News Now

Consumer
New initiatives aim to boost retirement savings
NEW YORK (9/14/09)--New initiatives announced this month by President Obama and Treasury Secretary Timothy Geithner will make saving for retirement a lot easier and more automatic, particularly for the estimated 78 million working Americans--approximately half the workforce--who don’t have a retirement savings plan at work (The New York Times Sept. 6). A White House document released Sept. 5 outlines four steps, effective immediately, to expand the range of retirement savings options for workers:
* Streamline automatic enrollment. Behavioral research indicates that workers are more likely to contribute to a retirement plan if they’re automatically enrolled. Although many large- and medium-size companies already have adopted automatic enrollment, the new initiatives target very small firms that often use a simpler system called the “simple I.R.A.” Watch for new guidelines from the Labor Department on how small businesses can use automatic enrollment, and how to institute an automatic “step up” to increase the worker’s savings rate each year or with each pay raise. Workers can opt out of automatic enrollment or stop the increases at any time. * Redirect tax refunds. Beginning in early 2010, taxpayers can check a box on their tax return and use their refund to purchase U.S. savings bonds, which will be mailed to the taxpayer. Beginning in 2011, taxpayers can add co-owners, such as children or grandchildren, to the bonds purchased with tax refunds. * Convert unused vacation or leave. Rather than receive cash for unused vacation and similar leave when leaving a job, employers can allow employees to contribute those amounts to their 401(k) plan. * Use plain language. To help workers understand the confusing rules governing retirement plans when changing jobs, the Treasury Department and the Internal Revenue Service are publishing an easy-to-read, plain-English guide. This road map explains how to transfer plan balances, what key decisions need to be made, and what the tax consequences are for each decision. Look for new user-friendly website materials, too, at irs.gov/retirement.
For more information, read “HR an Essential Member of Your Retirement Planning Team” in Plan It: Retire Ready Toolkit.
Other Resources

RSS





print
News Now LiveWire
.@PayPal co-founder launches payment-plan lending for online purchases via @CNBC http://t.co/c1FnZHaQya
3 minutes ago
Skimming remains biggest security threat for ATMs says @ATM_Industry global survey #NewsNow http://t.co/VIcX8yGqmY
27 minutes ago
Media outlets widely share @CUNA-CFA #holiday spending outlook #NewsNow http://t.co/9gBFwdfBKv
31 minutes ago
National #LouiseHerring awards for #creditunion philosophy in action selected #NewsNow http://t.co/two4z5lBAU
1 hours ago
#NewsNow: @CUNA-CFA survey results suggest 3-3.5% increase in holiday spending. http://t.co/GjcDvvwfzy
18 hours ago
150x172_Sign up for election newsUnite for Good Share your Stories100 Million CU Memberships