As investors review their investments in the coming weeks, retirement planning is a priority, especially those strategies that involve year-end deadlines. Chris Hennessey identifies several areas that require action before December 31. Retirees age 70½ or older must take required minimum distributions (RMDs) from individual retirement accounts or 401(k) plans by December 31. The Internal
For 401(k) participants with a mix of pretax and after-tax funds in their retirement plan, planning may be easier following a recent announcement from the Internal Revenue Service. The IRS issued a notice in September that provides clarification on how to distribute these funds. Participants will be able to direct pre-tax funds to a traditional
It’s not too late for taxpayers to “undo” a Roth IRA conversion. The deadline to recharacterize — or reverse — the conversion is October 15. It’s an opportune time for advisors to review Roth assets with investors. In general, individuals have until October 15 of the following year to recharacterize a Roth IRA conversion and
“To see what is in front of one’s nose needs a constant struggle.” – George Orwell The Putnam Investments 2014 Lifetime Income Study, done in collaboration with Brightwork Partners, drew on data from over 4,100 working age adults (18 to 65 years of age) to comprehensively assess their potential to replace pre-retirement incomes. The survey
Changes in tax laws, cost of living differences, and the appeal of milder climates prompt many people to consider relocating. While there may be benefits — including financial benefits in some cases — the process can be complex. A person may have several residences, but he or she can only have one domicile or “legal”
Individual retirement accounts (IRAs) continue to comprise the largest segment of assets in the retirement industry. Most of the growth is driven by rollovers, creating opportunities for financial advisors working with clients who are deciding what to do with their 401(k) assets. Here are five ideas that advisors may use to try to grow their
With their growth rate expected to nearly double that of 401(k) assets in the next five years, individual retirement accounts (IRAs) continue to be a leading segment in the retirement industry. Here are some highlights of the growing IRA market: 1. The traditional IRA represents the largest share of U.S. retirement assets. In a 2014
Public employees, such as school teachers, slated to receive a pension may face challenges when planning for retirement, particularly if they hope to include Social Security as well. If a client works in a job that does not withhold Social Security payroll taxes, the receipt of a pension may eliminate or reduce Social Security benefits.
A recent decision by the United States Tax Court limits the number of IRA rollovers that an individual can do in a year. While the new ruling may cause confusion or concern for some clients, the limit does not apply to direct transfers. IRA owners may move funds from one IRA to another either by
Many savers are not sure how much money they can withdraw in retirement and help their savings last. In fact, 88% of participants in the Employee Benefit Research Institute’s 2014 confidence survey, said it would be valuable to receive a recommendation for a monthly withdrawal rate from the financial firm that handles their plan. Accumulating