https://www.ici.org/viewpoints/21_view_asw

TOPICS: 401(k)Equity InvestingIRAInvestment EducationInvestor ResearchMutual FundRetirement PolicySavingsShareholder

Main Street Owns Wall Street

By Sarah Holden and Michael Bogdan

February 10, 2021

Stock ownership used to conjure up images of Wall Street—but today people all up and down America’s Main Streets own stocks and are counting on stock ownership to help realize their financial goals. Today, more Americans own stock than in the past—and stock ownership has become increasingly common for lower- and middle-income households.

Read more…

TOPICS: Equity InvestingInvestor ResearchMutual FundRetirement PolicySavingsShareholder

Mutual Funds: Rated G—All Audiences Admitted

By Sarah Holden and Dan Schrass

February 4, 2021

Investing is subject to many misconceptions, including the notion that only older households, or only wealthy households, or only households saving for retirement own mutual funds. The reality is that households of all ages, all incomes, and with a wide range of financial goals, own mutual funds.

Read more…

TOPICS: Investor ResearchMutual FundRetirement PolicySavingsShareholder

2020 Annual Report to Members: Roundtable: The Fund Industry’s Response to COVID-19

By Patrice Bergé-Vincent, Marty Burns, and Susan Olson

January 19, 2021

For the 2020 Annual Report to Members, three members of ICI’s leadership sat down to share their thoughts on how the Institute and the fund industry have navigated the COVID-19 crisis.

Read more…

TOPICS: Financial MarketsFinancial StabilityFund RegulationGlobalGovernment AffairsICI GlobalIndex FundInternationalInvestor ResearchMutual FundPolicy ResearchRetirement PolicyShareholder

2020 Annual Report to Members: A Conversation with Paul Schott Stevens

By Paul Schott Stevens

January 14, 2021

Paul Schott Stevens, ICI’s longest-serving chief executive, retired at the end of 2020. As he neared the end of his 16 years of service, he sat down with ICI staff to discuss the events of his tenure.

Read more…

TOPICS: Financial MarketsFinancial StabilityFund RegulationGlobalGovernment AffairsICI GlobalIndex FundInternationalInvestor ResearchMutual FundPolicy ResearchRetirement PolicyShareholder

2020 Annual Report to Members: A Letter to ICI’s Membership

By George C. W. Gatch

January 11, 2021

2020 will go down in history as a year that none of us can ever forget. It was a year of turmoil, fear, and reckoning. Yet for the regulated fund industry, it also proved to be a year of resilience, transition, and great hope.

Read more from ICI Chairman George C. W. Gatch’s letter that was released in ICI’s 2020 Annual Report to Members.

Read more…

TOPICS: Financial MarketsFinancial StabilityFund RegulationGlobalGovernment AffairsICI GlobalIndex FundInternationalInvestor ResearchMutual FundPolicy ResearchRetirement PolicyShareholder

Congress Should Give Americans Flexibility to Keep Retirement Savings on Track

By Paul Schott Stevens

July 31, 2020

As policymakers take further steps to assist families and businesses weathering the storm, Congress can help American families get their retirement savings goals back on track by including the “Temporary Coronavirus-Related Catch-Up Contribution” proposal in the next COVID-19 relief package.

Read more…

TOPICS: 401(k)Government AffairsIRAMutual FundRetirement PolicyShareholder

2020 Investment Company Fact Book: Letter from the Chief Economist

By Sean Collins

May 19, 2020

A version of this letter by ICI Chief Economist Sean Collins was released in the Institute’s 60th edition of the Investment Company Fact Book.

Read more…

TOPICS: Financial MarketsFund RegulationGlobalInvestor ResearchMutual FundPolicy ResearchRetirement PolicyRetirement ResearchSavingsShareholder

2020 Investment Company Fact Book: Letter from the President and CEO

By Paul Schott Stevens

May 13, 2020

This ICI Viewpoints is a version of a letter from ICI President and CEO Paul Schott Stevens that was released in the 60th edition of the Investment Company Fact Book.

Read more…

TOPICS: Financial MarketsFund RegulationGlobalInvestor ResearchMutual FundPolicy ResearchRetirement PolicyRetirement ResearchSavingsShareholder

2019 Annual Report to Members: ICI's International Work

By Miriam Bridges

November 21, 2019

With the industry's interests bound ever more tightly to global trends, ICI pursues an active international agenda through its international arm, ICI Global. ICI’s international work in 2019 was a period of vigorous effort on a host of issues....

Read more…

TOPICS: CybersecurityExchange-Traded FundsFinancial MarketsFinancial StabilityGlobalICI GlobalInternationalOperations and TechnologyRetirement Policy

ICYMI: A Q&A with Members of ICI's Retirement Team

November 19, 2019

For this year's 2019 Annual Report to Members, four members of ICI's retirement team sat down to discuss ICI's legislative, regulatory, research, and communications activities to advocate for well-informed public policies that help Americans prepare for retirement....

Read more…

TOPICS: 401(k)Fund RegulationGovernment AffairsMutual FundRetirement PolicyRetirement ResearchShareholder

2019 Annual Report to Members: A Letter to ICI's Membership

By George C. W. Gatch and Paul Schott Stevens

November 14, 2019

What follows is an abridged version of a letter by ICI Chairman George C. W. Gatch and ICI President and CEO Paul Schott Stevens that was released in ICI’s 2019 annual report. To read their full letter, please see ICI’s 2019 Annual Report to Members....

