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P-Solve Monthly Retirement Update

February 2018

Key Takeaways:

✔ January produced funded status improvements.

✔ Discount rates popped right back up to where they were at the end of October and November of 2017 rising almost 0.20% in January.

✔ Equities posted another strong month with significant one-month gains in US, international, and emerging market asset classes.

January 2018 Summary

Between an uptick in discount rates and strong equity performance, plan sponsors should see a nice bump in funded status as of the end of January. Discount rates recovered from the dip they took at the end of December. Equities had a solid month with US and international equities up around 5% and emerging markets over 8%.

Discount Rates & Asset Returns

Discount rates bounced right back up from where they ended 2017 with the Citi Pension Index up nearly 0.20% during January. This puts current rates at similar levels to where they were most of the second half of 2017.

Global equities continued to advance on sustained strong global fundamentals, stimulus, and momentum. US and International Developed Equities both returned around 5% while Emerging Markets gained 8.3%. Most US fixed income mandates faced losses in January with interest rates rising across the yield curve.

What’s New at P-Solve?

Plan Termination Preparation 

We have recently launched a new plan termination section of our website. The section contains useful information for plan sponsors that are considering terminating their pension plans. In order to successfully terminate a plan there is a lot of preparation work that can be done to ensure a smooth journey once the termination process has started. For articles, insights, and to receive your plan termination readiness assessment click here.

Managing Equity Risk in 2018

The bull market in US equities continues and approaches its 9 year anniversary – the second longest since WWII.  In 2018, many investors face an uncomfortable dilemma.  Past gains can be locked in from a position of relative strength but strong economic conditions and the desire to outperform bonds mean many will also wish to stay invested. Click here to learn more about what you can do to manage equity risk in your portfolio.

Ask P-Solve!


If I’m considering purchasing annuities for my pension plan participants in 2018, when is the optimal time?


The annuity purchase market has been on a rampage the last five years. It’s clear from looking at annuity purchase data that Q3 and Q4 are the busiest times for insurers. If you are considering an annuity purchase in 2018, your best bet is to transact in Q2 or early Q3. At a minimum you will want to get your information to the insurers well in advance of the second half of the year to ensure that you get the maximum number of insurers to bid on your case.


SECURITY INDICES: This presentation includes data related to the performance of various securities indices.  The performance of securities indices is not subject to fees and expenses associated.  Investments cannot be made directly in the indices.   The information provided herein has been obtained from sources which P-Solve LLC believes to be reasonably reliable but cannot guarantee its accuracy or completeness

CONFIDENTIAL:  For addressee use only, not to be disclosed to any other person without express consent from P-Solve LLC.  Past performance cannot be relied upon to predict future results.  P-Solve LLC is an investment advisor registered with the US Securities and Exchange Commission.