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Archive for the ‘Retirement’ Category

'Retirement Hell' Forecast By Windsor-Based LIMRA

Posted: March 17, 2012 at 8:34 pm


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The numbers demonstrate how ill-prepared most Americans are for retirement and the daunting circumstances that will make the twilight years difficult for late-generation baby boomers and Generation X.

People in their 30s to 50s are less likely to have pensions than previous generations. Their retirement savings are mired in a low-interest environment. They are expected to live longer than people in previous generations. And health care in their retirement years is projected to be far more expensive than it has been.

The Windsor-based trade group LIMRA, which used to be called the Life Insurance Marketing and Research Association, has tracked how much people are setting aside for their retirement, what people are expecting from retirement and how those paths are diverging.

"Too many Americans are headed for retirement hell," LIMRA CEO and President Robert A. Kerzner said in an interview with The Courant. "They are not going to have the retirement of their dreams."

Two main issues are undermining retirement security people are likely to live longer and they won't have enough money, according to LIMRA, the largest research firm for the life insurance and financial services industry.

Boston College's Center for Retirement Research, in its 2009 National Risk Index, said, "This gloomy forecast is due to the changing retirement income landscape. Baby Boomers and Generation Xers will be retiring in a substantially different environment than their parents did. The length of retirement is increasing as the average retirement age hovers at 63 and life expectancy continues to rise."

A LIMRA analysis of how much U.S. households saved in investable assets including 401(k) accounts and IRAs, but not including home values or pensions shows that 35 percent have less than $10,000. Another 24 percent of households have from $10,000 to $49,999. And 11 percent have from $50,000 to $99,999.

That means 70 percent of Americans have less than $100,000 saved for retirement, not including their pension, Social Security payments and the value of their home. The percentage of working Americans who said they have less than $25,000 in savings and investments has increased from 48 percent to 56 percent between 2007 and 2011.

In a report last year, the American Academy of Actuaries suggested that individuals plan to save $20,000 per year for 25 years, or $500,000. The academy also suggests putting money into an annuity for timed distributions rather than a lump-sum distribution.

How much a person needs for retirement depends on the person, the quality of life they want in retirement, how long they will live, where they will live, monthly expenses and many other factors that are personal and difficult to foresee. However, companies that offer retirement-savings funds recommend a retiree have monthly income that is 75 percent of their working income. Retirement income might include Social Security, a pension and savings.

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'Retirement Hell' Forecast By Windsor-Based LIMRA

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March 17th, 2012 at 8:34 pm

Posted in Retirement

Grasmick Kicks Retirement To Curb – Video

Posted: March 16, 2012 at 9:19 pm


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13-03-2012 17:22 Former State School Superintendent Nancy Grasmick kicks retirement to the curb and assumes a leadership position with Towson University.

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Grasmick Kicks Retirement To Curb - Video

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March 16th, 2012 at 9:19 pm

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Should Your DNA Affect Your Retirement Planning?

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Despite all of the numbers and ratios surrounding it, retirement planning is not an exact science. You want to put enough away in your savings accounts to live comfortably throughout your golden years, yet knowing precisely how long those will last -- and accordingly, how much money you'll need -- is impossible.

But while you can't know exactly when you'll die, some of the latest developments in DNA research make it possible to tease out genetic traits that may offer clues about the length of your life. Could tests like these someday impact your retirement planning -- particularly if you learn your lifespan may stretch beyond the average?

Telomeres and aging

Research has indicated that your telomeres may offer some useful clues about your potential lifespan. Telomeres are pieces of DNA found at the end of chromosomes. As people age, their telomeres shorten. Shortened telomeres can also signal an increased risk for heart disease. According to a University of Copenhagen study, shortened telomeres are linked to an increased risk of heart attack and early death by 50 and 25%, respectively.

