I'm in my mid 60s and I'm rolling $1.5 million into an IRA. I'd like to create a portfolio of 60% stocks and 40% bonds using low-fee ETFs and mutual funds. Is this a good plan -- and which funds and ETFs would you suggest? -- Ollie F.

Your plan is spot on.

The real beauty of it is your focus on keeping investment expenses down, a strategy that has the potential to boost returns by limiting the portion of the your investment's gain siphoned off by the fund company.

Most people understand that lower costs and higher returns can help them amass more savings during a career, but I'm not sure people appreciate the benefit of that combination in retirement -- it can substantially reduce the danger of running through your savings too soon.

Let's say you plan to withdraw an initial 4%, or $60,000, from your $1.5 million at age 65 and then increase that amount for inflation each year. And let's further assume that your annual expenses run 1.5% a year, a ballpark figure for people who invest in mutual funds and the like.

Reducing your investing costs by half a percentage point to 1% a year can lower your probability of running through your savings before age 95 by roughly 25%.

Reduce your yearly investing expenses a full percentage point to 0.5% -- which is doable if you stick to ETFs and index funds with the lowest expense ratios -- and your chances of running through your dough within 30 years may decline almost by half.

25 Best Places to Retire

There's no guarantee that you'll be able to duplicate these results exactly. That's because even though lower-cost investments do generally lead to higher returns, you can't be certain of getting a full percentage point in extra gain for each percentage-point reduction in expenses. So your results will depend, among other things, on the return your investments earn net of fees.

But to whatever extent lower expenses boosts your returns, your savings are likely to last longer at any given withdrawal rate. And that's a big deal in retirement, when the last thing you want to do is run out of money before you run out of time.

Continued here:
Retirement IRA investing

WINNIPEG , March 28, 2012 /CNW/ - The Great-West Life Assurance Company commends the Quebec government for its proposed voluntary retirement savings plan (VRSP), the province's version of the federal pooled registered pension plan (PRPP) initiative, now in its third reading in Parliament.

"The VRSP offers a strategic framework for other Canadian provinces as they develop their own PRPP legislation," says Bill Kyle , Executive Vice-President, Wealth Management at Great-West Life. "We encourage all provincial governments in their efforts to help Canadians achieve retirement income adequacy by incorporating universal access, auto enrolment, auto escalation and locking in of contributions."

"The Quebec government's commitment to provide universal pension access to Quebec workers is critically important to the VRSP's success in Quebec ," Kyle says. "This same commitment to universal access will be key to making the PRPP a success in other provinces across Canada ."

VRSPs are expected to benefit Quebec workers by providing a plan structure to pool smaller employers' assets to allow these plans to benefit from economies of scale.

According to the proposal, which must still be passed into law, VRSPs will offer mechanisms to address issues identified as central to the retirement reform debate in Canada without disturbing existing employer-sponsored retirement plans. These mechanisms include:

As a leading provider of group retirement services for Canadians, Great West Life currently provides services to nearly 6,000 companies with five to 99 members. Great-West Life's experience will provide employers with a program that is easy to implement and administer - freeing them to focus on their day-to-day businesses.

About Great-West Life Great-West Life administers over 17,000 group retirement plans and over 1.2 million member accounts, representing nearly 30 per cent of capital accumulation plans (CAPs) in Canada . In the United States , Great-West is the fourth-largest group retirement plan recordkeeper based on total participants and Putnam Investments adds to the organization's North American presence in this market.

Go here to read the rest:
Quebec's proposed voluntary retirement savings plan offers a strategic framework for other provincial plans

People who have money left over after they fund their lifestyle and save the necessary amount for retirement every month often wonder what they should do next. Many people who ask me for advice about what to do with their extra income are trying to seek approval for their desire to inflate their lifestyle. Instead, I give them this checklist of things to consider before they start spending more:

Keep saving. Unless you came into a huge windfall, you probably don't have enough assets to say that you are saving too much. There are way too many unknowns to accurately say that you are saving too much for your future. There could be changes in your marital status, a growing family, a need to support your family financially, a dive in investment performance, and decades of inflation, just to name a few of the things that could disrupt your savings plan. During the first two decades of your working life, the best thing you can do for your financial life is to save as much as you can live with.

Reconsider your assumptions. Seriously think about whether you are really comfortable with what you've already accumulated for retirement. You can't assume that your income will grow consistently all the way until you are 65. You should stress test your retirement plan to see if your assumptions are really solid. What if you are laid off and don't have income for a year? What if your parents need financial support? Make sure you include the possibility of financial shocks in your retirement plan.

Consider lowering your risks. If you have an extra savings cushion, you might want to reduce the risks that you are taking with your investments. By owning more bonds instead of stocks, you are limiting your maximum upside, but you can also drastically lower the chances that an unpredictable economic event can ruin your financial cushion.

