See full-size image. I was certainty premature yesterday in thinking the bailout bill was going to pass when I wrote the bailout bill is like a Christmas tree – something for everyone including retirement plans. And I wasn’t alone. The stock market reacted with the largest one day drop in its history. No one knows the … Continue Reading
Just recently, I thought that it might be the dog days of summer as far as setting up a retirement plan is concerned. But it may be the “retirement plan season” is here after all – at least in the minds of our fellow bloggers at Slate magazine’s BizBox blog. Their post today is What Retirement … Continue Reading
Two recent 401(k) plan terminations in our little corner of the retirement plan world does not a trend make. But it’s a sign that the economic slowdown is also affecting plan sponsors. Two clients who had not made employer contributions for some time decided that because of the relatively few employees contributing, it simply was … Continue Reading
No, advisers themselves aren’t getting smaller, it’s just that their numbers are. More of them are leaving the financial planning industry as reported by Plan Adviser citing a new report by Cerulli Associates, a research firm specializing in the financial service industry. Cerulli’s Edge Advisor Recruiting Edition says that the number of financial advisers in the U.S. declined from … Continue Reading
View larger image. Lost in the mass media focus on the Baby Boomers retiring is Generation X, the generation that follows. Depending on how they are defined, it’s the people born between 1965 and 1985 (age 23 to 43). I’ve written about them before, Not my generation that nobody seems to want. The "nobody" referred … Continue Reading
Last week Steve Rosenberg on his insightful Boston ERISA Law Blog tells us that Legal Rights That Are Protected In Courts, May Well Be Lost In An Arbitration. Steve comments on a recent Supreme Court case that parties may not contract among themselves for judicial oversight of an arbitration award under the Federal Arbitration Act. … Continue Reading
I’ve got that queasy feeling again in my stomach. The recent collapse of Bear Stearns gave me flashbacks to the 1990s during which we struggled with insolvency issues affecting ERISA plans. If you were around back then, you’ll remember the insurance companies that failed or were seized by insurance regulators as a result of failed … Continue Reading
This is one of those Good News/Bad News stories. The Wall Street Journal on March 27 reported that “Household Wealth Rises as Retirees Age” citing a paper posted on the Federal Reserve’s website. The Journal quotes the authors as saying that adjusted for inflation, The median’s household’s wealth declines more slowly than its remaining life … Continue Reading
Add one more trend to Boomer demographics. Recent research has revealed that Boomers continue to push the limits regarding the prevalence of divorce. While just 33% of married adults from the two preceding generations has experienced a divorce, almost half (46%) of all married Boomers have already been divorced. They will be almost certain to … Continue Reading
One of those wonderful tax benefits that a qualified retirement plan and IRA provide is the tax deferral of contributions and earnings. But nothing lasts forever including the payment of benefits (and the taxes thereon). So the tax laws require RBDs and RMDs. That’s tax talk for “required beginning date” and “required minimum distribution” respectively. … Continue Reading
See full-size image. “Decumulation”, in definitional terms, means the conversion of pension assets accumulated during an employee’s working life into pension income to be spent during retired life. But in practical terms, decumulation embodies a significant new risk for the record number of future retirees moving from the accumulation phase of their lives to the … Continue Reading
I had never heard the term "orphaned 401(k) accounts" until I came across the survey, Competing in the Retirement-Dominated Future, which I referenced last month in my post, Banks Lag Far Behind in Race for Boomers’ Retirement Dollars. The survey used the term in referring to those 401(k) accounts still held in plans of previous … Continue Reading
I’ve written about IRAs in the past. (See IRA is not a kid anymore and IRAs are becoming increasingly important, but rules can be confusing). But those discussions were in the context of tax planning for distributions. IRAs are, of course, also a tax-advantaged investment vehicle. And as retirement dollars start to increasingly become available, … Continue Reading
That’s the message provided by a recent study released by the Center for Retirement Research (CRR) at Boston College. According to the study, 44% of Baby Booomers (people born between 1946 and 1964) and Generation Xers (people born between 1965 and 1974) are "at risk" of being unable to maintain their standard of living in … Continue Reading
The retirement market is in the trillions, but banks will have to play catch-up to acquire a significant share of those dollars. According to a recent survey, only 14% of “mass affluent consumers” cited their banks as primary providers of retirement services, compared to 53% for investment and brokerage firms. And in the past year, … Continue Reading
See full-size image. If you’re confused about the various types of designations in the financial service marketplace, you’re not alone. Even the financial service industry and the regulators are having a hard time making sense of the alphabet soup of designations. The American College, a non-profit institution that provides financial services education, has been tracking … Continue Reading
While most investors these days are focusing on risk in terms of the market and its effect on their account balances, Tim Burns in his blog, Fiduciary Investor, says that they should pay attention to a larger risk. It’s longevity risk, or the risk of a retiree outliving his or her assets. Mr. Burns, in … Continue Reading
Wealth manager, Russ Bailyn, in his Financial Planning Blog asks employers to consider the benefits of a Roth 401(k). Russ looks at it from the standpoint of the employee. Ours is with the employer, and unfortunately, it’s been slow going with plan sponsors adding a Roth provision to their 401(k) plans available since 2006. The … Continue Reading
Last year, I wrote that IRAs are becoming increasingly important, but rules can be confusing. And even more so when considering the rollover possibilities in moving benefits from one plan to another. Portability of benefits between IRAs, SEPs, SIMPLE IRAs, Roth IRAs, 401(k) plans, profit sharing plans, defined benefit plans, 457 plans, and 403(b) plans … Continue Reading
The Iowa caucus voting results are in, and so is the American Dialect Society’s 18th annual words of the year vote (PDF), and "subprime" won by a large margin. The vote, of course, reflects the preoccupation of the press and public for the past year with a deepening mortgage crisis. The American Dialect Society (ADS) … Continue Reading
According to a recent survey (PDF) by Country Insurance & Financial Services, more people resolved to lose weight and exercise more (24%) or to spend more time with friends and family (23%) than plan to focus on improving money matters in 2008 (17%). Respondents also said that they’ll make better financial choices next year, although … Continue Reading
"Taxman" The producer of this video, WildCard Productions, calls it "a tribute to the greatest band’s greatest album". It is, of course, the Revolver album released in 1966, often cited as one of the greatest albums in rock music history, The song on the video, “Taxman”, was written and performed by George Harrison. Harrison performs the … Continue Reading
See full size image. It’s that time of the year again. Yes, that time when tax advisers like Joe Kristen who writes the Tax Update Blog for Roth & Co., P.C., ask self-employed business people, Is A Qualified Plan a Good Move by Year End?. So let’s assume that for personal financial and tax reasons … Continue Reading
A new and unpopular Michigan 6% service tax on business died on Saturday less than 17 hours after it had taken effect. The tax officially became law at 12:01 a..m. Saturday, but later in the day the Michigan legislature approved a bill repealing and replacing the tax which Governor Jennifer Granholm later signed that same … Continue Reading
