Would the #SecureAct Make A Difference To Your Retirement Savings?

July 10, 2019 | posted in: Blog, Employee Education | by

Would this legislation, proposing to raise the age of required minimum distributions, make a significant difference to your retirement portfolio? Sarah O’Brien looks into that question; see what she found.

Are You Delaying Your Own Retirement to Help Out Your Kids?

April 11, 2019 | posted in: Blog, Employee Education | by

You may want to help your kids pay for things like cars and weddings, but it’s really not a great idea to delay your own retirement in order to do so.  Read more.

Yikes! 30% of Workers Can’t Answer This…Can You?

May 15, 2018 | posted in: Blog | by

One third of workers don’t know the answer to this simple question about their retirement savings:  Now that you’ve saved for retirement, what are you going to do with the money?  Click here for more details, and tips on what you should be thinking about for your retirement savings.

Plan Sponsors Ask…

December 30, 2016 | posted in: Plan Sponsor Corner | by

Q: Women are better retirement savers but still lag behind men in outcomes. What gives?

A: Indeed, there is a noteworthy imbalance in retirement wealth accumulation among men and women. Men consistently come out ahead, despite women’s superior savings behaviors.

Women are more likely to save, but men have higher account balances, according to a Vanguard white paper. Its data shows that women are 14% more likely than men to participate in their employer-sponsored retirement plan. Further, once enrolled, women save at higher rates—typically 7%-16% higher than men. Don’t “autopilot” provisions like auto-enrollment equalize things? On the participation front, yes; for savings, no. Among auto-enroll plan participants, men and women participate at similar rates, but men defer at 5% higher rates. Moreover, women are conscientious savers, and auto-enrollment provides them an advantage. Sixty percent fall into lower wage brackets than men, but lower-income individuals experience more positive impacts on savings due to auto-enrollment. What’s more, higher incomes cancel out default features. Among male Vanguard participants, average wages were 25% higher, accounting for higher contribution rates by men in auto-enroll plans. In voluntary-enroll plans, women save at 6% higher rates. Vanguard’s paper highlights a lingering income disparity between men and women and shows that American employers have more work to do to close the gender gap in retirement outcomes.
Read more at http://tinyurl.com/WomenAreBetterSavers.
Q: Many younger participants are simultaneously saving for retirement and paying off student loans. How do we help them successfully accomplish both?

A: Putting off retirement savings to pay down student loans is among the biggest financial mistakes younger workers can make.

In fact, LIMRA found that a 22-yearold with $30,000 in student loan debt could have $325,000 less in savings at retirement than his or her debt-free counterpart. So what’s a plan sponsor to do? Emphasize holistic financial well-being by:
• Encouraging DC plan participants to make the minimum monthly payments on their student loans, and also reminding them to save enough in their retirement plan to get matching contributions. According to Financial Engines, 1 in 4 employees don’t take advantage of the match, meaning they’re leaving up to $43,000 on the table over 20 years.
• Emphasizing creating an emergency fund for unforeseen expenses so they won’t be tempted to borrow from their retirement account or use credit cards.
• Advising them to direct any remaining funds strategically, either by paying down high interest student loans or investing more into their retirement portfolios and putting the money to work through compounding.
• Encouraging participants to stash that extra cash in their retirement accounts once their debt is paid off. Many experts say workers should be saving 15% of their income by age 25 to ensure a comfortable retirement.
Visit http://tinyurl.com/LIMRAStudentLoanResearch and
http://tinyurl.com/StudentDebtVsRetirement to find out more about helping workers save for retirement while paying off student loans.
For plan sponsor use only, not for use with participants or the general public. This information is not intended as authoritative guidance or tax or legal advice. You should consult with your attorney or tax advisor for guidance on your specific situation.
Kmotion, Inc., 412 Beavercreek Road, Suite 611, Oregon City, OR 97045; www.kmotion.com © 2016 Kmotion, Inc. This newsletter is a publication of Kmotion, Inc., whose role is solely that of publisher. The articles and opinions in this publication are for general information only and are not intended to provide tax or legal advice or recommendations for any particular situation or type of retirement plan. Nothing in this publication should be construed as legal or tax guidance; nor as the sole authority on any regulation, law or ruling as it applies to a specific plan or situation. Plan sponsors should consult the plan’s legal counsel or tax advisor for advice regarding plan-specific issues.

Good News on Tax Saver’s Credits

May 25, 2016 | posted in: Employee Education | by

Laws that were enacted as part of the Bipartisan Budget Act of 2015 include new rules that could mean larger tax credits for some workers.

Bigger Retirement Savings Contributions Credit

The Saver’s Credit is an important tax credit that many American workers who save for retirement may be missing out on. Low and moderate-income savers who meet IRS requirements may be able to take a bigger tax credit (“Saver’s Credit”) of up to $2,000/$4,000 (singles/couples) for making eligible contributions to an employer sponsored retirement plan or IRA. To see if you qualify, visit www.irs.gov and enter “Do I qualify for the Retirement Savings Contributions Credit?” in the search box.

Are you part of “Generation Grumpy”?

December 19, 2013 | posted in: Blog | by

If you were born from 1962-71, you may be part of #GenerationGrumpy. You’re not alone, and you’re entirely justified!
According to The New York Times’ Robert Gebeloff, “The generation of people born 1962 to 1971, now in what are typically peak earning years, are finding they are not doing as well as they might have expected….Middle age used to be the peak earning years on the job market, but this is no longer true, especially for men. People 45 to 54 are still earning more than than younger colleagues. What’s changed is on the other side of the age matrix: Older workers have increasingly gained ground on the income scale. The older they are, in fact, the more rapid the ascent up the income rankings.”  Read the full article here.
Regardless of what you thought you might be earning, however, there’s always opportunity to save for retirement.  Please give us a call if you’d like to learn more.