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Retirement

Boomers View Simple Luxuries as Basic Needs

August 16, 2010 - Americans of All Ages View Social Security as Safety Net

Retirement Self-Starters: Extending Automatic IRAs to America's Unprepared

May 3, 2010 - WASHINGTON -- The Retirement Savings Project, a leading policy research group backed by The Brookings Institution, The Heritage Foundation and Georgetown University, and affiliated with FINRA and the AARP, is advocating new approaches for defined contribution plans, Social Security and tax policies to insure Americans' retirement future.David C. John, deputy director of The Retirement Security Project and a frequent Congressional witness, sat down with Money Management Executive Editor Lee Barney to discuss new laws and regulations that will reshape 401(k) plans and offer new challenges and opportunities for the mutual fund industry-most notably reaching the 78 million Americans who have no workplace retirement savings at all.

GLBs Buoy VA Sales, But for How Long?

March 15, 2010 - While sales of variable annuities declined 18% to $127 billion last year, guaranteed living benefits remained popular, with 84% of policyholders electing to buy those riders in the fourth quarter, according to LIMRA. Jafor Iqbal, an associate managing director at LIMRA Retirement Research, said GLBs' continued popularity is in spite of the fact that insurers spent much of the year raising costs and paring back benefits on the variable annuities, the assets of many are underwater compared to their guarantees.

Retirement Confidence Belies Vast Unpreparedness

March 15, 2010 - American workers are feeling more confident about being able to retire than they were last year, but their expectation to stay in the workforce longer to make up for a savings shortfall and the fact that 54% of the population has less than $25,000 saved has retirement experts extremely worried. "The idea that you can continue on working longer is really a pretty risky proposition," said Daniel Houston, president of retirement, insurance and financial services at The Principal. "Half the time, people retire before age 65, whether it's due to their health, their spouse's health or that they find their skills are no longer needed."

Tear a Page From the AARP/Today Show Playbook

March 8, 2010 - America has yet to witness the tremendous societal transformation retiring Boomers will have, as the oldest is a mere 64 and the youngest, 46. But we are beginning to see signs of the tsunami-sized impact this army of 77 million will have on the workplace, the economy, healthcare and even the arts and entertainment. AARP has just formed a timely, unbelievably beneficial partnership with NBC's "Today Show." Beginning tomorrow, March 9, the No. 1 morning news program that reaches 5.9 million viewers a day, is bringing back former Emmy Award-winning host Jane Pauley to produce and report a monthly segment called, "Your Life Calling."

Fear of Investment Losses Could Take Serious Toll on Retirement

March 8, 2010 - AXA Equitable uncovered a dismal outlook for the economy and retirement in "Retirement in America: A Survey of Concerns and Expectations," in which it polled both investors and economists and found a large percentage of both groups bearish on the economy and the stock and bond markets. Twenty-four percent of consumers and 12% of economists believe the economy will continue to be volatile with no clear pattern of improvement. Eleven percent of consumers and 16% of economists believe the nation could sink back into a recession.

Sidestepping Skepticism, Prudential Scores with VAs

March 1, 2010 - Bruce Ferris, senior vice president of sales and distribution for Prudential Annuities, he has heard all the objections from wholesalers and advisers concerning variable annuities. The investment community complains that the products are too expensive or too complicated, but Ferris is certain that even though VA assets under management declined over the past two years, "they aren't going away." In fact, he said the attitude about variable annuities is beginning to change.

Kalamarides Seeks Risk Disclosure for Target-Date Funds

February 15, 2010 - Fund managers should consider improving target-date fund disclosure to better align these products with the individual risk tolerance of investors, particularly in light of increased regulatory scrutiny over the performance of these funds in 2008, a retirement income expert says.Jamie Kalamarides, senior vice president of retirement solutions at Prudential Retirement, recently spoke with Money Management Executive about improvements to the retirement income product lineup, annuity wrappers for 401(k) plans and multi-employer savings plans for small businesses.

Estate Tax Expiration Reveals Opportunities

February 8, 2010 - NEW YORK - Financial experts think 2010 could provide many interesting opportunities in the realm of wealth transference, particularly with the temporary, one-year expiration of the federal estate tax and reduction of the gift tax.Thanks to the expiration of the estate tax on Jan. 1, beneficiaries of people who die this year don't have to pay federal taxes on inherited estates. Unless Congress takes action this year, the tax will be reinstated in 2011 to 2001 levels of a $1 million exemption and 55% tax rate above that. President Barack Obama has proposed reinstating the tax at 2009 levels of 45% on anything above $3.5 million, possibly retroactively.

Extreme Makeover: 401(k) Edition

February 8, 2010 - Investors are about to test drive 401(k) plans with a 21st Century whole new look and feel.The Department of Labor is promising streamlined rules for 401(k) advice that plan sponsors may actually use (see "Week in Review," page 4). The government is looking into the possibility of offering annuities or other lifetime income options in defined contribution plans.

403(b) Group Seeks Common Language

February 8, 2010 - An industry group developing best practices for 403(b) retirement plans is coming closer to streamlining these plans to make them even more similar to 401(k) plans, but first they will have to get everyone to agree to speak the same language.Leaders say the SPARK Institute's work on 403(b) best practices is coming along smoothly, thanks to the cooperative efforts of approximately 50 participating institutions. The latest update, version 1.04, fixes many of these communication issues by requiring a standardized reporting format, which it hopes most institutions will adopt by this July.

Putnam Calculator Directs 401(k) Investors to Retirement Income

February 1, 2010 - NEW YORK -- Online retirement calculators are usually so confusing or overwhelming that the average plan participant logs in, checks their account balance and then logs off without making any changes. Putnam Investments has developed a new retirement income twist it hopes will resonate with investors, plan sponsors and financial advisers. "Complexity leads to inactivity," said Edmund Murphy, managing director and head of defined contribution at Putnam, at a presentation at the Four Seasons Hotel last week. "Participants find it hard to see how their balance turns into retirement income. They are told they need to save millions, and they just give up and turn off instead."

Merrill Runs $20 Million 'help2retire___' Campaign

February 1, 2010 - Bank of America's Merrill Lynch Wealth Management has launched a new U.S. marketing campaign, "help2retire___," to illustrate individuals' evolving retirement priorities and personal aspirations. Budgeted at $20 million, it launched last Monday and is scheduled to run through the end of April on broadcast network and national cable TV, as well as print and online consumer and trade magazines, including sister publication Financial Planning.

Obama Proposals Could Boost Annuity Sales

February 1, 2010 - To help the middle-class save for retirement, President Obama may have also given a boost to the annuities sector.Last Monday, Obama proposed a series of measures, including expanding existing tax credits for child care and retirement savings, and providing financial relief for families caring for children and the elderly.The White House also plans to promote "the availability of annuities and other forms of guaranteed lifetime income, which transform savings into guaranteed future income, reducing the risks that retirees will outlive their savings or that their retirees' living standards will be eroded by investment losses or inflation."

New Financial Regulations to Create Unprecedented 'Sea Change' at SEC

January 25, 2010 - BOSTON -- Mutual fund companies must stay on top of their compliance programs, particularly because Congress is likely to pass new financial regulations, executives warn. "Regulation writing is about resolving tensions and balancing purposes,' said Michael Novey, associate tax legislative counsel at the Office of Tax Policy at the Department of Treasury. "Our task is to implement legislative purpose, recognizing that Congress' acts ought to be workable. There is a tremendous amount of misunderstanding about many of the proposed regulations."