Cashing Out Your 401(k) and Living Dangerously

We all know that 401(k) savings plans are designed to help us sock away money for our old age. Increasingly, workers are tapping those funds for loans or cashing out altogether. Two reports released this month suggest that our retirement security could be undermined by our pattern of using those savings to ease our financial stress today. An estimated $6 billion annually seeps out of U.S. 401(k) plans because loans taken against them were not repaid fully, according to a …

How Much Income Will Your 401(k) Provide?

You may be throwing money into your employer-sponsored retirement plan – let’s hope you are – but do you know how much estimated monthly income your plan will provide over your lifetime? Employers are required by law to provide an outline of what workers can expect to get in estimated monthly retirement income from their traditional pension plans. But that’s not the case for 401(k) and 403(b) plans. [Find out if you’re saving enough for retirement with AARP’s calculator]. Maybe …

Changing Jobs? Beware of Bad Information About 401(k) Options

About to change jobs? If you have a 401(k) account, you’re at risk of getting bad information when you ask the company managing your retirement plan about your options. Turns out that, in some cases, the people who give advice over the phone push departing workers toward rolling over their 401(k)s into a privately owned individual retirement account (IRA) that the investment company sells. What these plan providers also don’t disclose to workers are the fees associated with that move or other …

Gen X and Y Saving More, Earlier Than Boomer Parents

Call it generational rebellion at its finest: It seems all the gloomy retirement forecasting for boomers has been inspiring their kids to save more. Workers in Gen X and Gen Y are both starting retirement savings earlier and more likely to make automatic contributions than members of the boomer generation, according to a new survey.

The Takeaway: Americans Borrowing–and Not Repaying–Billions from 401(k)s

What’s a worse financial plan than taking a loan from your retirement savings? Taking a loan from your retirement savings and not paying it back. Yet a growing number of Americans are doing just that, according to a new study from financial services firm Navigant Economics. Defaults on 401(k) loans totaled $37 billion in recent years.

Employers Offer Little Help To Workers Sorting Out 401(k) Options

If you give a worker (a cookie and) solid financial benefits, the worker has a much better chance of living comfortably in retirement. And if the worker understands and appreciate those benefits, the happier he or she will be.  And the happier the worker is, the more productive he or she will be. And that will boost the employer’s bottom line. But there was also a darker tale told by the new Bank of America Merrill Lynch report, which examined the views of …