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Blogs
Some Reasons to be Thankful
As we reflect on the holiday season and the New Year, it is important to be thankful – thankful for our families and friends and thankful for our profit sharing/401(k) plans. Without employer-sponsored defined contribution plans, the market correction of 2008-2009 would have been more severe. Because of DC plans, trillions of dollars stayed in the... Read More >>
Rebalancing: A 401(k) Advantage
The benefits of investing in a 401(k) are many, but one rarely mentioned is that 401(k) participants can rebalance their plan asset allocation without concern about the tax consequences. An optimal way to manage a long-term investment account is to initially identify and implement an asset allocation strategy and then to periodically bring the... Read More >>
Taking Roth 401(k) To The Next Level
Individuals saving for retirement in an employer-sponsored retirement plan should have the same tax diversification opportunities as individuals saving in an IRA. PSCA is taking action. We are working for changes that would permit Roth conversions within an employer plan. Starting in 2010 even those making $100,000 or more will be able to convert... Read More >>
First Healthcare Then Retirement
The US made a decision in the 1930s to limit government delivered "benefits" to Social Security-provided retirement income. Paying for other benefits was a personal responsibility, though in some cases employers were encouraged to help. Since then government-provided benefits in the US have expanded but mostly as part of the safety net. European... Read More >>
DC and DB Plans - Nothing is Risk Free
DC plans, like the 401(k) and DB pension plans, are like apples and oranges, both good for you but very different. With a DC plan, the employer and/or the employee contribute to the plan over time, and the benefit is the sum of those contributions and the earnings thereon—a lump sum. A DB plan provides a formula-based income stream at retirement... Read More >>
Time Magazine 401(k) Article: Advocacy Dressed Up In Journalism
Our opponents must be extremely disappointed with the performance of the 401(k) system over the last year. In the late 1980s many argued that a future economic correction would result in a collapse of the system. Some went so far as to suggest that participant anger would lead to unionization of workforces covered by 401(k) plans. Instead, we have... Read More >>
Social Security: A Permanent Part of America's Retirement Fabric
I was recently interviewed by a reporter for a UK publication about the US defined contribution system. During the interview she suggested that some she had interviewed questioned the future viability of Social Security. I pointed out that as long as there are American workers paying Social Security taxes there will be Social Security benefits... Read More >>
In Retirement It's Health Not Just Wealth
The number one concern of older Americans is their health. Financial concerns are not even close. If we have less we can spend less and still enjoy a hike in one of our beautiful national parks. If our health is failing how much money we have does not matter and it is fortunate we have television to watch all day. Overall health in retirement is... Read More >>
401(k) Fee Disclosure: What You Have Seen Is Not What You Will Get
In today's time and resource challenged environment we need to focus on what we know must be done. As time passes, it becomes less likely that 401(k) fee legislation will be signed into law this year. Further, the House Education and Labor and the House Ways and Means Committees are supporting different approaches to fee disclosure, and it is... Read More >>
Stable Value Delivers In Difficult Times
Stable value funds are uniquely available in employer-sponsored retirement programs and are one of the reasons why saving in a 401(k) is so attractive. According to PSCA’s 51st Annual Survey of Profit Sharing and 401(k) Plans, 56.4 percent of plans have a stable value fund in their fund lineup. Importantly, 75.7 percent of companies with 5,000 or... Read More >>