Life Length is a manufacturer planning to roll out a blood test to measure telomeres. The test, expected to be available in Europe and Asia this year, will cost $700. A member of the company's scientific advisory board told ABC News last year that the test would be able to predict within a decade an individual's biological age -- a potential clue in determining the person's lifespan.

But if a $700 test doesn't sound prudent to you, it's not the only thing you could use in estimating how long you''ll live. Since longevity -- or the lack of it -- runs in some families, looking to your parents and grandparents can offer some insight on what kind of lifespan you might expect.

Longer lives for everyone

Once you have some clues on how long you may live, what can that information mean for your retirement? Certainly, you don't want to quit saving for retirement -- even if you don't think you'll make it much past age 65. Medicine has come a long way in recent years. Consider the fact that the average life span was only 47.3 years for those born in 1900, and is now 77.9 for children born in 2007. Make no mistake: Your father's death at 59 is no reason to short-change your retirement.

So how much do you need? Perhaps more than you think. Recent data from the Bureau of Labor Statistics says that the average 50-year-old will spend $1.4 million on their way to age 81. Those who hit age 100 can expect spending during the second half of their lives to top $2 million.

In addition, centenarians aren't a rarity anymore. The Census Bureau estimates there will be more than 600,000 individuals aged 100 or older by 2050. At the same time, the Census Bureau estimates the average retirement age will actually drop. In 2050, it estimates the average age at retirement will be 63. So while the average retirement period is expected to be nearly 22 years, centenarians will need enough in reserve to cover at least 37 years.

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Should Your DNA Affect Your Retirement Planning?

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March 16th, 2012 at 9:19 pm

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Fleeing to cash won't protect retirement savings

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NEW YORK (CNNMoney) -- I'm a 65-year-old retiree who has a comfortable pension and retirement savings that, for now at least, I don't need for living expenses. About a year ago I moved my savings into cash because I was worried about the unstable stock market and the crisis in Europe. I hate to see this money earn nothing, but I don't want to lose it if the stock market dives. Should I leave my savings in cash? Invest it in short-term bonds? Should any of it go into stocks? -- Don S.

Given all the turmoil in the economy and the financial markets the past couple of years, it's not surprising that you want to be careful about keeping your retirement stash secure.

But fleeing to cash to protect your savings is an ill-advised move that can backfire. In fact, in your case it already has.

Since you pulled out of the market a year ago, stocks have gained almost 10%, while bonds have returned roughly 7%. Which means that even the most conservative mix of stocks and bonds would have given you a much better return than, say, a money-market fund, which likely earned less than 0.1% over the past year. So in the short-term at least, your gambit didn't pay off.

As for the long-term, moving to cash and staying put would make your savings safer in the sense that your money will be insulated from the market's gyrations. But there's a big drawback as well.

The returns on secure vehicles like savings accounts, money funds and the like barely keep pace with inflation over long stretches. After paying income taxes on gains, the real value of your savings could actually shrink as you age.

So if a dash into cash isn't the right way to go, what's a 65-year-old who doesn't want to see his nest egg scrambled to do?

Your first move should be to adjust your focus to the longer term. Right now, you're thinking only of how to protect your savings from what may happen in the market over the next few weeks or months.

Based on life expectancy for someone your age, you have a 50-50 chance of living another 20 years or so. And since life expectancy represents only the average life span, you have a good shot at living much longer. So even though you're retired, you should invest as if you'll be doing so for a long time. I generally tell retirees they should plan as if they'll live into their early 90s, longer if they come from a family with a history of longevity.

That means you want to invest your savings in a blend of stocks, bonds and cash that will not only give you some protection from short-term market drops, but enough long-term growth potential to maintain the purchasing power of your nest egg as well.

