403(b)s, Keogh, and Other Plans

A 403(b) plan, also known as a tax-sheltered annuity (TSA) plan, is a retirement plan for certain employees of public schools, employees of certain tax-exempt organizations, and certain ministers. Learn more about 403(b) plans here.

Should retirees take the pension, or 'the lump?'

Jennie L. Phipps Mar 18th 2010 @ 10:00AM EST Filed Under: Retire, Investing, Retirement Advice

Given the choice, should a soon-to-be-retiree take the monthly company pension or the whole pension amount at once - known as "the lump?"

Entire taverns can be polarized by this question.

The guys down at Buster's Hideaway are staunch in their belief that taking the lump will separate them and their money from their soon-to-be former employers -- a good thing in their view because they fear that their employers might renege on their monthly obligations.

I have a brother-in-law who is among those at Buster's facing this decision and he would really like to go for the lump - he's none too trusting of the company he's worked for more than 30 years. But he can't get beyond the nagging fear that he'll take the money and lose it.

At the risk of overstepping my familial bounds, I researched and wrote about the question for Bankrate.com, where I'm a contributing editor. In my Bankrate report. I tried to present both sides of the question fairly because that's the journalistic thing to do. But I'll tell you here, if my husband and I had to make that decision, I'd be lobbying hard for the monthly pension - despite the fact that my husband is an accountant for an insurance company and an expert in financial management.

Continue reading Should retirees take the pension, or 'the lump?'

Economy better, but return of conspicuous consumption is not good news

Marc Acito Mar 15th 2010 @ 5:00PM EST Filed Under: Debt, Retire, Saving Money, Wealth, Recession

Am I the only American who's disappointed the economy's getting better?

I know it doesn't make sense -- I myself have been so underemployed these last two years it makes me nostalgic for the soul-sucking sales job I hated so much I wanted to chew off my arm to get out. (It turns out all those relatives who lived through the Depression were right -- that was a good, steady job.) So you'd think I'd be sending love notes to Timothy Geithner at the news of unemployment holding steady at 9.7% while retail sales increase.

Continue reading Economy better, but return of conspicuous consumption is not good news

Recession delaying retirement for 'Middle Boomers'

Aaron Crowe Mar 11th 2010 @ 2:00PM EST Filed Under: Family Money, Retire

More Middle Boomers -- those 52 to 58 years old -- expect to work about five years beyond their planned retirement date, thanks to the recession, according to a new study of that segment of 29 million people.

The "MetLife Study of Boomers in the Middle" showed 54% saying they were behind in their retirement-savings goals. Economic conditions have hurt 76% of those surveyed, and almost half of those are concerned about their ability to recover.

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How not to be a retirement statistic

Ron Dicker Mar 9th 2010 @ 4:30PM EST Filed Under: Retire, Retirement - 401(k), Retirement Advice

If you're among the newly reported 43% of American workers who do not have more than $10,000 in retirement savings, you better keep reading. WalletPop has immediate tips to get you on the right track toward life after work. The first piece of advice: Don't panic.

"Many people have been forced by weak markets and the recession to have a do-over in their financial lives," Mitchell Slater, a senior vice president and financial adviser for Morgan Stanley Smith Barney, told WalletPop on Monday.

"Try not to stress out too much and just, as Nike says, do it. The younger you are, the better the news is for people worried about not saving enough for retirement."

Continue reading How not to be a retirement statistic

Staying on the job is marital therapy for Boomers

Jennie L. Phipps Mar 8th 2010 @ 10:30AM EST Filed Under: Retire, Retirement Advice

Everywhere I look, I see another news story bemoaning delays in retirement plans for Boomers. Most of them feature some poor schmo who says he's going to be working until they haul him off the job toes up.

It's hard for me to be too sympathetic. Part of the reason is that I'm a woman. I spend a lot of time around other women whose husbands are retired or contemplating it and my conclusion is that they would do almost anything to keep the poor dear on the treadmill.

It doesn't have much to do with money, although healthcare is a factor. Many women are younger than their husbands and when he retires, she will have to find private health insurance and it almost certainly won't be as good as she had before.

But the real issue is that if he stays home, he'll drive her nuts. As one of my friends said, "If he retires, I can't stand it. I'll have to go live with my sister in Indiana."

