Labor Department Proposes Rule to Save Retirees Billions

Financial advisers would have to adhere to more stringent standards when giving advice on 401(k) plans, IRAs and other retirement accounts under a rule proposed Tuesday by the U.S. Department of Labor. The proposed rule would protect people saving for retirement from being steered into accounts with high fees and commissions that benefit the adviser at the expense of the saver. It would force financial professionals to act in the best interest of their clients — a move that advocates say would …

Why You Should Consider a Roth Conversion

Soon we’ll be looking at tax day in the rearview mirror, which is the perfect time to plan for future tax consequences. One strategy that’s especially good for recent retirees is converting part of a traditional IRA to a Roth IRA. First, a little background. Generally speaking, when you contribute to a traditional IRA, you get a tax break immediately but your money is taxed as ordinary income when you take it out later to live on. A Roth is …

Retiree Health Care Costs May Gobble Up Your Social Security Benefits

A new study projects that a couple retiring this year could spend 67 percent of their lifetime Social Security benefits on out-of-pocket health care costs. And that’s even when couples have Medicare Parts B and D with supplemental insurance. The news gets worse for today’s 55-year-olds who plan to retire in 10 years at age 65, the year in which they’re eligible for Medicare. According to the 2015 Retirement Health Care Cost Data Report, almost 93 percent of that couple’s Social Security …

How to Make Your Financial Dreams a Reality

In his “I Have a Dream” speech, the Rev. Martin Luther King Jr. encouraged us to think about the real possibilities of a brighter future — a future that affords us to live in comfort and prosperity. It is in that spirit that we encourage you to evaluate your dream of financial security. >> AARP’s Financial Freedom Program There are several steps you should consider to help you work toward financial freedom as you kick off the new year with a …

Coalition Urges Labor Department to Protect Retirees’ Nest Eggs

Public interest groups have joined forces in a coalition to prod the U.S. Department of Labor to revise rules requiring financial advisers to act in their clients’ best interests when offering retirement investment advice. SaveOurRetirement.com, a website created by the coalition, is urging the Labor Department to update the so-called fiduciary rule. Without that safeguard, advisers to retirement plans could sell financial products that pay large commissions yet hurt their clients with unnecessary fees, poor returns or excessive risks, the coalition said. “Right now, …

Illinois Is First State With New Savings Plan for Workers

Illinois will become the first state with a broad-based effort to automatically enroll private-sector employees without retirement plans into a new savings program. Gov. Pat Quinn signed legislation on Sunday that creates the Illinois Secure Choice Savings Program. Employers with at least 25 workers and no retirement plan will be required to offer employees the option of enrolling in Secure Choice, which allows employees to invest in a Roth IRA through payroll deduction. Employees can decline. “This turnkey program will make it …