Save early and save more, retirees advise

Most retirees (70%) in a recent survey said they would advise younger workers to start saving early and save more. According to the report, 49% said they wished they had planned earlier for retirement. Among those retirees who did not start working with an advisor until closer to retirement, 57% said they could have benefited from meeting with an advisor earlier in their career. Only 42% of respondents had a written financial plan. Among respondents who said they’re paying different taxes than expected, 60% are paying more.

Proposed bill would allow rollovers from 529 plans

A new bill would allow rollovers of unused funds from 529 college savings plans without penalty. The College Savings Recovery Act, introduced by Senators Richard Bur and Bob Casey, would allow the rollover of 529 funds into Roth IRAs without a penalty. Under current law, families are penalized for withdrawing unused funds from 529 plans if their child does not go to college or completes their degree without using all the money. The penalty is 10% on the earnings portion of the funds.

Millennials cautious about finances

Having gone through several financial crises, Millennials are more cautious about their finances, according to a recent survey. In fact, 56% of Millennials reported they felt confident about protecting their finances in the event of another economic downturn. Other generations were not as confident, with 43% of Generation X and 33% of baby boomers noting they were confident. Most Millennials said they also felt confident about their retirement savings, and 83% noted they had a strategy in place to guard against market risk.

Investors less optimistic about markets

Investor sentiment grew more bearish in the recent AAII Investor Sentiment Survey ended June 15, 2022. The number of investors with a bearish sentiment — the belief the price of stocks will fall in the next six months — rose to 58.3% from 46.9% in the previous week. Investors reporting a bullish sentiment – the belief that stock prices will rise in the next six months – slipped to 19.4% from 21.0% in the previous survey. Those reporting a neutral position fell to 22.2% from 32.1%.

Senate committee advances retirement bill

The Senate Health, Education, Labor & Pensions Committee last week unanimously approved the Retirement Improvement and Savings Enhancement to Supplement Health Investments for the Nest Egg (“Rise & Shine Act”). The bill would expand workplace savings plans, enhance auto enrollment, and provide for other improvements to retirement plans. The move would include the bill in the Senate’s version of SECURE 2.0, that was passed by the House. The Senate Finance Committee is expected to introduce a final version, which will need to be reconciled with the House bill before being voted on by both chambers.

Rising interest in ESG investing

Investments that focus on ESG (environmental, social, and governance) factors have grown in popularity in recent years. In 2021, ESG —or sustainable — funds in the U.S. took in $70 billion in net flows, up 35% from 2020. While interest in ESG has risen, more education is needed, according to a recent study. Among those surveyed, 26% hold an ESG investment, and 46% said they were interested in ESG. In addition, 35% said they were not interested. Of those, more than half said they were not interested because they don’t understand enough about these investments.

Consumers remain optimistic about finances, survey finds

Despite concerns about inflation and the possibility of a recession, more than half of adults in a recent survey remain optimistic about their finances. Inflation remained the biggest concern among 63% of respondents, followed by recession (30%) and the cost of rent (25%). Still, 55% of those surveyed were optimistic overall about their financial future.

Many students lose interest in four-year college programs

Many high schoolers are not interested in pursuing a four-year college degree. Instead, 73% of respondents believe post-secondary education should be a shorter, more affordable, direct path to a career, according to a recent survey. The percentage of respondents indicating they are likely to attend a four-year college fell to 51% in 2022 from 71% in 2020. Many surveyed (42%) said their ideal post-secondary education would include three years of college or less, and 31% said it should be two years or less. The survey, that began in February 2020, included more than 5,300 high school students.

Despite volatility, retirement savers stay the course

Most retirement savers stayed the course with their investments in the first quarter, despite market volatility, according to a recent study. The report compiled data from retirement plan participant activity in self-directed brokerage accounts. Overall, the average account balance across these accounts fell 6.25% in the first quarter compared with the previous quarter. However, savers did not make significant changes to their allocations. Outside of a slight increase in cash, overall holdings remained similar to the previous quarter. Savers held the majority of assets in equities (36%). Mutual funds were the second-largest holding at 29%, followed by ETFs (21%), cash (13%), and fixed income (1%), the report stated.

Putnam Investments to Launch Fixed Income and Quantitative Equity ESG Investment Strategies

BOSTON, June 8, 2022 – Putnam Investments today announced that the firm will bring three active fixed income and two active quantitative equity exchange-traded funds (ETFs) to the market, all with an environmental, social and governance (ESG) focus, following completion of the regulatory process.