Buy an annuity. Another possibility is to buy a few annuities that guarantee payments for the rest of your life. Although some annuities have high costs, knowing that a check will always arrive like clockwork can help relieve financial stress, which is ultimately what comfortable living is all about.

Spend less time working. Instead of buying more stuff, you could spend less time working and gain more time to do what you actually enjoy. Many people in our society work long hours just to pay for their stuff, which is such a stressful way to live. If you've already saved enough for retirement, it's time to develop interests outside of your finances.

Spending more sounds great on the surface, but it's not always the best choice. Having more money than you know what exactly to do with is a great problem to have, but you shouldn't waste the opportunity to ultimately make your life better.

David Ning runs MoneyNing, a personal finance site that shares money moves you can make to significantly increase your chances of having a comfortable retirement. He likes to share simple changes that anyone can make, such as picking the best online savings account and figuring out whether a 0 percent balance transfer credit card makes sense.

More From US News & World Report

Read the rest here:
What to Do Once You Are on Track for Retirement

For many people, the idea of retirement elicits visions of a never-ending vacation, with the retiree choosing to do what they want to do, whenever they want to. But, the reality is that is not the case for a growing number of individuals; as many find that they have no choice but to work during what many consider 'retirement years.' If you find yourself forced to have a working-retirement, or even if you choose to work during retirement even when you don't have to, you might find the following tips helpful.

Convert Hobbies to Income Producing BusinessesYou are likely to be more accepting of having to work during retirement, if you enjoy your job. One way to do so is to convert hobbies that you enjoy into money making ventures. Some relatively inexpensive hobbies that have significant earning potential are: photography, art, pottery and gardening. One thing that you should keep in mind is that some of these hobbies will be time consuming, so make sure that you can manage your time efficiently to allow time to enjoy your retirement experience.

Stay Current with TechnologyTechnology is rapidly changing and employers are adapting by modifying business practices to benefit from these changes. If you fall behind in your knowledge and experience of how basic technology works, that could make it difficult for you to compete with other job seekers. If you are unable to afford to pay for courses, check out your local library or government institutions that offer education support for adults. Some libraries offer basic computer training as part of their community programs, and some government agencies include adult education as part of their social services programs.

Note: If you decide to start your own business, visit websites like http://www.sba.gov to get tips on starting and operating a business.

Engage in Lifelong LearningOne way to increase and maintain your competition with other job seekers is to continue your education. The level of continuation depends of how much education you have already gained in the area that you want to work. If you are changing careers, it may take you longer to complete your education, but it may be worth it in the end. Your options include technical and computer courses and general education. Many of these can be completed after hours if necessary, as well as during the daytime. If you decide to pursue this option, check to determine whether you are eligible for financial aid, which include student loans and grants.

Learn Industry JargonConvincing a potential employer that you are familiar with the job for which you are applying may require 'speaking the language' of the job. For example, if you are looking for a job as an accountant, make sure you know what terms like 'capital accounts,' 'general ledger' and subsidiary accounts mean. Being familiar with the jargon helps you to effectively engage in discussions, and explain why you are the perfect hire for the role.

Stay in ShapeAnother thing to keep in mind is your physical health. When you are retired, it's very easy to fall out of shape if you become inactive, which can cause lethargy and might cause others to perceive you as being lazy. Staying active helps to increase your energy level, and helps you to be productive. Your energy level could determine your ability to 'get the job done' efficiently and effectively, which may determine whether you keep the job you get.

The Bottom Line While you may feel the need to take on a few responsibilities in order to give yourself that extra retirement income that you need, you should always consider the fact that you are retired and make sure that you make time to enjoy your retirement years. If you feel that you don't have enough post retirement income to achieve your desired lifestyle, and must therefore continue working, take the steps to ensure that you are qualified to get the job that you want. They key is to maintain a balance, so that you can enjoy your retirement as much as reasonably possible.

More From Investopedia

Read more from the original source:
5 Steps To Embracing A Working Retirement

By Chris Taylor

NEW YORK (Reuters) - Don't look now, but your retirement savings plan may not be as ironclad as you think. It may even include some magical thinking.

That's because every retirement calculator features an "annual rate of return" that savers typically are asked to plug in for themselves. And the hard truth is, no one really knows how well their investments will perform in the future -- and that makes all our detailed retirement calculations seem kind of futile.

But here's something we do know: The good old days, when savers blithely counted on their retirement savings growing 7 percent or 8 percent or even 10 percent, year after year after year, are likely gone. In the New Normal, cautious investors are learning to revise their expectations downward.

People like Louis Berlin, for example. The Miami insurance salesman was one of those who piled into risky assets in the late 1990s, and thought he could rely on hefty annual stock gains.

