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Why IRAs Hold More Money Than 401(k)s
Tweet Share on Facebook March 12, 2013 CommentWorkers can contribute up to $17,500 to a 401(k) in 2013, which jumps to $23,000 if you are age 50 or older. That’s over three times more than the $5,500 (or $6,500 at age 50 or older) that workers can contribute to IRAs. And yet workers have much more money invested in IRAs. Investors collectively held $4.87 trillion in IRA accounts in 2011, compared to $3.88 trillion in private-sector defined contribution plans like 401(k)s, according to Federal Reserve data. Here’s a look at why IRAs collectively hold more cash than 401(k) plans:
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10 Things to Do in Retirement
Tweet Share on Facebook March 1, 2013 CommentSaving enough money to pay for retirement is important, but it’s not the only thing you need to do to prepare. When you no longer go to work each day, you will have hours of free time you need to fill. While relaxation might be enough for the first few weeks of retirement, many workers want something productive or exciting to fill their retirement years. A recent HSBC survey asked current employees what they aspire to do in retirement. Here are the activities U.S. workers have planned for their retirement years:
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5 Ways to Fix Social Security
Tweet Share on Facebook February 13, 2013 CommentThe Social Security trust fund is expected to be exhausted in 2033. After that, there will be enough tax revenue coming in to pay out about three quarters of promised benefits. However, a few changes to the system could prevent these steep benefit cuts. Here are five potential Social Security changes, and how much of the budget shortfall they would address:
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4 Great Reasons to Save Your Tax Refund
Tweet Share on Facebook February 5, 2013 CommentYour tax refund is likely to be one of the biggest paydays you will get this year. There are many benefits to saving at least part of your refund, and sometimes you can get additional perks if you save in specific ways. Here are some great reasons to save your tax refund:
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IRA Tax-Free Charitable Contributions Extended
Tweet Share on Facebook January 25, 2013 CommentIRA investors who wish to donate some of their retirement savings to a charity are now eligible to make tax-free transfers that will count toward tax year 2012, if they act quickly. Individuals age 70 ½ or older have until January 31, 2013 to make a direct transfer to an eligible charity. And people who received IRA distributions in December 2012 may contribute part or all of the amount received to a charitable institution tax-free.
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How Entitlements Influence When People Retire
Tweet Share on Facebook January 17, 2013 CommentWorkers have a variety of strategies for deciding when they will retire. Eligibility for various forms of retirement benefits, especially Medicare and Social Security, often plays a key role in the decision-making process. Here is how workers are determining the best age for retirement:
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Retirement Tax Deadlines for 2012
Tweet Share on Facebook December 21, 2012 CommentIn order to get tax breaks for saving for retirement in a 401(k) or IRA, you need to meet certain deadlines. Retirees also need to pay attention to specific dates to avoid tax penalties. Here are some important dates to keep in mind for tax year 2012:
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How to Claim the Retirement Saver’s Tax Credit
Tweet Share on Facebook December 14, 2012 CommentLow- and moderate-income workers who save for retirement in 401(k)s and IRAs are eligible to claim the saver’s credit, a tax credit worth up to $1,000 for individuals and $2,000 for married couples. Workers can claim this credit in addition to the tax deduction they also get for their retirement account contributions.
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How Much You Will Get if Your Pension Fails
Tweet Share on Facebook December 7, 2012 CommentIf your company pension plan fails, you won’t necessarily end up without any retirement income. Most traditional pension plans, but not 401(k)s, are insured by the Pension Benefit Guaranty Corporation up to certain annual limits. The maximum annual guarantee for a 65-year-old retiree whose pension plan ends in 2013 will be $57,477.24, up from $55,840.92 in 2012.
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Average 401(k) Balance Reaches New High
Tweet Share on Facebook November 9, 2012 CommentThe average 401(k) balance reached $75,900 at the end of the third quarter on September 30, 2012, up 18 percent from $64,300 a year ago. This is the highest average 401(k) balance Fidelity Investments has recorded since it began tracking this number more than 12 years ago.