Read more…

TOPICS: Financial MarketsFinancial StabilityFund RegulationGlobalGovernment AffairsICI GlobalIndex FundInternationalInvestor ResearchMutual FundPolicy ResearchRetirement PolicyShareholder

Critics Claim Retirement Savers Aren’t Behaving Rationally. The Data Say They Are.

By Peter Brady

August 22, 2019

In a letter to MarketWatch responding to “Opinion: This Recent Report Suggests Steady Saving for Retirement Is Not Important,” published August 14, ICI Senior Economic Adviser Peter Brady refutes claims that criticize ICI’s recent retirement research, noting that more people benefit from employer plans than is commonly understood….

Read more…

TOPICS: 401(k)IRARetirement PolicyRetirement Research

2019 Investment Company Fact Book: Letter from the Chief Economist

By Sean Collins

May 7, 2019

Globalization has hit a few speed bumps in recent years, but it hasn't slowed the globalization of the Investment Company Fact Book. Consistent with ICI’s mission to represent the interests of regulated funds and their investors worldwide, Fact Book is expanding its international presence....

Read more…

TOPICS: Financial MarketsFund RegulationGlobalInvestor ResearchMutual FundPolicy ResearchRetirement PolicyRetirement ResearchSavingsShareholder

Don’t Forget the 401(k): America’s Retirement System Helps Workers Save and Preserve Assets

By Paul Schott Stevens

February 26, 2019

In a letter to the Wall Street Journal responding to “Forget the 401(k),” published February 11, ICI President and CEO Paul Schott Stevens shows how the US retirement system actively engages employers to promote workers' retirement saving, noting that the current system also preserves choice and control of investments....

Read more…

TOPICS: 401(k)Retirement PolicyRetirement Research

Mutual Funds: Rated E for Everyone

By Sarah Holden

December 12, 2018

Investing is subject to many misconceptions, including the notion that only wealthy households own mutual funds. As US households’ ownership of mutual funds has grown over the past four decades, the need to correct myths about who owns mutual funds has also grown....

Read more…

TOPICS: Investor ResearchMutual FundRetirement PolicySavingsShareholder

ICI’s 2018 Annual Report: Letter from the President

By Paul Schott Stevens

December 3, 2018

A version of this letter by ICI President and CEO Paul Schott Stevens was released in the Institute’s 2018 Annual Report.

Fund industry watchers will remember this year as one of important policy developments, including some that have been the subject of years of debate. The Investment Company Institute has been deeply engaged in this wide range of issues, working on both legislative and regulatory fronts to promote advantageous outcomes for regulated funds and their shareholders....

Read more…

TOPICS: Exchange-Traded FundsFinancial MarketsFund RegulationGlobalIDCOperations and TechnologyRetirement Policy

Growing Better with Age: The 401(k) Turns Forty

By Miriam Bridges and Christina Kilroy

November 30, 2018

This month marks the fortieth birthday of the most prevalent retirement plan available to workers today: the 401(k). It’s a milestone, to be sure, but there are no mid-life doldrums here—401(k) plans continue to grow, and currently hold $5.3 trillion in assets on behalf of more than 55 million active participants and millions of former employees and retirees.

Read more…

TOPICS: 401(k)Investor ResearchPolicy ResearchRetirement PolicyRetirement ResearchSavingsShareholderTarget Date Funds

Stock Ownership in the United States: It’s Main Street

By Sarah Holden

September 10, 2018

US household activity in the stock market has undergone a transformation over the past three decades. The old idea that investing in the stock market is just for the wealthy is vastly out of date. 

In the late 1980s, less than a third of US households held stocks. Now, a majority do. This growth in stock-owning households has occurred across all income quintiles....

Read more…

TOPICS: Equity InvestingInvestor ResearchRetirement PolicySavingsShareholder

2018 Investment Company Fact Book: Letter from the Chief Economist

By Sean Collins

May 15, 2018

Those of us who wear glasses know that one of the most crucial elements in seeing the world is the right lens. A bad lens warps the light and distorts the signals; the right lens sharpens the image and enhances our understanding.

This is a useful metaphor for the work that ICI Research does in providing informed analysis to guide public policy. Through our voluminous collections and surveys, we gather large amounts of data—signals about the behavior of funds, markets, and investors. But finding the patterns in these signals requires the right lens—accumulated knowledge provided by context, economic insights, and understanding of institutions.

The Investment Company Fact Book is one very visible result of this process and its many elements...

Read more…

TOPICS: Financial MarketsFund RegulationInvestor ResearchMutual FundPolicy ResearchRetirement PolicyRetirement ResearchSavingsShareholder

A More Accurate Evaluation of Retirement Plan Participation

By Miriam Bridges

May 2, 2018

What’s the actual participation rate of Americans preparing for retirement through a workplace retirement plan? It’s an important question, and one that ICI economists Peter Brady and Steven Bass shed some light on in their new analysis of tax data, “Who Participates in Retirement Plans, 2014.”