"I thought those 90s rates of return were going to carry us all through, and then we had a Lost Decade," he says.

After losing hundreds of thousands of dollars in the dot-com bust, he settled on a new rate of return for the future: 3 percent. Or, when he's feeling a little devil-may-care, 4 percent.

"When people start expecting 8 or 10 percent a year, that's when they get into real trouble," says the 58-year-old, who currently keeps about half of his portfolio in equities. "People get carried away on the high side, and when reality hits they're unprepared. Then you have a whole decade of missed returns you have to make up."

REALISTIC OR MAGICAL?

So what's realistic when it comes to portfolio returns, and what's essentially magical thinking? After all, you have to put some number into those retirement calculators, even if it's just a back-of-the-napkin approximation.

Continue reading here:
Dangerous magic in your retirement plan

CHICAGO, March 28, 2012 /PRNewswire/ --Today the BMO Retirement Institute issued a report, Complementary Paths to Retirement: How men and women can learn from one another that finds that, when it comes to retirement, gender strongly influences the path men and women take to plan for that important life stage.

The report explores the different approaches men and women take to retirement, identifies additional challenges women must address, and suggests ways in which they can learn from each other.

"Despite the challenges that women face, we are seeing that they are actually more likely than men to enjoy their retirement," said Tina Di Vito, Head, BMO Retirement Institute. "Men and women have noticeable differences in how they respond to both financial and non-financial changes brought on by retirement, and women are proving that they have adapted the necessary skill set to help them cope with this transition."

Women Face Unique Challenges

The report notes that, for many women, retirement is often lived alone, whether by choice, or as the result of divorce or the death of a spouse.

Women must address unique challenges when planning for retirement such as longer life spans than men, and more intermittent work histories (women are more likely to interrupt their employment to act as family caregiver). These factors may result in lower earnings which, in turn, equate to lower pension benefits or 401(k) balances. Widowhood or divorce can also reduce women's retirement income. Moreover, women are statistically less likely than men to find a new partner if they find themselves alone in retirement.

What the Genders Can Teach Each Other

The behavioral differences exhibited by women and men can have a critical impact on their retirement planning. However, by capitalizing on each other's positive behaviors, which are very complementary, both sexes can better position themselves to have a more successful and fulfilling retirement.

The report found that women, in general, are less confident in their knowledge of finances and financial product/services than men. They also tend to be more risk averse than men, trade less frequently, hold less volatile portfolios and expect lower returns than men do.

Men's willingness to assume a reasonable level of risk allows them to achieve relatively higher growth in their retirement savings. Women could benefit from employing some of these behaviours in their retirement planning efforts.

Go here to see the original:
BMO Retirement Institute Report: How Men and Women Can Learn From One Another When Planning for Retirement

Video Link: https://www.youtube.com/watch?v=JQ297fgC7bg

27-03-2012 10:52 A retirement community in Florida caters to retired mail carriers with the US Postal Service. WSJ's Jennifer Levitz finds many prefer mail to email, and no dogs are allowed.

See the original post:
No More Mail, Dogs: Retired Postal Workers Rest - Video

NEW YORK (Reuters) - Companies that serve 401(k) plans are asking the Labor Department to reconsider its stance on mailed notification, so that they can save costs by using email instead of regular mail to send information to plan participants.

If the agency does not change its position, employees in 401 (k) plans will have to bear the additional mailing costs that can be substantial for plan participants, according to the March 27 letter from 15 industry trade groups.

"Presently, the increased costs attendant to paper disclosure in 401(k) plans could reduce participants' retirement savings, the very savings we are working to increase with enhanced transparency," the groups wrote in the letter.

Some record keepers estimate that the costs of paper-based statements could be $2 to $3 per employee, which would mean tens of thousands of dollars in added expenses for large employers, said Samuel Brandwein, a Morgan Stanley Smith Barney adviser who works with retirement plans.

"The purpose of the fee disclosure rules was to drive down costs for 401(k) plan participants," Brandwein said. "This could have the unintended consequence of driving up those costs."

Under Labor Department rules, employers who send materials through regular mail are safe from reprimand from the agency. But those who use email do not have such protection and could face potential lawsuits without a paper trail record.

This issue has been a thorn in the side of the retirement plan industry for years. It will become a much bigger issue this summer, when 401(k) plan providers will have to start disclosing the fees they charge to employees in these plans.

"With the new fee disclosure regulations, plan participants are going to get a lot more volume of materials," said Judy Miller, director of retirement policy for the American Society of Pension Professionals and Actuaries, one of the 15 groups that sent the letter to the Labor Department.

"This issue has really taken on new importance."

