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Firms Plan to Eliminate Retiree Health Plans
Tweet Share on Facebook May 28, 2010 Comment (2)Employers are increasingly trying to avoid paying for health insurance for retirees who leave the workforce before they become eligible for Medicare. Some 43 percent of companies currently offering retiree medical benefits plan to soon reduce or eliminate them, according to a recent Towers Watson survey of mid and senior level benefit professionals at 392 companies providing health plans to retirees.
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$250 Medicare Part D Rebate Checks to Begin
Tweet Share on Facebook May 28, 2010 Comment (14)Seniors who have high prescription drug costs will soon receive government payments. The first $250 rebate checks for retirees who have reached the Medicare Part D coverage gap will be mailed out on June 10, 5 days ahead of schedule, Health and Human Services Secretary Kathleen Sebelius announced yesterday. The one-time payments, created by a provision of the health reform bill, will continue to be sent out monthly as more seniors fall into the coverage gap.
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Investors Moving Money to Low Cost Funds
Tweet Share on Facebook May 27, 2010 CommentLower fund costs allow investors to keep more of a fund’s return. The volatile financial market has led to increasing concern about how much investment expenses erode gains and enhance losses, especially when saving for a long-term goal such as retirement. Costs are also sometimes controllable by shopping around for funds that charge the lowest expenses.
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More New Employees Shut Out of Pensions
Tweet Share on Facebook May 26, 2010 CommentMost new hires at top U.S. companies will not be invited to join the pension plan this year. Only 17 companies in the Fortune 100 currently offer traditional pensions to new hires, down from 20 in 2009 and 67 in 1998, according to a new Towers Watson analysis. Another 25 companies offer hybrid pension plans, such as cash balance plans.
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Lower Social Security Checks for 1947-Born Retirees
Tweet Share on Facebook May 25, 2010 Comment (2)Individuals born in 1947 will get lower Social Security benefits than older and younger retirees. Those age 62 in 2009 will receive checks 2.6 percent below payments made to retirees born between 1930 and 1946, according to Center for Retirement Research at Boston College calculations released today. For a 1947-born retired couple receiving $2,347 monthly, this benefit decrease costs them $749 per year. If they both live until age 83, the couple will lose $12,729 over their lifetime.
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More Pension Plans Frozen
Tweet Share on Facebook May 24, 2010 CommentIf you’re still in the fortunate minority of workers with access to a traditional pension, these valuable retirement benefits may not continue until you retire. Companies are increasingly closing pension plans to new hires and even freezing new accruals for existing employees.
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IRS: 401(k) Participants May Sell Company Stock
Tweet Share on Facebook May 21, 2010 CommentSome companies match employee 401(k) contributions or pay bonuses in company stock. But, as all former Enron employees know, holding too much company stock can be risky. A new Internal Revenue Service ruling this week says 401(k) participants with at least 3 years of service must be permitted to sell company stock and reinvest the assets once every three months.
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401(k) Recovery Winners and Losers
Tweet Share on Facebook May 20, 2010 Comment (4)401(k) account balances have rebounded significantly since last year. Fidelity 401(k) accounts held an average of $66,900 at the end of first quarter of 2010, up 41 percent from a year earlier. That amount, however, is still below the $69,200 nest egg Fidelity 401(k) participants had in 2007.
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Retiree Prescription Drug Prices Soar
Tweet Share on Facebook May 19, 2010 Comment (1)The price of the brand name prescription drugs most widely used by Medicare beneficiaries increased 9.7 percent in the 12 months ending in March 2010, according to a new AARP Public Policy Institute report. This is the highest spike in retiree drug prices observed since AARP began tracking drug prices in 2002. The average annual cost for a single brand name medication was about $2,190 and individuals using three brand name prescriptions paid $6,580. The majority of the 219 brand name drugs in the study (88 percent) increased in price between April 2009 and March 2010.
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12 Ways to Fix Social Security
Tweet Share on Facebook May 18, 2010 Comment (458)The Social Security program faces a long term financing shortfall. The trust fund’s reserves are currently projected to cover payments until the end of 2037. Then there will only be sufficient resources to pay about three quarters of scheduled benefits. For full checks to be issued after that date the program’s financing or benefit structure must be modified.