The retirement plan participation rate—often used to evaluate the performance of the US voluntary employer plan system—understates the true scope and importance of these plans. In their careful analysis, Brady and Bass give two reasons for this understatement...

Read more…

TOPICS: Retirement PolicyRetirement ResearchSavingsTaxes

Americans: In Defined Contribution We Trust

By Sarah Holden

March 8, 2018

Millions of Americans personally direct their retirement investments in defined contribution (DC) plans, which account for nearly $8 trillion in savings. Because it is vitally important that regulators, policymakers, and employers understand the beliefs and behaviors of these investors, ICI asked Americans what they thought of DC retirement plan accounts, which include 401(k) and 403(b) accounts.

The results, which we summarized in “American Views on Defined Contribution Plan Saving, 2017,” were clear: whether they had DC accounts or not, Americans appreciate DC plan accounts and are confident that these plans can help people meet their retirement goals...

Read more…

TOPICS: 401(k)Investor ResearchRetirement PolicyRetirement Research

States Are Abusing Abandoned-Property Funds to Plug Budget Shortfalls

By Tamara K. Salmon

January 11, 2018

Imagine finding out that your investment account has been turned over to your state because it was considered “abandoned.” Imagine, too, that after the account was turned over to the state, the account received a capital gains distribution. As a result, you are liable for paying the taxes on that distribution—and can be assessed monetary penalties for not paying the taxes in a timely fashion.

Read more…

TOPICS: Fund RegulationGovernment AffairsMutual FundRetirement PolicySavingsShareholderTaxes

Let’s Give the US Retirement System the Credit It Deserves

By Sarah Holden

December 27, 2017

The Washington Post’s latest article on the future of retirement security (“‘I Hope I Can Quit Working in a Few Years’: A Preview of the US Without Pensions,” December 23) is not a preview but a retrospective look at some of the challenges that workers face in defined benefit (DB) pension plans even at “blue-chip” firms. As documented in the article, with traditional DB plans, workers often failed to get their full promised benefits, thanks to vesting rules, back-loaded benefit accrual, business failure, and labor mobility. 

Read more…

TOPICS: 401(k)Financial StabilityRetirement PolicyRetirement Research

Congress Must Spike “FIFO” for All Investors

By Paul Schott Stevens

December 8, 2017

As the House and Senate reconcile their differing versions of tax reform, one provision from the Senate’s bill should be deleted immediately. Tax reform must not impose an accounting system known as “first-in, first-out” (FIFO) that would deprive America’s investors of their long-standing ability to manage their finances for the greatest tax efficiency.

Read more…

TOPICS: Fund RegulationGovernment AffairsMutual FundRetirement PolicyTaxesTrading

2017 Annual Report to Members: A Message from the Chairman

By William F. “Ted” Truscott

November 13, 2017

This letter by ICI Chairman Ted Truscott was released in our 2017 Annual Report to Members.

Every day, I’m reminded that each of us in the fund industry is driven to deliver ever-greater value for our fees and keep improving service to fund shareholders. Investors are demanding more from every asset manager—and the resulting competition drives us to innovate, find new efficiencies, and offer even better solutions for investors’ needs.

Read more…

TOPICS: Financial MarketsFinancial StabilityFund RegulationGlobalGovernment AffairsICI GlobalIndex FundInternationalInvestor ResearchMutual FundPolicy ResearchRetirement PolicyShareholder

In Reality, Data Tell a Different Story of Old Age in America

By Sarah Holden

October 10, 2017

 “The New Reality of Old Age in America” (September 30) portrays economic security in retirement by pairing anecdotes about workers who have fared poorly with selected statistics. Comprehensive data on how our system is working overall tell a far different story: America’s retirement system enables most of today’s retirees to maintain their standards of living.

 

Read more…

TOPICS: 401(k)Investor ResearchMutual FundPolicy ResearchRetirement PolicyRetirement ResearchSavingsShareholder

DOL Fiduciary Rule Review Is Opportunity for SEC

By Paul Schott Stevens

August 8, 2017

The following ICI Viewpoints is an op-ed by Paul Schott Stevens that was published in InvestmentNews on August 7, 2017.

Securities and Exchange Commission (SEC) Chairman Jay Clayton deserves credit for his decisive action inviting public feedback on the standards of conduct for financial advisers to retail investors. He now has a critical window of opportunity to press forward and work with the Department of Labor (DOL) to establish a consistent best-interest standard of conduct that applies uniformly across retirement and non-retirement accounts, while preserving investor choice. 

Read more…

TOPICS: Fund RegulationGovernment AffairsMutual FundRetirement Policy

2017 Investment Company Fact Book: Letter from the Chief Economist

By Brian Reid

April 27, 2017

Have you ever tried to put a jigsaw puzzle together without knowing what the finished work should look like? It’s difficult—even with help from family and friends. Are those blue pieces part of a peaceful lake or a cloudless sky? Are those dark pieces a forest floor or storm clouds brewing on the horizon? Without the completed picture on the puzzle box as a guide, everyone has their own idea of what the completed work will look like and how to put it together.