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Fleeing to cash won't protect retirement savings

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March 16th, 2012 at 9:19 pm

Posted in Retirement

Retirement asset mix – stocks, bonds and cash

Posted: at 9:19 pm


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I'm a 65-year-old retiree who has a comfortable pension and retirement savings that, for now at least, I don't need for living expenses. About a year ago I moved my savings into cash because I was worried about the unstable stock market and the crisis in Europe. I hate to see this money earn nothing, but I don't want to lose it if the stock market dives. Should I leave my savings in cash? Invest it in short-term bonds? Should any of it go into stocks? -- Don S.

Given all the turmoil in the economy and the financial markets the past couple of years, it's not surprising that you want to be careful about keeping your retirement stash secure.

But fleeing to cash to protect your savings is an ill-advised move that can backfire. In fact, in your case it already has.

Since you pulled out of the market a year ago, stocks have gained almost 10%, while bonds have returned roughly 7%. Which means that even the most conservative mix of stocks and bonds would have given you a much better return than, say, a money-market fund, which likely earned less than 0.1% over the past year. So in the short-term at least, your gambit didn't pay off.

As for the long-term, moving to cash and staying put would make your savings safer in the sense that your money will be insulated from the market's gyrations. But there's a big drawback as well.

Best Places to Retire

The returns on secure vehicles like savings accounts, money funds and the like barely keep pace with inflation over long stretches. After paying income taxes on gains, the real value of your savings could actually shrink as you age.

So if a dash into cash isn't the right way to go, what's a 65-year-old who doesn't want to see his nest egg scrambled to do?

Your first move should be to adjust your focus to the longer term. Right now, you're thinking only of how to protect your savings from what may happen in the market over the next few weeks or months.

Based on life expectancy for someone your age, you have a 50-50 chance of living another 20 years or so. And since life expectancy represents only the average life span, you have a good shot at living much longer. So even though you're retired, you should invest as if you'll be doing so for a long time. I generally tell retirees they should plan as if they'll live into their early 90s, longer if they come from a family with a history of longevity.

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Retirement asset mix - stocks, bonds and cash

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March 16th, 2012 at 9:19 pm

Posted in Retirement

The Standard Enhances Flexibility of Retirement Plan Services

Posted: at 12:31 pm


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PORTLAND, Ore.--(BUSINESS WIRE)--

Standard Retirement Services, Inc. (The Standard), now offers advisors more customized retirement plan solutions for their clients. After listening to feedback from the advisor community, The Standard has responded with a more flexible service offering in which advisors can now choose from a broader suite of services to select those services that best complement their practices and mitigate their risks.

The heart of our support has always been a service offering that allows us to adjust what we provide based on each advisors capabilities, said Dan Hall, vice president of Retirement Plan Sales. We believe this produces an alliance that complements the expertise that advisors bring to their clients while ensuring that the plan and its participants have access to a full range of services.

Advisors who partner with The Standard have the power to design a customized retirement plan solution that works to address each clients unique needs. This begins with The Standards essential plan services, which include recordkeeping and online tools, as well as employee services, including a participant call center, quarterly newsletter and enrollment communication materials.

Advisors can then select which additional services, if any, they want to provide to each client and which services they would like The Standard to handle. Advisors can choose from the following menu of services:

We realize that employers look to their advisors when it comes to choices for their retirement plans, Hall said. Advisors can look to The Standard and our flexible service offering for customized solutions that maximize the value that they can offer their clients and help employees reach retirement readiness.

Disclosure

StanCorp Equities, Inc., member FINRA, distributes group annuity contracts issued by Standard Insurance Company and may provide other brokerage services. Third-party administrative services are provided by Standard Retirement Services, Inc. Investment advisory services are provided by StanCorp Investment Advisers, Inc., a registered investment advisor.

About The Standard

The Standard is a leading provider of financial products and services, including group and individual disability insurance, group life, AD&D, dental and vision insurance, retirement plans products and services, individual annuities and investment advice. For more information about The Standard, visit http://www.standard.com.

