New Study Suggests an Unconventional Approach May Help Boomers Prolong Retirement Savings
Posted: February 7, 2012 at 3:02 am
SAN DIEGO, CA--(Marketwire -02/06/12)- Brandes Investment Partners today released a new study by the Brandes Institute suggesting ways for investors to improve their financial prospects in retirement, including reducing the risk of outliving their assets ("money death"). The baby boom generation is now moving towards retirement age while longevity estimates suggest that their retirement may last much longer than expected. The study suggests that many of America's baby boomers could increase their retirement assets at advanced ages by maintaining a larger portion of their portfolios in higher-potential investments such as equities (rather than re-allocating prematurely into fixed income) and managing the risk of money death by investing a modest portion of their portfolio in longevity insurance. The study comes on the heels of the U.S. Treasury's plan to make it easier for defined contribution plans and IRAs to offer annuity options.
"Retirees in good health have a risk of outliving their assets regardless of their investment strategy. Our study suggests they may do better by aiming for superior long-term returns in their investment portfolios and dealing with money death risk separately," said Barry Gillman, Research Director, Brandes Institute Advisory Board. "This contradicts the conventional wisdom, which tells people to play it safe when they retire by moving a large portion of their portfolio to bonds.
"One problem with the conventional approach is that about 60% of the money distributed from typical retirement accounts should come from investment returns earned after retirement. Today's historically low yields are just not providing the returns retirees will likely need to sustain them.
"Until now, this approach has not been widely understood or used even by the healthy and wealthy individual investors who stand to benefit from it most. With the Treasury's new initiative to tear down some of the barriers to investing retirement savings in annuities, this could also become a practical solution for many participants with 401(k) and IRA savings."
The study cites evidence generated by the Brandes Retirement Simulator, a proprietary online model that projects a range of long-term asset outcomes based on an individual's personal finances and expected lifespan, as well as portfolio allocations and investment assumptions, and the use of longevity insurance. The full study is available on the firm's website at http://www.brandes.com/institute. Access to the Brandes Retirement Simulator will soon be available on the firm's website at no cost to retirees and advisors who can customize the inputs and integrate it into their retirement planning.
About Brandes
Brandes Investment Partners is a global investment advisory firm based in San Diego and along with its affiliates, manages more than $32 billion of assets as of December 31, 2011, for institutional and private clients worldwide. Since its inception in 1974, Brandes has applied the value investing approach to security selection pioneered by Benjamin Graham. Among the first investment firms to bring a global perspective to value investing, Brandes manages a variety of investment strategies.
Brandes Investment Partners, L.P. is a U.S. registered investment adviser. Brandes does not sell or endorse any insurance policy. More information can be found at http://www.brandes.com.
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New Study Suggests an Unconventional Approach May Help Boomers Prolong Retirement Savings
Children’s Hospital Boston Achieves Dramatic Employee Retirement Savings Improvement after Consolidating Benefits with …
Posted: at 3:02 am
BOSTON--(BUSINESS WIRE)--
Fidelity Investments®, the leader in helping employees of health care organizations save for retirement1 , announced today that Children’s Hospital Boston dramatically improved the number of employees participating in its workplace retirement savings plan after consolidating plan administration solely with Fidelity last year. At year-end 2011, 95 percent of Children’s Hospital Boston’s 9,400 eligible employees were participating in the plan, up from 37 percent at the end of 20102 -- an unprecedented 160 percent increase. Fidelity services all the hospital’s nearly 11,000 retirement plan participants, including both current employees and retirees.
Together, Children’s Hospital Boston and Fidelity developed an innovative and comprehensive approach to serving the diverse needs of Children’s Hospital Boston employees and retirees. The offering includes comprehensive investment guidance, proactive and multi-touch communications, automatic enrollment of all new employees, and re-enrollment of those who were not in the retirement plan at year-end 2010. This powerful combination of automatic enrollment, guidance and engaging communications programs designed to meet the specific needs to Children’s Hospital Boston employees and retirees helped drive the hospital’s exceptional participation rate increase.
“At Children’s Hospital Boston we are committed to providing our employees and retirees with high-quality service and investment guidance to help them achieve their retirement goals,” said Dawn Socha, director of benefits for Children’s Hospital Boston. “We are thrilled with the progress that has been made with the innovative program we developed with Fidelity.”
