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December 6, 2012
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Financial and wealth management news for the retirement community

  Top News 
  • Fiscal fixes might hurt retirement industry, experts say
    Several proposed solutions to the country's fiscal woes include measures that would end the favorable tax treatment of 401(k) and similar retirement plans. That could take a disastrous toll on America's retirement industry and on Americans' ability to plan for their future, some experts say. "Destabilizing the employer-sponsored retirement system could have serious unintended consequences for the future," warns Lynn Dudley of the American Benefits Council. Financial Advisor online (12/5) LinkedInFacebookTwitterEmail this Story
  • Adviser: Proposals could cut 401(k) contributions by 65%: Limits on tax expenditures being discussed as a possible way to avert the "fiscal cliff" could end up driving down contributions to 401(k) retirement plans by as much as 65%, says Brett Goldstein of American Investment Planners. One proposal being talked about would cap employee 401(k) contributions to the lesser of $20,000 a year or 20% of pay. AdvisorOne (12/4) LinkedInFacebookTwitterEmail this Story
  Industry Update 
  • Fall from "fiscal cliff" could encourage 401(k) deferrals
    If lawmakers and the White House don't reach a solution to avoid the higher tax rates that would come with the "fiscal cliff," retirement plans could suddenly appear more attractive to investors faced with higher tax rates, experts say. "Higher taxes are good for the retirement business. They make retirement plans more attractive," said Brian Donohue of October Three. BenefitsPro.com (12/5) LinkedInFacebookTwitterEmail this Story
  • Commentary: "One portfolio" option attracts 401(k) participants
    Investors who are overwhelmed with the investment choices presented by their 401(k) plans increasingly are choosing the default "one portfolio" option, Christopher Carosa writes. The approach limits the amount of due diligence required of plan sponsors, although it can complicate their efforts to identify "one portfolio" offerings, he writes. BenefitsPro.com (12/5) LinkedInFacebookTwitterEmail this Story
  • Study: Public pensions steer clear of 401(k) switch
    Most states have taken steps to reduce their public-pension liabilities, but none has altogether switched to a 401(k)-type plan, a study from the National Institute on Retirement Security found. One main reason appears to be cost: It costs more to provide the same retiree benefits through a defined-contribution plan than through a pension, the study says. Reuters (12/5) LinkedInFacebookTwitterEmail this Story
  Financial Literacy 
  • Commentary: For the young, low-risk investments are a risky choice
    Young investors have time on their side, so they shouldn't load up on the conservative investment choices that their parents choose, Jeff Reeves writes. Reeves cites anecdotal evidence that young investors invest too heavily in bonds, and notes that this strategy could leave young investors without enough cash when they reach retirement age. The Huffington Post (12/5) LinkedInFacebookTwitterEmail this Story
  • Other News
  On the Economy 
  • Geithner is "absolutely" prepared to go over "fiscal cliff"
      
    Source: CNBC
    If Republicans won't go along with higher tax rates for America's wealthiest 2%, the Obama administration is ready to let the "fiscal cliff" automatically take effect at year-end, Treasury Secretary Timothy Geithner said. "There's very broad support out there for not just extending these tax cuts for 98% of Americans, but for an agreement that has rates going up with tax reforms that limit deductions alongside a set of substantial long-term savings on the spending side," he said. CNBC (12/5) LinkedInFacebookTwitterEmail this Story

  Building Your Practice 
  • Succession planning for advisers who want to keep working
    Many financial planners intend to stay actively involved in their practice for as long as possible, either because of financial necessity or simply because they enjoy the work, Michael Kitces writes. Nonetheless, succession planning remains a necessity, Kitces writes. Among the long-term options to consider are selling the practice while remaining there indefinitely to service clients, and instituting a sales agreement that will become effective upon death or disability, he writes. Nerd's Eye View blog (12/3) LinkedInFacebookTwitterEmail this Story
  SmartQuote 
Why always 'not yet'? Do flowers in spring say 'not yet'?"
--Norman Douglas,
British writer


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