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The Standard Enhances Flexibility of Retirement Plan Services

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March 16th, 2012 at 12:31 pm

Posted in Retirement

Rahul Dravid’s retirement press conference – Video

Posted: March 15, 2012 at 7:08 am


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09-03-2012 14:54 Rahul Dravid reflects on his career as he announces retirement from international cricket at his home ground, the Chinnaswamy Stadium, in a function room filled with more than 200 people Watch more videos like this at http://www.kyte.tv

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Rahul Dravid's retirement press conference - Video

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March 15th, 2012 at 7:08 am

Posted in Retirement

Magic number for retirement

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If you know how much money you need in the bank to comfortably retire, you're in the minority: Only one in 10 people makes such a calculation, according to the Transamerica Center for Retirement Studies. That might explain why, on average, Americans are on track to replace 60% or less of their income during retirement. Financial advisers generally agree that retirees need to replace 80% or more.

That means someone who brings home an $80,000 salary at the peak of his working years should save enough before retirement to generate at least $64,000 a year in retirement. An investment, such as an annuity, that generates a 3% annual return would require savings of at least $2.1 million to throw off that sum annually. (Retirees can also supplement their income by continuing to work, as well as with Social Security payments and pensions.)

For those who fail to stash enough away in advance, the consequences can be dire: The federal government estimates that 12% of women and 7% of men over 65 live in poverty. Couples fare better than single seniors; the poverty rate is highest among divorced and widowed women, at 21% at 15%, respectively.

In fact, more than half of Americans report having less than $25,000 in savings and investments, according to the Employee Benefit Research Institute, a nonprofit research organization. Just 13% of workers now say they are "very confident" they will have a comfortable retirement. The first step to joining that more self-assured group is to figure out just how much money you'll need. Here are six easy ways to do just that:

1. Use a calculator. Online retirement calculators can estimate how much you should have in the bank before retirement. Figure out if you're on track, based on current savings rates, or if you need to ramp up. "That first calculation is as frightening as it is a good one to scare you half to death on how much you have to save if you live to 90," says Nobel Prize winner and Stanford professor William Sharpe. (Are you saving enough for retirement? Check MSN Money's calculator.)

2. Take a shortcut to generate a ballpark figure. John Ameriks, head of Vanguard's investment counseling and research group, recommends estimating the amount you need in retirement by multiplying your current salary by 12. "People shouldn't get too comfortable until they have a number that's 12 or more times their current salary, so $600,000 for $50,000," he says.

3. Save 18%. That's the savings rate a medium earner ($43,084 in 2010) would need if he or she starts saving at age 35 and plans to retire at age 68 (assuming a 4% return on investments), according to Boston College's Center for Retirement Research. The center issued a brief that provides savings rates based on a variety of factors, including retirement age, rate of return, income and the age that contributions begin. (The savings rates would allow retirees to replace 80% of their working salaries, and the calculations factor in Social Security income.) The Employee Benefit Research Institute reports that on average, employees contribute just 7.5% of their income to their retirement accounts.

The analysis found that the two most important factors for creating a retirement nest egg are one's savings rate and the age of retirement. "If people could work until they're 70, they would have a much higher chance of having a secure retirement. Social Security is higher if you wait until age 70, and it gives your 401k assets a longer chance to grow, and it reduces the number of years you have to support yourself," says Alicia Munnell, the center's director. Less important was the rate of return earned on investments.

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Magic number for retirement

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March 15th, 2012 at 7:08 am

Posted in Retirement

Early Retirement Without a Fortune

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How 4 People Retired Early

For many people who suffered lackluster investment returns after enduring a highly volatile stock market, retirement has become an elusive goal. Some financial experts recommend that workers postpone retirement as wages stagnate, 401(k) portfolios underperform and pension plans go the way of the rotary phone.

However, some people have discovered that retirement is not as hard as it looks. With a bit of careful planning and dedication, that time of leisure can come earlier than 65 -- much earlier in some cases.