Continue reading Staying on the job is marital therapy for Boomers

Home builders take aim at the 55-plus crowd

Charles Feldman Feb 15th 2010 @ 1:00PM EST Filed Under: Real Estate, Retire, Recession, Mortgages

In just four years, roughly one fourth of the U.S. population will be 55 or over -- that translates into some 85 million Americans.

So it is little wonder that home builders are reportedly taking aim at these aging baby boomers in an effort to increase sales at a time of great uncertainty and fiscal pain throughout the real estate market.

"In general, we're seeing very positive response among this buyer group," says Chris Naatz, the Midwest-area director of marketing for Pulte Homes, in an interview with the Dallas Morning News.

There's even an on-line magazine you can buy that is focused on this particular segment of the home buying public.

Back in June of 2009, according to a news release on the website of the National Association of Home Builders, the association's chief economist, David Crowe, said, "A strong and growing number of retirees and empty-nest households are interested in either downsizing or moving to a more user-friendly home -- especially if it's near their existing community."

But he went on to caution that the market conditions, as they existed this past summer, were such that it still presented "significant obstacles" to the 55-plus potential home buyer because of the difficulties in selling their current home.

Continue reading Home builders take aim at the 55-plus crowd

Is Baby Buffett a bargain?

Sarah Coffey Feb 12th 2010 @ 6:00AM EST Filed Under: Retire, Wealth, Investing

Good news, average investors: You too can now afford a share of Warren Buffett's coveted Berkshire Hathaway stock, thanks to a 50-to-1 stock split that cut the price of shares from $3,500 to around $76.

Of course, that's Warren's B shares. Most of us can still only fantasize about owning Berkshire's A stock, which last traded at $114,950 a share.

But is it still a good deal? So far, yes. The B shares have shot up 5.46% since the split, at a time when the Standard & Poor's 500 sank 3.4%.

Stock splits do absolutely nothing to change the fundamentals of the company. If you owned one share of the B stock before the split, you now own 50 at 1/50th of the value. But the split does seem to have given a psychological boost to the stock, as well as making it more affordable to the masses.

The split also means it is now being widely traded, a requirement for the company to be included in the S&P 500. Berkshire is expected to be added to the blue-chip index after market close today, once Buffet's deal to purchase railroad Burlington Northern Santa Fe is completed. The merger is expected to close today.

Gap between 'mature' buyers and builders

Amy Pyle Jan 27th 2010 @ 5:00PM EST Filed Under: Home, Real Estate, Retire, Technology, Transportation, Retirement Advice

Older home owners and the builders of senior housing have a bit of a communication gap, according to a recent survey.

These potential buyers say they want non-slip floors but don't much care about lever doorknobs. Builders say they have those easy-to-open knobs covered but aren't so sure about the floors.

The builders are going green; the buyers say great -- but won't pay extra for it. A third of the consumers want lower kitchen cabinets, emergency call buttons and wood-burning fireplaces. Only about one in 10 providers routinely offer those amenities. Three-quarters of the suppliers build wider doorways; only half the consumers want them.

That supply-and-demand chasm for senior housing was unearthed by the survey, titled "55+ Housing: Builders, Buyers and Beyond".

WalletPop wondered how the results might change builders' plans. But the response of one of the survey's sponsors, MetLife, is, basically, that consumers don't know what's good for them.

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Baby Boomers and high-income seniors bear burden of Medicare increase

Lita Epstein Jan 21st 2010 @ 8:00AM EST Filed Under: Retire, Health, Insurance - Health Insurance

Most seniors will not see their premiums for Medicare Part B increase in 2010. That's because there is a "hold harmless" provision of Social Security that prevents Social Security payments from decreasing from one year to the next as a result of Medicare Part B increases. The intention of that provision was to protect seniors on a fixed-income from losing income if the premium for Part B increases.

Well, for the first time in 35 years, Social Security payments are not going up, because there will be no cost of living increase. That means Medicare Part B premiums can't go up either, but only if you've already been collecting Social Security and have Medicare Part B taken out of your Social Security check.

Baby Boomers who won't reach full retirement until age 66 and who waited to start Social Security at that age to get a higher payout may be sorry they waited. Also, high-income seniors -- with incomes greater than $85,000 for individuals and $170,000 for couples -- will pay more as well. Both groups will bear the brunt of the Medicare Part B increase.

Continue reading Baby Boomers and high-income seniors bear burden of Medicare increase

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