“Fidelity is proud to be the sole retirement plan provider for Children’s Hospital Boston, an organization synonymous with building better futures for children and their families,” said John Ragnoni, executive vice president, Tax-Exempt Retirement Services, Fidelity Investments. “We are excited to work with Children’s Hospital Boston to develop and implement a program that has been so successful in helping their employees get on the path to reaching their long-term financial and retirement goals.”
Tailored Investment and Retirement Guidance
Fidelity’s comprehensive guidance programs help Children’s Hospital Boston participants across all ages and employment tenures make educated investment decisions. Programs include one-on-one consultations by phone or in person at Children’s Hospital Boston locations or at one of Fidelity’s eight Greater Boston Investor Centers. Participants also benefit from a wide range of onsite and online workshops and webinars, plus Fidelity’s full suite of online planning tools. In 2011 alone, more than 75 onsite workshops were offered at regional Children’s Hospital Boston locations across Massachusetts and New Hampshire.
Three distinct age-based workshops provide educational investment guidance tailored to participants in various life stages:
For participants ages 25-40, workshops focus on enrolling in the plan, setting a deferral rate and financial topics beyond retirement planning, such as day-to-day budgeting. Guidance for participants ages 40-55 helps ensure optimal asset allocation and goal setting. For participants ages 55 or older, workshops are available to help participants prepare for retirement by creating a comprehensive retirement income plan. This includes getting to know the participants and their retirement goals, helping to create a retirement “paycheck” and explaining ways to help protect against taxes, inflation and rising health care costs.
About Fidelity Investments
Fidelity Investments is one of the world’s largest providers of financial services, with assets under administration of $3.4 trillion, including managed assets of $1.5 trillion, as of December 31, 2011. Founded in 1946, the firm is a leading provider of investment management, retirement planning, portfolio guidance, brokerage, benefits outsourcing and many other financial products and services to more than 20 million individuals and institutions, as well as through 5,000 financial intermediary firms. For more information about Fidelity Investments, visit http://www.fidelity.com.
Fidelity Brokerage Services LLC, Member NYSE, SIPC
900 Salem Street, Smithfield, RI 02917
Fidelity Investments Institutional Services Company, Inc.
100 Salem St., Smithfield, RI 02917
Although consultations are one on one, guidance provided by Fidelity is educational in nature, is not individualized and is not intended to serve as the primary or sole basis for your investment or tax-planning decisions.
604124.1.0
© 2012 FMR LLC. All rights reserved.
1 Based on 2011 data sourced from LIMRA and Fidelity Market Insights Group.
2 Fidelity business data as of January 9, 2012.
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Children’s Hospital Boston Achieves Dramatic Employee Retirement Savings Improvement after Consolidating Benefits with ...
How Ethnicity Affects Retirement Savings
Posted: at 3:02 am
Ethnicity is a growing area of interest for banks, largely because they want to understand their customers better.
[50 Ways to Improve Your Finances in 2012]
By 2050, says Fred Makonnen, vice president of multicultural sales at ING, African Americans, Hispanics, and Asian Americans will make up the majority of the U.S. population, compared with just over one-third now. “We need to have, as an industry, products that can speak directly to these consumers. We’re seeing time and time again there is a significant gap between various ethnic groups … and the reasons tend to be embedded in cultural differences,” he says.
While he’s quick to add that the study reveals more similarities than differences, African American and Hispanic respondents tend use shorter time horizons when it comes to financial planning, which, he says, can get in the way of saving enough for retirement.
A new ING study, which was commissioned by the ING Retirement Research Institute and polled households with incomes over $40,000, found that 31 percent of African Americans, a higher percentage than any other group, list debt as an obstacle to saving, but they also were more financially prepared in certain areas, such as life insurance coverage. The study found that 1 in 4 African American respondents had life insurance valued at four to five times their current salary, compared with just 18 percent of total respondents.
The ING study also found that Hispanic respondents were more likely to sacrifice their own financial future for their children, a choice Makonnen says is most common among first-generation immigrants. “If you’re first-generation, the family unity is much stronger, especially in the Hispanic community. Over time, you’ll see less and less of that leaning on family as a financial security blanket,” he says.
A recent Washington Post-Kaiser Family Foundation poll similarly revealed that African American women are more likely to loan money to family or friends compared with white women (60 percent versus 52 percent) and to help friends or family with child care on a regular basis (36 percent versus 24 percent for white women).
