Retirement

Rather than offer the complete lineup of a target-date series in their 401(k) plan, sponsors are selecting only those funds that fit the age and demographics of their employees. This could result in under-funded target-date funds that could put the entire lineup in jeopardy, according to a new report, “Trends in Date-Date Portfolios on Recordkeeper Platforms,” from Financial Research Corp.

Rather than focus on the traditional notion of saving for retirement, asset management firms serving affluent investors with a minimum of $100,000 to invest and who are between the ages of 40 and 60 should understand that most of these people never intend to leave the workforce, according to Hearts & Wallets.

Even before the events surrounding the U.S. debt ceiling deal and downgrade, affluent investors’ concerns about how long their retirement assets will last was rising, according to a new Bank of America Merrill Lynch survey conducted in June.

Default retirement options can be a good thing; they give employees a chance to gain benefits without having to stress over choices. But, they can also be a bad thing; not all default options fit individual employees’ long-term goals or plans.

Women are less likely than men to concentrate on financial planning, according to a new survey on financial wellbeing and health.

Despite arguments that retirees should be exposed to equities in order to bring enough growth in their portfolios to last throughout their retirement, Morningstar’s president of the investment management division, Peng Chen, argues in a new article that retirement portfolios must include a conservative bent that includes longevity-insurance products.

A Fidelity Investments survey released on July 28 found that a majority of Americans do not understand how their pensions work.

Simply stated, offering employees retirement education is the right thing to do. Retirement plans are complex and not easily understood by the average employee. More employees would participate in corporate retirement plans if they understood them better. If you are offering a 401(k) plan to your employees, but not sharing the value of the plan or how to use it properly, you aren't really committing to a solid retirement program.

The majority of employers want to prepare employees for a financially secure retirement, but have found educational campaigns unlikely to result in substantial changes in behavior. Employers walk a fine line when they implement automatic features; some argue that they enable lax saving habits and investment ignorance by funneling participants into plans automatically.

The decline in property values across most of the country, a prolonged recession, and plain old negligence and shortsightedness on the part of American workers have all combined to make retirement more a fantasy than a reality for tens of millions of baby boomers.