Read more…

TOPICS: Financial MarketsFund RegulationGovernment AffairsInvestor ResearchMutual FundPolicy ResearchRetirement PolicyRetirement ResearchShareholder

Scratch That: Why Arguments of a Broken Retirement System Are Misguided

By Peter J. Brady

April 6, 2017

What if you were given the task of designing a retirement system from scratch? In a recent paper, New York University law professor David Kamin proposes a retirement system that combines a mandatory savings floor with tax incentives to encourage savings above the mandated minimum. He is not the first to propose a new mandatory retirement plan, with others proposing that either employers be required to offer a plan or workers be required to contribute to a plan. 

Read more…

TOPICS: 401(k)Investor ResearchMutual FundRetirement PolicyRetirement ResearchSavings

Exemptions from Investor Protections Put California Savers at Risk

By Paul Schott Stevens

March 22, 2017

The following ICI Viewpoints is a letter to the editor by Paul Schott Stevens, president and CEO of the Investment Company Institute, in response to an editorial published on March 8, 2017, in the Los Angeles Times.

Read more…

TOPICS: 401(k)Investor ResearchMutual FundRetirement PolicyRetirement ResearchSavingsShareholder

For “401(k) Pioneers,” No Reason for Regrets

By Paul Schott Stevens

January 10, 2017

The following ICI Viewpoints is a letter to the Wall Street Journal by Paul Schott Stevens, president and CEO of the Investment Company Institute, in response to an article published on January 3, 2017.

Dear Editor:

It may be, as you report, that “401(k) Pioneers Lament What They Started” (Page A1, Jan. 3). But the facts are clear: America’s retirement system is stronger today, in the expanding 401(k) era, than it was when defined benefit pensions were the primary vehicle for retirement savings.

Read more…

TOPICS: Investor ResearchMutual FundRetirement PolicyRetirement ResearchSavingsShareholder

Ten Years After the PPA, the Path to Retirement Saving Is Easier

By Sarah Holden and Elena Barone Chism

August 22, 2016

Ten years ago, on August 17, 2006, President George W. Bush signed the Pension Protection Act (PPA) into law, with the goal of ensuring greater retirement security for American workers. With regard to defined contribution (DC) plans, such as 401(k) plans, PPA further encouraged automatic enrollment while paving the way for diversified default investments and the creation of Roth accounts inside DC plans. PPA also made permanent previously legislated contribution-limit increases and the saver’s credit.

Read more…

TOPICS: 401(k)Government AffairsInvestor ResearchPolicy ResearchRetirement PolicyRetirement ResearchTaxes

Secure Choice Is Risky for Workers and for the State

By Paul Schott Stevens

August 17, 2016

Millions of Americans save for retirement using employer-sponsored plans that offer tax advantages and excellent investment options.

Read more…

TOPICS: Government AffairsMutual FundRetirement PolicySavings

Building on the Success of the Private-Sector Retirement System Is the Real “Secure Choice”

By David Blass

July 8, 2016

Retirement assets in the United States totaled $24 trillion at the end of 2015, bolstered by investments through employer-sponsored plans and individual retirement accounts (IRAs).

Read more…

TOPICS: 401(k)Fund RegulationGovernment AffairsMutual FundRetirement Policy

How America Supports Retirement: The Incentive to Save Is Not Upside Down

By Peter J. Brady

February 25, 2016

In my new book, How America Supports Retirement: Challenging the Conventional Wisdom on Who Benefits, and the first three ICI Viewpoints in this series, I’ve demonstrated that Social Security’s benefit formula drives participation in tax-deferred employer-sponsored retirement plans ; that the full system of government support for retirement is progressive; and that those in higher tax brackets don’t enjoy greater “bang for their buck” from tax deferral.

Read more…

TOPICS: 401(k)Government AffairsInvestor ResearchPolicy ResearchRetirement PolicyRetirement ResearchTaxes

How America Supports Retirement: What Do Tax Rates Have to Do with the Benefits of Tax Deferral? Less Than You Think

By Peter J. Brady

February 24, 2016

In my new book, How America Supports Retirement: Challenging the Conventional Wisdom on Who Benefits, I set out to gain a comprehensive view of how government policy supports American workers as they gather resources for retirement.

Read more…

TOPICS: 401(k)Government AffairsInvestor ResearchPolicy ResearchRetirement PolicyRetirement ResearchTaxes

How America Supports Retirement: No, Benefits Are Not “Tilted” to the Higher Earners

By Peter J. Brady

February 23, 2016

Second in a series of ICI Viewpoints.

In my new book, How America Supports Retirement: Challenging the Conventional Wisdom on Who Benefits, I analyze the benefits individuals receive from the major government policies that help American workers accumulate resources for retirement: Social Security and tax deferral on compensation set aside for retirement in employer-based plans (both traditional pensions and defined contribution plans, such as 401(k) plans).

Read more…

TOPICS: 401(k)Government AffairsInvestor ResearchPolicy ResearchRetirement PolicyRetirement ResearchTaxes

How America Supports Retirement: Tackling the Myths That Surround Us

By Peter J. Brady

February 22, 2016

America’s retirement system isn’t perfect but it’s a lot stronger than many people think. Whether by accident or design, the U.S. retirement system provides benefits to workers across the earnings distribution and has helped millions of retirees maintain their standard of living in retirement.

