Products December 11, 2012

Lower Investment Minimums and Costs at Fidelity

Fidelity Investments dropped the investment minimums for 22 equity, fixed-income and enhanced index funds.
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Effective January 1, 2013, Fidelity also will reduce total net expenses on eight of its Spartan Index funds:  Spartan 500 Index Fund, Spartan Total Market Index Fund, Spartan Emerging Markets Index Fund, Spartan Global ex U.S. Index Fund, Spartan Mid Cap Index Fund, Spartan Real Estate Index Fund, Spartan Small Cap Index Fund and Spartan U.S. Bond Index Fund.   

For Fidelity’s 14 Spartan index funds, the Investor Class investment minimum will be lowered from $10,000 to $2,500, while the Fidelity Advantage Class will be lowered from $100,000 to $10,000.The Investor Class and Fidelity Advantage Class are retail share classes available to retail investors and retirement plans.   

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Investment minimums also were lowered for eight other Fidelity funds from $10,000 to $2,500. Those funds are the Fidelity Four-in-One Index Fund, Nasdaq Composite Index Fund, International Enhanced Index Fund, Large Cap Core Enhanced Index Fund, Large Cap Growth Enhanced Index Fund, Large Cap Value Enhanced Index Fund, Mid Cap Enhanced Index Fund and Small Cap Enhanced Index Fund.

Data & Research December 11, 2012

Workers Anticipate Better Finances in 2013

While nearly two-thirds of American workers view the economy as unhealthy, the percentage of employees who believe it will improve in 2013 has increased.
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According to the fourth quarter “Principal Financial Well-Being Index: American Workers,” 43% of workers anticipate economic improvements next year, up from just 32% last quarter. Despite their confidence in the state of the economy in 2013, more employees (42%, up from 32% last quarter) are stressed about the economy, but fewer workers (36%) are stressed about their personal finances than last quarter (42%).  

Workers surveyed reported their worst financial blunders of 2012 were not saving enough (21%), accumulating credit card debt (13%) and not budgeting properly (10%). Their top financial resolutions for the new year are saving a set amount per month (29%), paying off credit card debt (27%) and cutting monthly spending (21%).  

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Compared with last quarter, more employees (71%, up from 65%) are very concerned about their long-term financial future. Three-quarters of Baby Boomers (75%) are very concerned about their long-term financial future and are the generation most likely to be concerned (64% of Gen Y; 72% of Gen X).

Two in five employees (43%) believe they are making good progress toward achieving their long-term financial goals. One-third of employees (32%) indicate they have not yet planned for their retirement savings/security. Nearly four in 10 employees who do not use a financial professional (36%) have not yet planned for retirement savings/security compared with 19% of employees who do use a financial professional.   

Forty-two percent of Gen Y employees have not yet planned for retirement savings/security, compared with 33% of Gen X employees and 24% of Baby Boomer employees. Only one-third of employees (35%) believe they will be financially prepared for a comfortable retirement. Nearly half of employees who use a financial professional (46%) feel they will be prepared for a comfortable retirement compared to 31% of employees who do not use a financial professional.  

For more than half of employees (53%), the biggest perceived threat to their retirement is insufficient retirement savings. Almost half of employees (48%) feel reductions in Social Security threaten their retirement, while one-third (34%) think reduced Medicare benefits is a threat. Fewer employees this year feel their retirement is threatened by market volatility (30%) and the use of retirement savings before retirement (16%).  

The full report can be downloaded from http://www.principal.com/wellbeing/.

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