Retirement Planning
IRS Benefit and Contribution Limits for Retirement Plans
Considering the country’s current budget deficit crisis and given such factors as the formation of a so-called “Super Committee” charged with identifying reductions over the next ten years, it is inevitable that the tax deductibility of contributions to qualified retirement plans will come under the scrutiny of legislators. One such proposal recently considered by the Joint Select Committee on Deficit Reduction was known as the “20-20 proposal” and would have limited Annual employer and employee retirement plan contributions to 20 percent of compensation or $20,000 whichever is lower. Read more »
The Great Recession’s Impact on Retirement
After the Stock Market Crash of 1929, John D. Rockefeller said, “These are days when many are discouraged. In the 93 years of my life, depressions have come and gone. Prosperity has always returned and will again.” In many ways the Great Recession from 2007 to 2009 was the worst economic downturn since the Great Depression. In addition to all the financial hardships experienced by millions of working families, economic security for future retirees could also be eroded. Read more »
Borrowing Money from Your 401(k) Plan
If you have a 401(k) plan, you might be tempted to borrow money from it. Keep in mind that the purpose of a 401(k) is to save for retirement. Take money out now, and you’ll risk running out of money during retirement. Still, if you’re facing a financial emergency, borrowing money from your 401(k) may be an option. Read more »
2011 Payroll Tax Holiday—Stimulus for Your 401(k)
A recent law change reduced each individual’s FICA contribution from 6.2% to 4.2% of wages for 2011 thereby providing each individual with 2% more in their paycheck throughout the year. Should you already have a 401(k), the payroll tax holiday represents an opportunity to increase your retirement nest egg by increasing your 401(k) contribution rate in 2011.
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Retirement Plan Participant Level Fee Disclosure
The Department of Labor (DOL) recently published final regulation on participant’s fee disclosure, dramatically impacting retirement plan administration. The regulation becomes effective (the deadline by which plan administrators must be in compliance) for plan years beginning on or after November 1, 2011. This means by January 1, 2012 for calendar year plans. As a result, retirement plan service providers will be busy preparing to meet the new disclosure requirements. Read more »