Read more…

TOPICS: 401(k)Government AffairsInvestor ResearchPolicy ResearchRetirement PolicyRetirement ResearchTaxes

Retirement Planning: No Place for Fairy Tales

By Paul Schott Stevens

November 17, 2015

It is sadly appropriate that Labor Secretary Thomas Perez invokes fairy tales in his Nov. 16 commentary, “A path forward for state retirement plans.” Neither his version of the past nor his program for the future accord with reality.

Read more…

TOPICS: 401(k)Fund RegulationGovernment AffairsMutual FundRetirement Policy

Correcting a Distorted Picture of Retirement Resources

By Peter Brady

October 21, 2015

Can 401(k) plans and individual retirement accounts (IRAs) provide the income that retirees need to supplement Social Security and enjoy a secure retirement? 

Read more…

TOPICS: EventsGovernment AffairsInvestor ResearchPolicy ResearchRetirement PolicyRetirement ResearchSavings

Small Savers at a Loss

By Brian Reid and Sarah Holden

September 25, 2015

As ICI has pointed out before, the proposed rule from the Department of Labor (DOL) to redefine what counts as a fiduciary relationship in the retirement market is fundamentally flawed. But it is no less flawed than the DOL’s justification for it—a Regulatory Impact Analysis that fails to demonstrate a market failure that supports the need for such a sweeping and costly rule.

Read more…

TOPICS: Government AffairsInvestor ResearchPolicy ResearchRetirement PolicyRetirement ResearchSavings

Opinion: The Tax Threat to Your Mutual Fund

By Mike McNamee

May 7, 2015

Vanguard Chairman and CEO Bill McNabb sent “an open letter to all mutual fund investors” in the opinion pages of Thursday’s Wall Street Journal. His message: fund investors face a clear threat of higher costs, weaker returns, and a bailout tax to salvage other failing financial institutions—all if regulators get their way in imposing new rules on funds or their managers.

Read more…

TOPICS: 401(k)Federal ReserveFinancial MarketsFinancial StabilityFund RegulationMutual FundRetirement PolicySavingsShareholderTradingTreasury

On Fiduciary Rule, New York Times Relies on Fatally Flawed Research

By Paul Schott Stevens

April 8, 2015

Today I submitted the following letter to the editor of the New York Times:

Read more…

TOPICS: 401(k)Fund RegulationInvestment EducationRetirement PolicySavingsShareholder

Getting the Numbers Right on Investment Advice for Retirement Savers

By Brian Reid

February 26, 2015

As the Wall Street Journal noted this morning, ICI has deep concerns about the data used in a White House memorandum to support the Department of Labor’s push for tighter standards for financial advisers who help investors in employer plans—such as 401(k)s—and individual retirement accounts (IRAs).

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TOPICS: Government AffairsMutual FundRetirement PolicyRetirement Research

What’s Driving Retirement Plan Access?

By Peter Brady

October 17, 2014

Most workers who are likely to have the ability to save and who are focused primarily on saving for retirement have access to an employer-sponsored retirement plan—and nearly all of these workers choose to participate.

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TOPICS: Government AffairsInvestor ResearchPolicy ResearchRetirement PolicyRetirement ResearchSavings

Statement of the Investment Company Institute at Senate Finance Committee Hearing on “Retirement Savings 2.0: Updating Savings Policy for the Modern Economy”

By Brian Reid

September 16, 2014

This statement was given on behalf of ICI by Brian Reid, chief economist, at the Senate Finance Committee’s hearing on “Retirement Savings 2.0: Updating Savings Policy for the Modern Economy.” For more information, see ICI’s full written testimony.

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TOPICS: 401(k)Government AffairsInvestor ResearchMutual FundRetirement PolicyRetirement ResearchSavingsTaxes

Happy Birthday ERISA! Congratulations on 40 Years

By Sarah Holden and Elena Barone Chism

September 2, 2014

Today marks the 40th birthday of the Employee Retirement Income Security Act (ERISA). Signed into law on September 2, 1974, ERISA introduced bold steps to safeguard Americans’ employer-sponsored pensions and created the individual retirement account (IRA). Assets earmarked for retirement totaled $0.4 trillion at year-end 1974 (see the figure below). At this modest start, private-sector defined benefit (DB) plans accounted for 35 percent of the total; federal, state, and local plans for 34 percent; private-sector defined contribution (DC) plans for 17 percent; annuities for 13 percent; and there was a mere glimmer of IRA assets by year-end. Currently, total U.S. retirement assets are $23.0 trillion, and their composition has shifted considerably over the past 40 years.

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TOPICS: 401(k)Fixed IncomeGovernment AffairsInvestment EducationInvestor ResearchPolicy ResearchRetirement PolicyRetirement ResearchSavingsTaxesTreasury

Unconventional Wisdom on Retirement Preparedness

By Peter Brady

August 4, 2014

How well are Americans planning and saving for retirement? This is an important question to answer—but also vexingly difficult.

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TOPICS: EventsGovernment AffairsInvestor ResearchPolicy ResearchRetirement PolicyRetirement ResearchSavings

Industry Leaders Address Evolving Industry Challenges and Opportunities

By Miriam Bridges

June 9, 2014

In conversations exploring outcome-oriented investing, the globalization of the fund industry, and the next generation of retirement plans, industry leaders offered their perspectives on serving investors in an evolving world during several insightful sessions at ICI’s annual General Membership Meeting, held in Washington May 20–22.

