FIDELITY LOWERS MINIMUM GIFT FUND CONTRIBUTION: In an effort to make the benefits of donor-advised funds more accessible, the Fidelity Charitable Gift Fund announced that it would lower its initial contribution and grant recommendation minimums.
The minimum initial contribution to the Gift Fund enabling an individual to establish a Giving Account was reduced by 50 percent, to $5,000. The grant recommendation minimum dropped from $250 to $100. Both changes became effective in October.
The introduction of a $5,000 initial contribution minimum and reduced grant minimum are the latest in a series of enhancements to Fidelity's Gift Fund. Over the past year, the Gift Fund has pared down the administrative fee on most Giving Accounts by at least 40 percent, added non-Fidelity mutual funds to investment pools, provided new pool choices and instituted the Endowed Giving Program.
In addition, the Gift Fund recently created the Charitable Investment Advisor Program. The program, available to Gift Fund donors with a minimum Giving Account balance of $1 million, allows qualified independent advisors to provide discretionary investment management to the Gift Fund for contributions made by the advisors' clients.
Meanwhile, Fidelity reported that overall grants to charity from the Charitable Gift Fund surpassed $964 million for the 12 months ended Aug. 31, 2006, up 26 percent over the same period a year ago. Contributions to the Gift Fund for the same period were $1.1 billion, up 22 percent year over year.
MORNINGSTAR INC. TO PROVIDE NEW ETF MUTUAL FUND DATA: Investment research concern Morningstar said that it is providing new data for open-end mutual funds and exchange-traded funds to help determine how average investors fared in a fund over a period of time. The new measure, called Morningstar Investor Return, estimates the return earned collectively by all the investors in a fund.
Investor return, also known as dollar-weighted return, accounts for all cash inflows and outflows from purchases, sales and growth in fund assets. It complements the traditional metric of total return, which measures what investors could have earned had they bought and held the fund, re-investing all dividends, over a period of time.
Investor return is an internal-rate-of-return calculation that places greater emphasis on periods in which fund assets are larger. Morningstar currently calculates one-, three-, five- and 10-year trailing and annual investor returns for open-end mutual funds and exchange-traded funds.
PAYCHEX ADDS ROTH 401(K) OPTION: Payroll and benefits outsourcing provider Paychex Inc. has added a Roth 401(k) feature to its current suite of retirement services.
The Paychex Roth 401(k) offers small and midsized businesses another retirement avenue as 401(k) contributions are funded with after-tax dollars, but withdrawals can generally be tax-free when made at retirement.
Under the guidelines of a traditional pre-tax 401(k), participants contribute with pre-tax wages, and then pay taxes when the money is withdrawn.
Workers may contribute a maximum of $15,000 during 2006 to qualified retirement plans; those over 50 may make an additional $5,000 catch-up contribution. The amounts contributed can be divided in any manner between the pre-tax and Roth contributions.
HICKERSON NAMED VP AT AMERICAN COLLEGE: The American College, a nonprofit educator of financial and insurance executives, financial planning and insurance professionals, named Keith E. Hickerson to the post of vice president of marketing and communications.
In his new role, Hickerson will be charged with coordinating the activities of the institution's marketing division and raising the brand awareness of the college.
Prior to coming aboard at The American College, Hickerson served as vice president of corporate marketing for UnumProvident Corp., an income protection and supplemental insurance benefits concern.
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