Retirement Recap 2016: DOL, Boosting Retirement Savings, Financial Wellness, and More

With Brexit, the DOL Fiduciary Rule, and an unexpected presidential election, 2016 was filled with unprecedented political and regulatory change. Because so much happened in the last year, it’s a good time to take a moment to highlight some key events and research on retirement savings and benefits from the past year, and to provide you with resources that may help your business and employees in the new year:

1) DOL Fiduciary Rule

Earlier this year, the U.S. Department of Labor issued its final rule to expand the fiduciary definition to protect and advance investor interests. The key takeaway? Those providing advice on retirement accounts need documentation showing that investment decisions were made in the client’s best interest.

For more details on the rule, read this short article by Scott Cooley, Director of Research for Morningstar, Inc, and check out our post from October: “5 Steps to Prepare for the DOL Fiduciary Rule” for tips and a full recording of our webinar with Groom Law about the DOL’s ruling from a plan sponsor perspective.

2) The Impact of Default Decisions on Employee Retirement Savings

David Blanchett, Head of Retirement Research at Morningstar Investment Management LLC, completed his research on the impact default retirement solutions, specifically managed accounts and target-date funds, may have on employee savings. It turns out that employees defaulted into managed accounts may save more. Decisions about default savings rate and default plan features may also affect employee savings. To find out just how much these decisions matter, check out this infographic on plan defaults.

3) Retirement Benefits That May Help Employees Retire Better

We all know the challenges we face with retirement. Employees typically aren’t preparing enough for it and employers often aren’t sure whether or not they can do anything to make a difference. We think employers can help by choosing a retirement solution that’s appropriate for their employees’ demographics. As a result, we created a short series of posts to evaluate three options that differ on their level of customization: target-date funds, custom target-date funds, and managed accounts. Click on each of the options to read our evaluations and determine which one may potentially be a good fit for your employees.

4) Student Loans vs. Retirement Savings

With many young workers graduating with increasingly larger debt, there’s little guidance on how these workers should prioritize paying off student loans ahead of schedule and saving for retirement. We completed research in early spring on the effect student loans may have on retirement savings and found out that there were very few circumstances in which paying down loans ahead of schedule resulted in higher net wealth at retirement. Read more about the study and the results here.

5) Financial Wellness

Financial wellness has been and will continue to be an important topic in the realm of helping employees reach better retirement outcomes. These programs can help participants understand the value of good financial habits as the foundation of retirement savings. If you’re curious about adopting financial wellness tools for your employees, download this guide for employers.


This retirement recap highlights just a few of the larger events and research results of 2016. Check out the rest of our retirement posts for more tips on helping employees potentially retire better. Additionally, if you’re a retirement professional and would like to stay up to date on the latest research, webinars, and industry reports, we invite you to subscribe to Morningstar’s Retirement Insights quarterly newsletter.

Lacey is the team lead focused on B2B demand generation for Morningstar’s growing Workplace segment. This includes responsibility of marketing strategy and execution with plan sponsors and key providers to expand Morningstar’s market reach. The Workplace umbrella includes financial wellness and retirement products for employees as well as custom models and fiduciary services. With products, services and thoughtful marketing, we strive to empower companies to help employees build financial wellness today and get ready to retire when the time comes.

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