Retirement

Financial security in retirement is one of our nation's cornerstone principles when it comes to the way of life we have come to envision after a lifetime of hard work, dedication and sacrifice. Originally, the underpinning of that retirement security for those in the private sector was to come from Social Security enhanced by private pensions and personal savings. Unfortunately, for many of us, the demise of most employer-funded primary pension plans and inadequate personal savings has shifted the role of Social Security from being a safety net of supplemental income to being the primary, and sometimes only, source of retirement cash flow.

Based on 30+ years of plan sponsor experience, I believe negative press about 401(k) loans are aimed at the wrong target. Rather, hardship withdrawals should be in the crosshairs, not loans.

Offering a retirement plan can be one of the most challenging - yet rewarding - decisions an employer can make. The employees participating in the plan, their beneficiaries, and the employer all may benefit when a retirement plan is in place. Administering a plan and managing its assets, however, requires certain actions and involves specific responsibilities governed by the Employee Retirement Income Security Act.

Though the 401(k) and defined contribution market gets lots of attention from all sectors of society and has a significant amount of assets, there are only about 110 national providers and advisory firms focused on this market.

Employees do not save enough for their eventual retirement needs, research shows. But, with tools, help and education from financial advisers that paradigm may shift - benefiting not only the employee but the employer and adviser.

The U.S. retirement market is projected to grow to nearly $22 trillion by 2016. That represents a 38% increase from an estimated $16 trillion mark for the end of 2011, due mostly to continuing market recovery, according to data released Monday by Cerulli Associates, a Boston-based research firm.

Employees around the country are in need of direct, simple guidance to help them reach their retirement goals, according to a survey released by State Street Global Advisors.

The ongoing shift from defined benefit (DB) to defined contribution (DC) plans has prompted the financial services industry to rapidly develop products that deliver a steady stream of retirement income, one of the biggest shortcomings with DC plans. While numerous retirement income products are hitting the marketplace, employers and regulators are grappling with how they fit within qualified retirement plans.

Baby boomers appear to be taking a second look at their life insurance policies as an alternative financial solution to paying for retirement, where they sell an unneeded life insurance policy for a portion of the face amount. These transactions, known as life settlements, have become a mainstream practice in the past several years, particularly as baby boomers begin exploring all financial options to paying for retirement, including previously unconventional alternatives.

Men and women are preparing for retirement in very different ways, according to findings from Ameriprise Financial. While men outpace women in planning for the financial aspects of retirement (77% vs. 72%), women are more likely to say they've thought about what they'd like to do during retirement. And though a mere 22% of Americans report confidence in reaching their retirement goals, men are significantly more likely than women to report this sentiment (25% vs. 19%).