Bankrate profiled four people who managed early retirement at ages ranging from 33 to 52. None of them had the advantages of a family fortune, a lottery jackpot or an initial public offering, or IPO, windfall to support them. Instead, these retirees learned the importance of patient savings and cost-cutting while ignoring risky bets and avoiding trendy get-rich-quick schemes.

Satisfying Early Retirement

Bob Scottsdale, Ariz. Age: 62 Retired at 52

Bob began saving for retirement at 30, stashing away 15% to 25% of his annual income. He was able to amass $500,000 in a retirement fund by the time he stopped working just 22 years later.

Since then, he has kept that money in an IRA and lives on an annual pension of $40,000, which is about half of his pre-retirement income. That, combined with the inheritance of a modest estate from his parents, has given him a comfortable retirement.

However, his IRA portfolio lost $250,000 after the crash in 2008. He hopes to recover that money before he turns 64, when he intends on drawing on his IRA. The experience also taught him to simplify his life by cutting expenses and having less stuff.

Bob calls his investment approach "very conservative" -- he invested for long-term growth and avoided riskier investment opportunities. He also believes in cost-cutting on big items. For example, with the proceeds from a home sale, he bought his current house outright in cash to avoid having a mortgage. The biggest financial hurdle for him is medical care. He spends a quarter of his yearly income on health insurance alone.

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Early Retirement Without a Fortune

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March 15th, 2012 at 7:08 am

Posted in Retirement

Transamerica Retirement Services Ranked as the Top Provider Website for Retirement Plan Sponsors

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LOS ANGELES--(BUSINESS WIRE)--

Transamerica Retirement Services plan sponsor website earned the Excellent designation by DALBARs Defined Contribution WebMonitor program, outperforming the other 43 retirement plan provider websites rated in the program. Once again, Transamerica has garnered the top position in DALBARs analysis of provider websites for retirement plan sponsors, a recognition it has earned for nine consecutive calendar quarters. Transamericas plan participant website also earned the Excellent designation. Transamericas plan sponsor and plan participant websites have also been awarded DALBARs Seal of Excellence for seven consecutive years.

Transamerica remains fully committed to bringing the tools and resources that provide the best online experience for our plan sponsors and participants, said Stig Nybo, president of Transamerica Retirement Services. We are honored that DALBAR has once again recognized our commitment to providing plan sponsors and participants with the information they need to plan for a successful retirement.

In addition, DALBARs 2011 third quarter report highlighted Transamericas online resources that help plan sponsors understand and comply with 408(b)(2) fee disclosure regulations, including audio recordings addressing frequently asked questions.

DALBAR recognized Transamericas plan participant website for its ability to help retirement plan participants understand the benefits of automatic deferral increases, which can help retirement plan participants save more for retirement.

Each quarter, DALBAR identifies and recognizes industry-leading websites that attain a top 10 ranking. Websites are scored on results from DALBARs website evaluations and points are given for achievement in set criteria within the following five categories: functionality, usability, behavior centric attributes, content currency and consistency.

About DALBAR

DALBAR, Inc. is the financial communitys leading independent expert for evaluating, auditing and rating business practices, customer performance, product quality and service. DALBAR has earned the recognition for consistent and unbiased evaluations of investment companies, registered investment advisers, insurance companies, broker/dealers, retirement plan providers and financial professionals. DALBAR awards are recognized as marks of excellence in the financial community.

About Transamerica Retirement Services Corporation

Transamerica Retirement Services Corporation (Transamerica or Transamerica Retirement Services), which is headquartered in Los Angeles, CA, designs customized retirement plan solutions to meet the unique needs of small- to mid-sized businesses. Transamerica has more than 17,0001 retirement plans totaling more than $20 billion1 in assets. For more information about Transamerica, please refer to http://www.TA-Retirement.com.

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Transamerica Retirement Services Ranked as the Top Provider Website for Retirement Plan Sponsors

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March 15th, 2012 at 7:08 am

Posted in Retirement


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