Other groups that joined with ASPPA in the letter include the Investment Company Institute, the American Bankers Association and the U.S. Chamber of Commerce.

See the rest here:
Retirement providers push for email for cost savings

We're taught our retirement years will be a period of unalloyed pleasure, a placid, decades-long stretch seldom roiled by the kinds of concerns, worries, and sleepless nights we face all too often over the course of our work lives.

In truth, the retirement years can be fraught with nervousness and fear. We may see our fixed incomes eroded by inflation, our pensions eliminated by corporate bankruptcy, our nest eggs decimated by stock market downturns, and the value of our homes cut dramatically by the vagaries of the housing market.

Far from being peaches and cream, retirement can sometimes be the pits. That's the lot of those who don't plan well for retirement. But - surprise! - it can also be true for folks who planned meticulously for their Golden Years.

If it takes a bit of the survivor mentality to navigate the years up to age 65, it's equally true that that mindset can come in very handy after retirement.

Retirement poster children

That's why I'd like you to meet a couple who managed to roll with the punches in their early retirement years, only to come out the other side a bit bruised but otherwise unbowed. That couple is Carol and Phil White.

After finding retirement can be a tad thorny, they made the proper adjustments and came out smelling like a rose. The proof? When I caught up with Carol this week for the first time in a year, she and Phil were soaking up some sun on the beach in Kauai while visiting family in Hawaii.

As they approached the idea of retirement, the Whites felt they were well positioned to take the plunge while still in their 50s. Carol had spent her work life in the corporate world, earning a traditional pension and accumulating retirement assets in a 401k, as well as investing in a stock purchase plan. Phil, by contrast, had been an independent businessman. He owned a couple IRAs, and knew he could reap substantial income from the sale of his upscale men's clothing store.

The icing on top of this cake of retirement assets was a pair of single-family homes the Whites had purchased for the rental income they generated.

Retire like it's 1999

Read more:
Roll With the Retirement Punches

WHITE PLAINS, N.Y., March 28, 2012 /PRNewswire/ --Pete Swisher, CFP, CPC, TGPC has joined Pentegra Retirement Services as Senior Vice President, National Sales, announced Robert C. Albanese, Pentegra Retirement Services President and CEO.

Mr. Swisher brings more than 15 years of industry expertise to Pentegrawith a background that not only includes in-depth knowledge of retirement plan operations and business models but also vast expertise working with financial advisors to build successful retirement practices.

Stated Mr. Albanese, "Pete is well-known nationally as one of the industry's top retirement plan experts, and is a well-respected speaker and thought leader within the retirement community. With extensive experience in all facets of the business, we believe he will play a key role in helping us take this organization to a new levelparticularly in terms of his ability to help position Pentegra for accelerated growth and expanded presence in the advisor-sold space. We are delighted to have him join our team, and I believe the entire organization will benefit greatly from Pete's knowledge and experience."

Prior to joining Pentegra, Mr. Swisher was with Unified Trust, where he was Vice President of Advisor Services and Senior Institutional Consultant, instrumental in taking the organization from a $600 million provider to a $2.8 billion brand. He is the author of 401(k) Fiduciary Governance: An Advisor's Guide, the textbook for ASPPA's Qualified Plan Financial Consultant credential (QPFC). Through his ERISA Boot Camp Workshop Series, he has helped advisors throughout the United States build successful pension practices based on a transparent fiduciary service model.

As a passionate advocate for the private pension system and national retirement income security, he is actively involved with the National Association of Plan Advisors (NAPA), ASPPA, and ASPPA's Political Action Committee. Pete is the Chair of the NAPA Government Affairs Committee.

Mr. Swisher graduated from the University of Virginia in 1988, where he was selected for the prestigious Echols Scholar Program. He accepted a commission in the U.S. Marine Corps and served in the first Gulf War as Executive Officer of an infantry company. He left the Marines as a Captain in 1993.

He lives with his wife, Shannon, and three children in the horse country of Central Kentucky.

Mr. Swisher may be contacted at 800-872-3473, or by email pswisher@pentegra.com.

Pentegra Retirement Services is a leading provider of retirement plan solutions to organizations nationwide. Founded by the Federal Home Loan Bank System in 1943, Pentegra offers a full range of retirement programs, including 401(k) plans, Defined Benefit Pension plans, Cash Balance plans, 412(e)(3) Fully Insured Defined Benefit plans, Split Funded Defined Benefit plans, KSOPs, ESOPs, Profit Sharing plans, Age-Weighted plans, New Comparability plans, 457(b) and 457(f) plans, 403(b) plans, 401(a) plans, Nonqualified Executive Benefit and Director plans and a broad array of TPA services.

For more information, go to http://www.pentegra.com.

Read more:
Pete Swisher Joins Pentegra Retirement Services