In the ING study, Asian American respondents were the most prepared for retirement; on average, they had built savings of $81,000 in employee-sponsored plans, such as 401(k)s and $58,000 in other types of savings vehicles, such as CDs and IRAs. By comparison, Hispanic respondents reported having just $54,000 saved in retirement savings accounts.
Meanwhile, Asian American respondents demonstrated a different weak spot: estate planning. They were the least likely group to have a last will and testament (26 percent) compared with 37 percent of white respondents. Asian-American respondents were also more likely to prioritize splurges such as a nice car or home, over retirement savings. “Overall, Asians seem to believe that purchasing short-term goods and materials is a sign of success, and having physical possessions is very important,” says Makonnen.
[10 Ways to Save Your Retirement]
The ING study clearly demonstrated that the challenge of saving for retirement cuts across all ethnic groups. Close to half of all ethnic groups said they feel unprepared for retirement, ranging from 54 percent of Hispanic respondents to 44 percent of Asian American respondents. And when it comes to planning, close to 30 percent of all groups reported having formal investment plans, ranging from 28 percent for white respondents to 32 percent for African American respondents.
These findings suggest to Makonnen than banks can provide better tools and resources to reach out to certain groups to help them plan for retirement, he says. He works with historically black colleges and universities, for example, to launch “culturally-relevant” financial literacy programs. Because the study found that Hispanic and African American respondents were especially likely to look to their employers for retirement planning assistance, he also wants to investigate how ING can help employers with that. “[Employees] are not going to seek out information if they’re not in their comfort zone,” he says.
Among all groups, Makonnen adds, “We’re seeing less emphasis on planning going forward.” That’s a trend he wants to help reverse.
Twitter: @alphaconsumer
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How Ethnicity Affects Retirement Savings
Thought of the Day: Conversations create Momentum – Video
Posted: at 3:01 am
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Military Wives' Success Leads To Album Plans
Posted: at 3:01 am
Gareth Malone and the Military Wives' Christmas Number One single raised over £500,000, it has been announced, as the choir reveals plans to release an album.
The women presented a cheque for £503,985 to their two nominated military charities, The Royal British Legion and SSAFA Forces Help.
The money was raised through sales of their record breaking single Wherever You Are, which was written by royal wedding composer Paul Mealor using lines from the wives' love letters to their serving husbands in Afghanistan.
Malone told Sky News he is so proud of what they have all achieved.
"It means so much to me personally because this is the biggest thing I've ever done. I can't top this. I'm so proud of the association with these women," he said.
"They're incredible for what they achieve on a daily basis but this has just distilled into something that the nation will never forget."
One of the wives, Laura Thompson, says it is a very special day for all of them.
"It's just amazing, I'm so proud to be part of something that helps other people, I'm in awe," she gushed.
Susie Brady, whose husband and son are serving marines, added that their families are all delighted with their achievement.
"They can't believe it, it's something so out of the ordinary for us, they're very proud.
"Obviously we didn't expect any of this so to have a single and an album and to raise so much for charities that are so personal for us - I'm over the moon."
Their follow-up album In My Dreams will be released in time for Mother's Day and is named after a new Paul Mealor song on the album.
It will also include the hit single Wherever You Are and Adele's Make You Feel My Love.
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Military Wives' Success Leads To Album Plans
Divorce not fazing Lindsey Vonn
Posted: at 3:01 am
Updated Feb 6, 2012 7:15 PM ET
Lindsey Vonn is shining on the slopes and outracing the struggles in her personal life.
The Olympic downhill champion may be going through a divorce with her husband and may be dealing with persistent rumors over who she's dating, but the distractions have hardly affected her performance on the hill.
Vonn is off to one of the best starts of her career, leading the World Cup overall standings by a whopping 482 points as she tries to claim the title back from friend and top rival Maria Hoefl-Riesch of Germany.
Over the weekend, the 27-year-old Vonn reached yet another milestone — earning her 50th career victory during a dramatic downhill run in Garmisch-Partenkirchen, Germany, where she momentarily went down on her hip, only to spring back up and glide through the finish like nothing had even happened.
With that, she joined a select few to reach the hallowed mark. Among the women, only Annemarie Moser-Proell of Austria (62) and Vreni Schneider of Switzerland (55) are ahead of Vonn.
