Deals & People March 4, 2016

Retirement Industry People Moves

New hires, promotions and deals at Delaware Investments,  RTD Financial Advisors,  SEI  and more.
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A team of international growth equity investors has joined Macquarie Group’s Delaware Investments from UBS Asset Management.

Based in San Diego, California, and led by Joseph Devine, the chief investment officer, the team specializes in international small-cap, emerging markets, and emerging markets small-cap equities, and reports bringing approximately $300 million in assets (as of March 1) under management to Delaware Investments.

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“This team is a strong fit with our multi-boutique platform and plays an important role in meeting the needs of clients seeking more global exposure and active management in inefficient markets,” says Shawn Lytle, president, Delaware Investments.

Most of the team’s members have been together for more than 10 years. Other members are: senior portfolio manager Stephan Maikkula; senior equity analysts Barry Kendall and Thomas Pak; equity analyst James Brandt, and portfolio analyst Jay Su Erickson. Devine will report to Lytle.

Delaware Investments, a member of Macquarie Group, is a global asset management firm.

NEXT: RTD Financial Advisors acquires Pinnacle Financial Advisors.

RTD Financial Advisors Inc. (RTD), a Philadelphia firm, has acquired Pinnacle Financial Advisors LLC of Marlton, New Jersey, and Bala Cynwyd, Pennsylvania.

The combined firm will have 34 employees with over 45 professional designations, including 16 Certified Financial Planner (CFP) practitioners and six who hold masters of business administration degrees. The firm will manage more than $1 billion in private client and company retirement plan assets.

Richard J. Busillo, chairman and chief executive of RTD, says Pinnacle’s culture and focus align perfectly with RTD’s. The firms also share a similar investment approach and philosophy.

Pinnacle’s principals are Harry Scheyer and Jeff Metz.

NEXT: SEI names new head of North American institutional sales.

Michael Cagnina has joined SEI as vice president and managing director of North American sales for the institutional group.

Cagnina will oversee new business development for the institutional market segments in the U.S. and Canada, including corporate defined benefit and defined contribution plans, multiemployer plans, public pension plans, health care organizations and nonprofit foundations, and endowments.

Cagnina, who has been with SEI for 24 years, replaces Paul Klauder who was named executive vice president of SEI and head of the institutional group in January, after Edward Loughlin’s retirement. Cagnia worked alongside Klauder for 22 years in the institutional group. 

Previously, Cagnina was a managing director of the institutional group's Chicago office, where he fostered new business relationships with large institutional investors across the country. Before joining the division, Cagnina worked for SEI Capital Resources in portfolio analysis and client service.

NEXT: RiskFirst creates leadership team for strategic direction.

A new leadership team, led by chief executive officer Matthew Seymour, has been assembled at RiskFirst.

Seymour has been with RiskFirst since 2009, most recently as commercial director. He has 17 years’ experience in the technology industry, 14 years in FinTech (financial technology). Before coming to RiskFirst, he was co-owner and chief technology officer of FundWorks, a global FinTech serving the investment management industry.

Matthew Bale, chief strategy officer on the team, joined RiskFirst in 2009. Previously, he worked in both the actuarial and investment arenas, most recently in Citi’s insurance and pensions structured solutions group. His experience has guided the evolution of PFaroe into consulting and asset management.

Darren Best, the team’s chief financial officer, came to RiskFirst in 2008. Previously, he  was a qualified actuary, advising on pension fund design, management and reporting, both in the U.K and U.S.

The chief technology officer, Nick Francis, moved to RiskFirst in 2009, after 17 years as technical director of his own technology consultancy, running large projects for blue-chip companies in the U.K. and Europe.

Rob Stuart, general counsel, joined RiskFirst in 2009. Previously, he was an in-house lawyer for a London hedge fund, and general counsel for a multinational insurance and reinsurance company.

With experience in financial services, and the actuarial and technology industries, the team will set the company’s future strategic direction, drive growth into new markets and maintain the U.S. and U.K. standing of PFaroe, the risk management platform for the pension industry.

Data & Research March 3, 2016

Income Groups Show Wild Variance in Retirement Savings

Retirement wealth has not grown fast enough to keep pace with an aging population and other changes.
Reported by

“The State of American Retirement,” a paper from the Economic Policy Institute, looks at the retirement prospects of working-age families, focusing especially on retirement account savings.

According to Monique Morrissey, an economist with the Institute, retirement wealth has grown nearly twice as fast as income since 1989, an initially encouraging picture. In 2013, the author examined increasingly inadequate savings and retirement income.  

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Aggregate retirement wealth (assets in pension funds plus savings in retirement accounts) nearly doubled as a share of personal disposable income between 1989 and 2014, even as rising inequality worsened retirement insecurity for most families, Morrissey says.

A more finely shaded look shows that retirement account savings have exceeded defined benefit (DB) assets since 2012, as well as briefly in the late 1990s and mid-2000s. The rise of retirement accounts for individuals is significant since these account assets are more affected by economic downturns than pooled pensions. Contributions are voluntary, and funds may be withdrawn in hard times. In addition, individual retirement account investments are less diversified and investment returns more volatile.

That shift away from traditional pensions has widened retirement gaps, Morrissey contends, and disparities in retirement savings balances have increased. High income, white, college-educated and married workers participate in DB plans at a higher rate than other workers. Participation gaps are much larger under defined contribution (DC) plans.

Economic downturns increasingly have a negative impact on workers’ retirement prospects, according to Morrissey’s findings. Much of the 401(k) era coincided with rising stock and housing prices that propped up family wealth measures even as the savings rate declined. This economic situation reversed in 2000 and 2001, when the tech stock bubble burst, and again in 2007 to 2009, with the financial crisis.

NEXT: How the financial crisis affected retirement savings

In 2013, most families still had not recovered their losses from the financial crisis and Great Recession, let alone accumulated additional savings for retirement. Using data from the Federal Reserve Board’s Survey of Consumer Finances, Morrissey shows a widening gap between the retirement haves and have-nots since the recession.

Nearly half of working-age families have nothing saved in retirement accounts, and the median working-age family had only $5,000 saved in 2013. Meanwhile, the 90th percentile family had $274,000, and the top 1% of families had $1,080,000 or more. These huge disparities reflect a growing gap between haves and have-nots since the Great Recession as accounts with smaller balances have stagnated while larger ones rebounded.

One issue: participation in retirement savings plans is highly unequal across income groups. In 2013, nearly nine in 10 families in the top-income fifth had retirement account savings, compared with fewer than one in 10 families in the bottom-income fifth.

Morrissey concludes that savings and retirement income for successive generations of Americans are increasingly inadequate, and that disparities by income, race, ethnicity, education, and marital status are also growing. By some measures, women are narrowing gaps with men, but still remain more vulnerable in retirement because of lower lifetime earnings and longer life expectancies.

“The State of American Retirement” can be downloaded from the website of the Economic Policy Institute, an independent, nonprofit research group that analyzes the impact of economic trends and policies on working people in the U.S. 

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