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TOPICS: 401(k)EventsGMMInternationalMutual FundRetirement PolicySavingsShareholder

Now Off the Hill, Senator Snowe Still Brimming with Ideas, Advice

By Rob Elson

June 5, 2014

U.S. policy is ripe for reform in a number of key areas, but changes to ease the polarized political environment must come first, former U.S. senator Olympia Snowe (R-ME) told the crowd during the final session of ICI’s 56th annual General Membership Meeting (GMM), held May 20–22 in Washington, DC.

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TOPICS: CybersecurityEventsFederal ReserveFinancial MarketsFinancial StabilityFund RegulationGMMGovernment AffairsMutual FundRetirement PolicyShareholderTreasury

Industry Leaders Reflect on Serving Investors in an Evolving World

By Christina Kilroy

June 4, 2014

Speaking on the Leadership Panel held Wednesday, May 21, at ICI’s General Membership Meeting (GMM), fund industry leaders agreed that challenges as well as opportunities abound for their businesses in today’s complex world.

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TOPICS: 401(k)EventsFederal ReserveFinancial MarketsFinancial StabilityFund GovernanceFund RegulationGMMGovernment AffairsInvestment EducationMutual FundRetirement PolicyShareholder

GMM Policy Forum: BlackRock’s Larry Fink Speaks with ICI’s Paul Stevens

By Todd Bernhardt

May 21, 2014

The fund industry needs to stop focusing on the moment and start focusing on outcomes when advising investors on their resources, said Laurence D. Fink, chairman and CEO of BlackRock, at ICI’s Annual Policy Forum, part of the Institute’s 56th General Membership Meeting (GMM).

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TOPICS: 401(k)BondsEventsFinancial MarketsFund RegulationGMMInternationalInvestment EducationMutual FundRetirement PolicySavingsShareholderTreasury

Washington: Put Your (Retirement) Money Where Your Mouth Is

By Mike McNamee

March 4, 2014

When President Obama announced a new effort to expand access to retirement savings opportunities, ICI was among the first to applaud. The Administration’s “myRA” looks to provide a new option for Americans who want to put money aside for retirement, but who might not have access to a retirement plan through their workplace. These accounts would complement the wide array of investment options already available to these workers.

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TOPICS: 401(k)Government AffairsInvestment EducationRetirement PolicySavingsTaxes

The Status of Global Retirement Savings: Taking Stock, Moving Forward

By Dan Waters

December 20, 2013

Around the world, as systems for building retirement resources come under increasing pressure, countries of every size and economic situation are facing long-term savings challenges. To meet these challenges, it is critical that pension industry experts, policymakers, and fund industry representatives learn from one another and share solutions that put the needs of savers first.

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TOPICS: EventsICI GlobalInternationalRetirement PolicyRetirement Research

America’s Retirement System Is Strong

By Sarah Holden

December 18, 2013

One year ago, ICI released its landmark study, The Success of the U.S. Retirement System, a compilation of research from a wide range of sources, which found that the country’s retirement system is fostering economic security in retirement for Americans across all income levels.

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TOPICS: 401(k)Investment EducationMutual FundRetirement PolicySavingsShareholderTaxes

ICI’s Guide to Avoiding a Common 401(k) Tax Trap

By Mike McNamee

December 9, 2013

A tax trap for retirement savings is catching many smart people unaware. If allowed to go unchecked, it could harm the retirement savings of millions of Americans. A columnist for the Washington Post was just the latest in a long list of victims. 

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TOPICS: 401(k)Investment EducationMutual FundRetirement PolicySavingsShareholderTaxes

Revenue Estimates of Restricting Tax Deferral: It Ain’t Necessarily So

By Peter Brady

September 20, 2013

Fifth in a series of posts about retirement plans and the policy proposals surrounding them.

In previous Viewpoints posts, I explained that retirement contributions are neither tax deductions nor tax exclusions, but rather are tax deferrals. I also explained why, in my opinion, the two most prominent proposals to restrict qualified deferred compensation are flawed (post three and post four).

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TOPICS: 401(k)Investment EducationMutual FundRetirement PolicySavingsShareholderTaxes

Tax Reforms Should Not Favor DB Plans over DC Plans

By Peter Brady

September 19, 2013

Fourth in a series of posts about retirement plans and the policy proposals surrounding them.

In The Tax Benefits and Revenue Costs of Tax Deferral and in two previous Viewpoints posts (post one and post two), I explained the benefits that workers get from deferring tax on compensation set aside for retirement.

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TOPICS: 401(k)Investment EducationMutual FundRetirement PolicySavingsShareholderTaxes

A ‘Modest’ Proposal That Isn’t: Limiting the Up-Front Benefits of Retirement Contributions

By Peter Brady

September 18, 2013

Third in a series of posts about retirement plans and the policy proposals surrounding them.

In two previous Viewpoints posts (post one and post two), I explained the benefits that workers get from deferring tax on compensation set aside for retirement. 