On the men's side, just three have reached 50 wins: Ingemar Stenmark of Sweden (86), Hermann Maier of Austria (54) and Alberto Tomba of Italy (50).
To even be mentioned in the same sentence as Tomba was quite flattering for Vonn.
"I never dreamed I would have reached the success that they've reached in their careers," Vonn said. "I still have a lot of years of racing in me. I never expected it."
These days, the slopes have become Vonn's sanctuary, her refuge from what's going on in the rest of her life. Earlier this season, she separated from Thomas Vonn, her husband of four years and her personal coach. Gone were the little things, too, like how he always made sure she didn't conduct too many interviews or attend too many functions.
She realizes the integral role he played in her development.
"He has done a lot to help me. We made a great team together," said Vonn, who's won nine races this season.
Although they no longer work together, he's proud of her success.
"I'm really happy for Lindsey, 50 World Cup wins is an amazing accomplishment," Thomas Vonn wrote in an email to The Associated Press. "I know firsthand how much hard work went into this, and that it did not come easy. I have no doubt that 50 wins is just the beginning for her and that she will go down in history as one of the greatest skiers of all time."
After the breakup, Lindsey Vonn began working with another coach, Jeff Fergus, who has been with the U.S. speed team for six years.
"No matter who my coach is, I still know how to ski race," Vonn said. "It's definitely been difficult in many ways. It' a different routine now, different coaches around, different emotions. There are different personal aspects that I have to take care of every day that are not fun. That's what my life is now.
"But I know how to ski no matter what the situation is. I don't think that will ever change."
Vonn also is in the process of rekindling her relationship with her father, Alan Kildow, after a falling out a few years ago. He was the person who introduced her to skiing and even moved the family from Minnesota to Colorado to hone her talent.
And he was on hand to see his daughter capture such an historic win.
"It's something special to get 50 wins, but even more special to share that with your family," she said.
And not to mention teammates. Her struggles away from the race course have brought her closer to the squad. They've been a shoulder to lean on through the hard times.
"They realize how difficult this situation is for me," Vonn said. "It's brought us as a team of girls closer together. I just feel like the attitude and energy on the team is really good right now.
"It's been really great for me to have so much support from everyone, from my teammates and coaches. I definitely wouldn't be able to do it without them."
Vonn has been dialed in with very little rattling her on the course. Part of that has to do with her health — other than a sore back earlier this season, she's been basically injury free — and the rest to her determination.
"When I'm in the starting gate, I'm not nervous at all. I know what I have to do to ski well and I just go out there and do it," Vonn said. "I don't really second guess myself.
"I think that's the reason why I've had more success this year than maybe in past years."
Plus, there's always this incentive dangling in front of her — getting her crown back. Vonn lost last season when Hoefl-Riesch beat her by three points after the season's final race was called off because of poor course conditions.
She's attempting to lock this title up early so that it doesn't come down to Mother Nature again. Vonn has accumulated 1,350 points so far this season, putting her ahead of Slovenia's Tim Maze (868) and Hoefl-Riesch (796).
Soon, Vonn & Co. will be heading to Sochi, Russia, to test out the Olympic course. Vonn can't wait to catch a glimpse of the slope where she will try to defend her downhill title.
"I'll ingrain it in my mind," Vonn said. "I'll do the same thing as Vancouver and visualize it over the next two years and hopefully be ready for the Olympics in 2014."
For now, she will keep her focus on smoothly gliding down the slopes even with her turmoil away from the mountain.
"I feel like no matter what's going on in my personal life, I can always put my skis on and go out and clear my mind and really have fun. Skiing has been honestly the best thing for me at this point in my life," Vonn said. "It's hard to describe. Things, on the personal front, they're not any better than they were a few months ago.
"But I feel very clear minded when I'm skiing and I am enjoying it more than I ever have."
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Divorce not fazing Lindsey Vonn
Vonn off to fast start, opens big World Cup lead
Posted: at 3:01 am
Published: Monday, Feb. 6, 2012 4:30 p.m. MST
Lindsey Vonn is shining on the slopes and outracing the struggles in her personal life.
The Olympic downhill champion may be going through a divorce with her husband and may be dealing with persistent rumors over who she's dating, but the distractions have hardly affected her performance on the hill.
