Retirement

The U.S. Labor Department has removed a controversial part of its proposed 401(k) fee disclosure rule that would have required retirement plan providers to create a summary document, or "roadmap," of all their fees for employers.

With tuition costs on the rise, employees looking for ways to pay for their children's college education can save with 529 plans, a tax-advantaged savings plan that encourages parents or guardians to save for a child's college education. Phil Chandler, a financial adviser for Edward Jones, says the tax-free gains feature is the primary driving force behind the popularity of 529s. Previous products did not allow this aspect to be used for higher education.

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.