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TOPICS: 401(k)Investment EducationMutual FundRetirement PolicySavingsShareholderTaxes

Marginal Tax Rates and the Benefits of Tax Deferral

By Peter Brady

September 17, 2013

Second in a series of posts about retirement plans and the policy proposals surrounding them.

In a previous Viewpoints post, I discussed the difference between tax deferral—the tax treatment applied to retirement savings—and tax deductions and exclusions, such as the mortgage interest deduction or the exclusion of employer-paid health insurance premiums from income. The difference is often overlooked or misunderstood, leading to inaccurate analysis and harmful policy proposals.

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TOPICS: 401(k)Investment EducationMutual FundRetirement PolicySavingsShareholderTaxes

Retirement Plan Contributions Are Tax-Deferred—Not Tax-Free

By Peter Brady

September 16, 2013

First in a series of posts about retirement plans and the policy proposals surrounding them.

In today’s fiscal and political climate, taxes are never far from politicians’ minds. Whether to achieve comprehensive tax reform or to raise revenue to meet budget deficits, members of Congress are now considering changes to a range of tax code provisions—including those governing retirement policy. Any comprehensive effort to address fiscal policy or tax reform should examine every option, but some discussions of retirement policy have been misguided. The tax treatment of retirement savings—tax deferral— too often has been lumped together with tax deductions (such as the deduction from income of mortgage interest expense) and tax exclusions (such as the exclusion from income of employer-provided health insurance premiums).

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TOPICS: 401(k)Investment EducationMutual FundRetirement PolicySavingsShareholderTaxes

CAP Claims About the 401(k) System Are Misguided

By Paul Schott Stevens

September 4, 2013

The concerns of the Center for American Progress about the 401(k) system (covered August 20 in “A Better Way to Save for Retirement?”) are mistaken.

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TOPICS: 401(k)Retirement PolicyRetirement ResearchSavings

In Case You Missed It: “A Three-Step Approach to Global Retirement Challenges”

By Stephanie Ortbals-Tibbs

May 8, 2013

Investment & Pensions Asia has just posted a commentary from Dan Waters, ICI Global’s managing director.

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TOPICS: ICI GlobalRetirement Policy

Americans Support Their 401(k)s

By Mike McNamee

April 25, 2013

It’s pretty obvious to anyone who reads ICI Viewpoints that we believe 401(k) plans are a successful part of an overall retirement system that is working for working—and retired!—Americans. But we’re far from the only ones who think so. Surveys show that Americans share this confidence in the 401(k) and support the key features of 401(k)s and other defined contribution (DC) plans.

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TOPICS: 401(k)Retirement PolicyRetirement Research

The Facts on Fees and 401(k)s

By Mike McNamee

April 23, 2013

Consistently falling prices in a marketplace are usually a sign of competition and innovation.

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TOPICS: 401(k)Retirement PolicyRetirement Research

The Facts on Limited Access to Retirement Funds Before Retirement

By Mike McNamee

April 22, 2013

One of the many strengths of the 401(k) system is its flexibility. Policymakers have built into 401(k) plans a careful mix of incentives that help workers save and preserve their savings for retirement—while still allowing limited access to their funds, in case of need, through hardship withdrawals and loans.

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TOPICS: 401(k)Retirement PolicyRetirement Research

401(k) Plans Work in a Balanced Approach to Retirement Security

By Mike McNamee

April 19, 2013

What’s the outlook for American workers looking forward to retirement?

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TOPICS: 401(k)Retirement PolicyRetirement Research

No Accident: The Strengths of the 401(k) System

By Mike McNamee

April 18, 2013

Americans have saved $5.1 trillion dollars in 401(k) and other defined contribution (DC) retirement plans—plus another $5.4 in individual retirement accounts (IRAs) that are funded largely by assets rolled over from DC and other employer retirement plans.

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TOPICS: 401(k)Retirement PolicyRetirement Research

IRA Rollovers Serve Investors Well

By David Abbey and Sarah Holden

April 12, 2013

The U.S. Department of Labor (DOL) is preparing to reintroduce its controversial proposal to revise the long-standing definition of “fiduciary” under the Employee Retirement Income Security Act (ERISA).

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TOPICS: 401(k)Retirement PolicyRetirement Research

In Case You Missed It: “On Retirement Policy, Don't Mess with Success”

By Ianthé Zabel

January 28, 2013

In an op-ed for InvestmentNews, ICI President and CEO Paul Schott Stevens explains the importance of preserving incentives that help Americans save for retirement.

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TOPICS: 401(k)Retirement Policy

401(k) Plans: Key in Helping Americans Achieve Secure Retirement

By Paul Schott Stevens

September 19, 2012

I submitted the following letter to the New York Times in response to a recent column on 401(k) plans:

The recent article, “Should the 401(k) be Reformed or Replaced” (Business Day, September 11), asks the wrong question.

401(k) plans play a key role in helping Americans achieve a secure retirement. 401(k)s have a remarkable track record of success in providing Americans incentives to save, invest, and think long-term. As of March 2012, Americans held $3.4 trillion in 401(k) plans.

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TOPICS: 401(k)Retirement Policy

Fortune’s Assessment of Industry Stance on 401(k) Fees Is Misguided

By Sarah Holden and David Abbey

June 25, 2012

An article in the July 2 issue of Fortune about the 401(k) system mischaracterizes 401(k) fees and requires correction.