Vonn is off to one of the best starts of her career, leading the World Cup overall standings by a whopping 482 points as she tries to claim the title back from friend and top rival Maria Hoefl-Riesch of Germany.
Over the weekend, the 27-year-old Vonn reached yet another milestone — earning her 50th career victory during a dramatic downhill run in Garmisch-Partenkirchen, Germany, where she momentarily went down on her hip, only to spring back up and glide through the finish like nothing had even happened.
With that, she joined a select few to reach the hallowed mark. Among the women, only Annemarie Moser-Proell of Austria (62) and Vreni Schneider of Switzerland (55) are ahead of Vonn.
On the men's side, just three have reached 50 wins: Ingemar Stenmark of Sweden (86), Hermann Maier of Austria (54) and Alberto Tomba of Italy (50).
To even be mentioned in the same sentence as Tomba was quite flattering for Vonn.
"I never dreamed I would have reached the success that they've reached in their careers," Vonn said. "I still have a lot of years of racing in me. I never expected it."
These days, the slopes have become Vonn's sanctuary, her refuge from what's going on in the rest of her life. Earlier this season, she separated from Thomas Vonn, her husband of four years and her personal coach. Gone were the little things, too, like how he always made sure she didn't conduct too many interviews or attend too many functions.
She realizes the integral role he played in her development.
"He has done a lot to help me. We made a great team together," said Vonn, who's won nine races this season.
Although they no longer work together, he's proud of her success.
"I'm really happy for Lindsey, 50 World Cup wins is an amazing accomplishment," Thomas Vonn wrote in an email to The Associated Press. "I know firsthand how much hard work went into this, and that it did not come easy. I have no doubt that 50 wins is just the beginning for her and that she will go down in history as one of the greatest skiers of all time."
After the breakup, Lindsey Vonn began working with another coach, Jeff Fergus, who has been with the U.S. speed team for six years.
"No matter who my coach is, I still know how to ski race," Vonn said. "It's definitely been difficult in many ways. It' a different routine now, different coaches around, different emotions. There are different personal aspects that I have to take care of every day that are not fun. That's what my life is now.
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Vonn off to fast start, opens big World Cup lead
Success of personal finance course prompts second session
Posted: at 3:01 am
(Sarah Reed/Democrat-News)
More than 40 people took the first steps in gaining control of their finances this past fall. After seeing the results, Marshall Nazarene Church will once again host Dave Ramsey's Financial Peace University.
Starting Wednesday, Feb. 15, at 6:30 p.m., the 13-week program taught by DVD teaches participants how to save for emergencies and create a household budget to get out of debt.
More than 1.5 million people nationwide have taken advantage of Ramsey's program, according to FPU/The Lampo Group, Inc.
In a press release issued Jan. 31, Ramsey said: "FPU is a fun and easy to understand program. Whether you are deeply in debt or financially secure, FPU will help you gain a new perspective on how to handle your money."
Marshall participants felt they needed that direction. Out of 22 anonymous residents there was almost $780,000 worth of collective debt.
"We had 23 couples last time," Melisa Grossenburg, the local program coordinator, said. "We are very pleased with how the last session went and are very excited about our new class ..."
Many past participants are seeing results and at least one couple is now debt free, according to Grossenburg.
Classes for the free program meet once a week at the church, located at 782 W. North St. Participants will only need to purchase a kit, which includes a workbook, an envelope system, audio lessons, Ramsey's book "Financial Peace," a lifetime membership to FPU and more. The kits can be purchased at the church at a discounted price, through http://www.daveramsey.com or by calling 888-227-3223. Marshall Nazarene Church is located at 782 W. North St., near the intersection of Arrow Street and Miami Avenue, and can be reached by calling 660-886-6464.
Contact Sarah Reed at
sreed@marshallnews.com
Related story:
Marshall residents 'dump debt,' seek financial security
http://www.marshallnews.com/story/178529...
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Success of personal finance course prompts second session
Parents: DimensionU Educational Allowance – Video
Posted: at 2:59 am
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Parents: DimensionU Educational Allowance - Video
Current Student Shares Experience with CSU’s Online Adult Education and Training Master’s Degree – Video
Posted: at 2:59 am
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Current Student Shares Experience with CSU's Online Adult Education and Training Master's Degree - Video