The new ETFs to be launched by Putnam in the coming months are:

Fixed Income ETFs —

  • Putnam ESG Core Bond ETF
  • Putnam ESG High Yield ETF
  • Putnam ESG Ultra Short ETF

Quantitative Equity ETFs —

  • Putnam PanAgora ESG International Equity ETF
  • Putnam PanAgora ESG Emerging Markets Equity ETF

The new, ESG-focused Putnam fixed income portfolios build upon the long-time capabilities and experience of the Putnam Fixed Income team, utilizing an ETF format. The two quantitative equity ESG strategies will be sub-advised by Putnam affiliate PanAgora Asset Management, Inc., which is well regarded in the industry for its quantitative investment management expertise. Putnam will be the sponsor/investment adviser on all five transparent ETFs.

Additionally, the new fixed income and quantitative equity ESG ETFs, along with the existing Putnam Sustainable Leaders ETF and Putnam Sustainable Future ETF, will serve as underlying investment components within the firm’s ESG-focused target-date series, the Putnam Sustainable Retirement Funds. This new suite will be implemented in the coming months through a repositioning of the existing Putnam RetirementReady® Funds target-date series.

“Putnam is committed to providing investors with a range of thoughtful, alpha-seeking sustainable and ESG offerings, as we believe in the value and importance of these strategies in building a long-term investment portfolio,” said Robert L. Reynolds, President and Chief Executive Officer, Putnam Investments. “We have seen growing interest from many corners of the marketplace for ESG investing across a range of asset classes – and are excited to introduce these new fixed income and quantitative equity ETFs to our lineup.”

The five new ESG-focused ETFs, which will be available in the coming months, are:

Putnam ESG Core Bond ETF: Will seek high current income consistent with what Putnam believes is prudent risk by investing mainly in a diversified portfolio of investment-grade fixed income securities, with a focus on companies or issuers that Putnam believes meet relevant ESG criteria. The fund will invest mainly in bonds of governments and private companies that are investment-grade in quality with intermediate- to long-term maturities (three years or longer). Portfolio Managers: Michael Salm, Andrew Benson and Sri Mahanti.

Putnam ESG High Yield ETF: Will seek high current income, with capital growth as a secondary goal when consistent with achieving high current income. The fund will invest mainly in bonds that are below investment-grade in quality (sometimes referred to as “junk bonds”) that have one or more of the following characteristics: (1) are obligations of U.S. companies or issuers and (2) have intermediate- to long-term maturities (three years or longer). The fund will invest with a focus on companies or issuers that Putnam believes meet relevant ESG criteria. Portfolio Managers: Rob Salvin and Norm Boucher.

Putnam ESG Ultra Short ETF: Will seek as high a rate of current income that Putnam believes is consistent with preservation of capital and maintenance of liquidity. The fund will invest in a diversified portfolio of fixed income securities composed of short duration, investment-grade money market and other fixed income securities, with a focus on companies or issuers that Putnam believes meet relevant ESG criteria. Portfolio Managers: Joanne Driscoll, Andrew Benson and Michael Lima.

Putnam PanAgora ESG International Equity ETF: Will seek long-term capital appreciation by investing mainly in common stocks (growth or value stocks or both) of companies of any size outside the United States with a focus on securities that PanAgora believes offer attractive benchmark-relative returns and exhibit positive ESG metrics. Portfolio Managers: George Mussalli and Richard Tan.

Putnam PanAgora ESG Emerging Markets Equity ETF: Will seek long-term capital appreciation by investing mainly in common stocks (growth or value stocks or both) of emerging markets companies of any size with a focus on securities that PanAgora believes offer attractive benchmark-relative returns and exhibit positive ESG metrics. Portfolio Managers: George Mussalli and Richard Tan.

“These new products represent the ongoing evolution of Putnam’s ESG investment capabilities across asset classes, ultimately to help advisors and their clients construct robust portfolios,” explained Carlo Forcione, Head of Product and Strategy at Putnam. “We are enthused to have these offerings join an expanding stable of Putnam actively managed ETFs in the market.”

Forcione noted that Putnam launched its first four active equity ETFs in May 2021, and recently made filings to create three additional active equity ETFs to focus on business development companies, biology revolution firms, and emerging markets ex-China.

About PanAgora Asset Management, Inc.

Founded in 1989, PanAgora Asset Management, Inc. is a forward-looking investment firm underpinned by insightful research, innovation and creativity. The hands-on oversight, combined with the firm’s singular focus on seeking to develop and implement distinctive Active Equity and Multi Asset strategies, enables the firm to offer diversified and tailored investment solutions designed to help clients achieve their financial objectives.

About Putnam Investments

Founded in 1937, Putnam Investments is a global money management firm with over 80 years of investment experience. At the end of April 2022, Putnam had $180 billion in assets under management. Putnam has offices in Boston, London, Munich, Tokyo, Singapore and Sydney. For more information, visit putnam.com.

NOTE: The registration statement relating to these securities has been filed with the SEC but is not yet effective. These securities may not be sold nor may offers to buy be accepted prior to the time the registration statement becomes effective. This press release is not an offer to sell these securities and is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted.


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