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NAGDCA Conference 2019 Summary of Conference Sessions Page 4 of 8

Required, however, a holistic approach to the entire process ensures a better long-term provider-partner fit for
the governmental plan provider.

HOW DB PLAN PRESSURES IMPACT DC PLANS
This session reviewed the current state of governmental DB plans and the role DC plans may play in the
future, including a review of the various types of hybrid plans that are in place and/or under consideration.

The overview of the current retirement plan landscape provides a sharp contrast between governmental and
private sector employers. Among the private sector, DB plan make up about one-third of the total assets in
that space – $3 trillion for DB vs. $6 trillion for DC. In the governmental sector the numbers are vastly different
– $4 trillion for DB vs. $0.5 trillion for DC.

With the current pressures impacting pension plans – i.e., contribution volatility, capital market returns,
actuarial impacts, plan design and headlines – pension plan sponsors are looking for ways to mitigate the
financial impact of such plans but still enable their employees with the opportunity to retire with financial
security. As a result, many sponsors are moving towards a hybrid plan approach which is intended to shift
some of the risk from the sponsor to the employee, yet still get them to the point where they can retire
comfortably.

LEVERAGING TECHNOLOGY AND PARTICIPANT TOOLS
This session focused on how technology will have a continual effect on plan sponsors’ need to remain flexible
and adaptive. Today, plan participants use websites and mobile devices to manage their non-transactional
tasks such as changing addresses and beneficiaries – when it comes to significant financial planning,
participants seek to meet or speak with a trusted financial representative. However, when participants seek
information about their plans’ specifics, they prefer quick summaries. These quick summaries are referred to
as “snackable” education, which are relevant and provide an instant visual end result. (example: if they
increase contributions by “$x” they will have “$y” more at retirement age.) In addition, plan sponsors are
increasingly relying on data analytics to make plan level changes.

CYBER SECURITY
This session reviewed and described three emerging trends that impact DC plans:
• Artificial Intelligence (AI): Technology that appears to emulate human performance such as engaging
in dialogue and replacing people on nonroutine tasks. The challenges and risks of AI are phishing
scams, hackers, and fake news along with the methods of information dissemination.
• Internet of Things (loT): The network of communication from outside physical objects that
communicate, sense and interact with an individual’s devices. It is very difficult, even impossible, to
fully comprehend the interconnectivity between personal devices and outside devices in various
environments. The ability for unrelated devices to connect provides opportunity for viruses and
malicious attacks.
• Conversational platforms: Enable people to communicate to their suppliers, employees, and vendors
with their devices through applications and websites using text, touch or voice. The challenges and
risks are loss of context, manipulation of intended communication, and the creation of real emergencies
difficult to manage.