Financial Adviser Exposes Own Portfolio

People are often surprised when I describe my personal portfolio to them. Using an analyzing tool from Chicago-based Morningstar, I’ve put together a brief description of my own daringly dull portfolio and, far more important, why it looks like it does. Most of my investments are in mutual funds with an average expense ratio of 0.16 percent annually. I don’t have enough money to diversify by buying individual stocks, so I buy low-cost index funds that track the overall market. …

10 Financial Tips for the Kids

We all want our children to be successful and happy. And though being financially fit won’t make anyone happy in and of itself, it can at least take away money stresses and allow the kids to pursue happiness. Just in time for Financial Literacy Month, three journalists from the Wall Street Journal offer 10 great tips in the video below. Get the latest tips on protecting your money and saving for retirement — AARP Money newsletter » Here are the 10 …

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 …

Obama Budget Would Drastically Alter IRA Rules

President Barack Obama calls them loopholes, although investors consider them playing by the rules. Yet under the president’s newly released budget, some of the tax strategies used by high-income earners to contribute to Roth IRAs or maximize the tax benefits on inherited IRAs would go away. Right now, to make a full or partial contribution to a tax-friendly Roth IRA, income must be under $131,000 for an individual and $193,000 for a married couple. High earners have gotten around this by …

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 …