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TOPICS: 401(k)Retirement Policy

The Future of Retirement and the Strengths of the 401(k) System

By Paul Schott Stevens

June 7, 2012

What is the future of retirement? In remarks today to Town Hall Los Angeles, I made the case that the 401(k) system will play a crucial role in building that future.

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TOPICS: 401(k)Retirement Policy

Facts and Common Sense Undercut Distorted Demos View of 401(k)s

By Brian Reid

May 31, 2012

By many measures, the 401(k) system has been a tremendous success, helping millions of American workers prepare for retirement.

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TOPICS: 401(k)Retirement Policy

An Important Step in the Process of Enhancing 401(k) Fee Disclosure

By Ianthé Zabel

February 3, 2012

On February 2, the Department of Labor (DOL) issued final regulations concerning 401(k) disclosures. The rule requires companies that administer defined contribution plans to disclose administrative and investment costs to employers who sponsor the plans.

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TOPICS: 401(k)Retirement Policy

New York Times Editorial Misrepresents the Behavior of 401(k) Investors

By Brian Reid

August 23, 2011

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TOPICS: 401(k)Retirement PolicyRetirement Research

401(k) Plans Help Keep Americans on Track

By Paul Schott Stevens

August 1, 2011

ICI sees strong evidence that the features of 401(k) plans help Americans avoid overreaction to financial turmoil, by countering extremes in investor behavior that hard times often produce.

This was one of the key points that I made recently at the Ayco Summer InnerCircle Benefits and Compensation Conference in Saratoga Springs, New York. I invite you to look over my full presentation, which contains a trove of data and charts pertinent to retirement policy.

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TOPICS: 401(k)Retirement Policy

The Comprehensive Regulatory Framework Around IRAs

By Mary S. Podesta and Elena B. Chism

July 28, 2011

We occasionally encounter the puzzling misperception that individual retirement accounts (IRAs) are under-regulated—as in this recent Wall Street Journal story.

The truth is, IRA investors benefit from a comprehensive regulatory framework, one that governs the IRA itself, IRA providers, and, in most cases, the investments that are held within the account.

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TOPICS: Retirement Policy

Numbers Show the Success of Automatic Enrollment

By Paul Schott Stevens

July 7, 2011

A July 7 story in the Wall Street Journal makes the assertion that a recently-enacted 401(k) law “suppresses” retirement savings. The assertion rests on faulty data interpretation. Look at the proper numbers, and the truth becomes clear—the 401(k) system, thanks in part to reforms brought about by the law, known as the Pension Protection Act of 2006, in fact promotes and increases retirement saving.

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TOPICS: Retirement Policy

DOL Should Allow E-Delivery as Default for Plan Communications, Says ICI

By Anna Driggs

June 17, 2011

Given dramatic changes in technology over the last decade, the Department of Labor (DOL) should allow retirement plans to make e-delivery the default method for communicating plan information, ICI said in a recent comment letter. E-delivery will enhance communication and improve the security and privacy of personal and account information.

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TOPICS: Retirement Policy

Let’s Set the Record Straight on 401(k)

By Paul Schott Stevens

April 13, 2011

As states and localities struggle to control their budgets, more and more policymakers are considering fundamental changes in the retirement plans offered to public employees. This year, at least eight states have taken up legislation to change part or all of their public retirement plans from traditional defined benefit (DB) pensions to defined contribution (DC) plans similar to the 401(k)s that that are now the most common plans in the private sector. Many more public employers are likely to consider such changes in coming years.

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TOPICS: 401(k)Retirement Policy

The Facts on Mutual Funds and Securities Lending

By Michael L. Hadley, Tamara K. Salmon, and Gregory M. Smith

March 18, 2011

Recent stories in the press have addressed the issue of securities lending, particularly in the context of 401(k) plans. For example, a March 16 story in the Wall Street Journal (“Disclosure Sought on Fund Lending”) suggests that securities lending’ in 401(k) plans “prevented some employers and investors from withdrawing their money during the financial crisis.”

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TOPICS: Retirement Policy

For the Sake of Retirement Savers, ERISA Rules Defining “Fiduciary” Need Clarity

By Paul Schott Stevens

March 3, 2011

Fiduciary status entails one of the highest obligations known to the law. Essentially, a fiduciary is one who takes it upon himself or herself to act for or advise another, thus inviting the other’s confidence and trust.

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TOPICS: Retirement Policy

ICI Urges Caution on DOL Fiduciary Duty Proposal

By Mary S. Podesta

February 4, 2011

When is a person a fiduciary by virtue of providing investment advice to a retirement plan or its participants? That’s the question we addressed in a letter filed yesterday with the Department of Labor (DOL), which issued a proposal last October to revise its interpretation of the definition of “fiduciary” under the Employee Retirement Income Security Act (ERISA).

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TOPICS: Retirement Policy

Candor, Compromise, and Equity Must Guide Policymakers as They Meet Challenges of Aging Societies

By Paul Schott Stevens

November 29, 2010

In London today, at a hearing room of the House of Commons, I addressed The Henry Jackson Society, a nonpartisan think tank focused on human rights, constitutional democracy, and institutional reform.

Read more…

TOPICS: Retirement Policy

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