Seventy-two is an important age milestone for those in or near retirement, as it marks the time when required minimum distributions (RMDs) begin to be withdrawn annually from IRAs and employer-sponsored retirement plans (previously, the threshold was 70 ½). The milestone carries with it tax consequences that are not fixed. Rather, there are a [...]
Only one-in-four Americans (27%) feel very confident that they will have enough money to live comfortably when they retire, according to the 2020 Retirement Confidence Survey Summary Report.1 While the number is up slightly from the 2018 survey (23%), it underscores a pervasive sense of uncertainty among those approaching retirement age. While there is [...]
There’s a simple word that has profound implications for savings and investing: compounding. Like a snowball that grows as it rolls down a hill, compounding provides the potential for your money to grow, reinvesting your investment earnings. It is a basic model for growth potential, and the more you invest, the greater the opportunities [...]
The SECURE Act - Top 10 Key Provisions to Provide Retirement Savings Benefits for Employees and Employers Open Multiple Employer Plans / Pooled Employer Plans – The SECURE Act allows unrelated small employers to band together in “open” 401(k) multiple-employer plans (MEPs; also referred to as pooled employer plans (PEPs)). This reduces the costs and [...]
New Contribution Limits for 401(k) Plans, Traditional and Roth IRA, and Pension Plans The IRS has announced cost of living adjustments affecting dollar limitations for pension plans and other retirement-related items for tax year 2020. For company retirement plans, the most recognized highlight is the 401(k) contribution limit increase to $19,500 for the new year. [...]
With longer life spans come extended healthcare needs — and significantly more dollars required to pay for them It’s more likely today that you’ll live longer than your grandparents did. The flip side is that you may spend far more on doctors’ bills and treatment for chronic illnesses than previous generations. With healthcare costs continuing [...]
Behavioral finance strategies improve the odds Generally speaking, we don’t encourage being shifty. But applying a few innovative moves in your 401(k) plan could result in increased retirement savings for your employees. That’s because, when it comes to money, subconscious perceptions can torpedo a plan participant’s success. Applying behavioral finance principles may help employees overcome [...]
Q: We keep hearing about participant lawsuits against 401(k) plans, and strive to do our best to avoid situations that could lead to one. Part of that is using prudent processes in the plan. We have asked our advisor and done some searching on our own, but haven’t been able to define what processes are [...]
There are lots of advantages to an HSA. But you should keep these three potential pitfalls in mind before you decide to open an account: Contributing when you are no longer eligible – In 2020, you can participate in an HSA if you have a high-deductible health insurance policy with an annual deductible of $1,400 [...]
Q: Our 401(k) plan is relatively small. Do we need to be concerned about fiduciary issues and lawsuits? It seems like there are bigger fish to fry! A: If your plan does not hold much money in assets, you are correct that ERISA enforcement agencies have bigger fish to fry. However, that does not mean [...]
