Retirement Security

This very broad term that refers to the level of comfort you have with the resources that are intended to support you through retirement and provide a standard of living similar to what you experienced before retirement. Retirement security used to involve Social Security, a pension from a company plan, 401K and any other savings. However, volatile stock markets, rising unemployment, health care inflation, rising longevity, disappearing traditional pension plans and questions related to Social Security have redefined the traditional sources of retirement security. The question now is can you afford to retire? If so, is the money going to last long enough--especially now that we’re living longer? If you haven’t worked this out yet, consulting a retirement planning professional may help you figure-out things such as what might be a reasonable level of spending, when to start receiving Social Security and how much you need to save.

Variable Annuity Hedging Programs Holding Up Well

The hedging programs used by insurance companies to support the guaranteed living benefit features in their variable annuity products have held-up well recently. Milliman reports that insurance companies supported 94% of their guarantees for the six month period ending in March 2009. The success of the hedging programs and the highly volatile capital market environment have encouraged many insurers to increase their hedging efforts. As reported in an earlier post , the increase in hedging...

Glossary:

Annuity

Capital Market

Guaranteed Living Benefit

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Glossary:

Annuity

Capital Market

Guaranteed Living Benefit

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House Bill Would Impact Taxes on Annuities, IRAs and Longevity Insurance

A House bill introduced by Representative Earl Pomeroy, D-N.D., would affect the tax treatment of certain annuities and income from IRAs. H.R. 2748, the Retirement Security Needs Lifetime Pay Act, would create a tax exemption for 50% of the income drawn from a non-qualified annuity. The exemption would be capped at $10,000 per year. The bill would also create a 25% tax exemption for income payments from an individual retirement account (IRA). Last, the bill would exclude the value of longevity...

Glossary:

Individual Retirement Account

Income

Advanced Life Deferred Annuity

Required Minimum Distribution

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Retirement

Taxes

Longevity Insurance

Read more about House Bill Would Impact Taxes on Annuities, IRAs and Longevity Insurance
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Glossary:

Individual Retirement Account

Income

Advanced Life Deferred Annuity

Required Minimum Distribution

Key Phrases:

Retirement

Taxes

Longevity Insurance

Retirement Experts Working on 401k Plans that Allow for Test Drive of Annuities

Retirement experts are working through the Retirement Security Project in Washington to develop concepts that would increase annuity ownership within 401k plans. Concepts include providing 401k participants with the ability to test drive annuities through an "automatic trial income strategy." In other words, at retirement about half of a person's plan assets would be placed in a trial income plan that would pay out a monthly annuity income for two years. Participants would then have the ability...

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John Bogle Cautions on the Coming Retirement System Train Wreck

A very good article discusses Vanguard Founder John Bogle's views and work on the retirement system in the United States. Bogle is a highly vocal critic of the status quo: "Our nation's system of retirement security is imperiled, headed for a serious train wreck.That wreck is not merely waiting to happen; we are running on a dangerous track that is leading directly to a serious crash that will disable major parts of our retirement system." There are some interesting and surprising statistics:...

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Glossary:

Individual Retirement Account