Large Defined Benefit Plans Produce Better Returns Than Comparable 401 k Plans: related news

Large Defined Benefit Plans Produce Better Returns Than Comparable 401(k) Plans

From Spencer's Benefits Reports: Companies that sponsor both large defined benefit plans and 401(k) plans see better investment returns from their defined benefit plans, according to Watson Wyatt. This generally is true because larger plans have access to a wider variety of investment options and economies of scale. As reported in a recent Insider newsletter, Watson Wyatt used 5500 form data to calculate the median rate of return for plan sponsors that sponsored both a defined benefit plan and a 401(k) plan, each with at least 100 participants.

Roth Feature Boosts Benefits For 401(k) And 403(b) Plans

Roth 401(k) and 403(b) plans, available since January of 2006, offer substantial benefits for employees who are looking for ways to shelter income from taxes on a permanent basis. However, it can be difficult for employees to know whether they will come out ahead by selecting the Roth option in their plans instead of the traditional pretax contribution features. Let's take a look at some of the benefits of the Roth feature and compare them to traditional retirement plans. (For background reading, see Introducing The Roth 401(k).)

What Small Business Owners Need to Know About 401(k)s

Running a small business can be a life-consuming process, so sometimes small-business owners miss the forest for the trees. Maybe that's why only about 16 percent of businesses with fewer than 50 employees in the United States have 401(k) plans. Small-business owners are so focused on developing their businesses that some do not realize that those assets can grow at a much faster rate for their retirement under the right plan. An October survey by ING DIRECT's ShareBuilder401k, which designs 401(k) plans for small businesses, found that "not enough employees" was the top reason cited by small-business owners as to why they do not have a 401(k) plan. That's despite the fact that even sole proprietorships with no other employees can have 401(k)s.

Next Generation of 401(k)s Shows Automatic Enrollment and Step-Up Provisions Doubling Among Employers: Deloitte Survey

PRNewswire/ -- Employers are taking decisive actions to make 401(k) plan participation as easy as possible for employees, according to the 2008 401(k) Benchmarking Survey, conducted by Deloitte, the International Foundation of Employee Benefit Plans and the International Society of Certified Employee Benefit Specialists (ISCEBS). Survey respondents addressed such topics as eligibility and enrollment, contributions, matching formulas, investment funds, revenue sharing, defined benefit plans, fees, vendors, plan effectiveness, communications and administration.

10 ways to spot 401(k) abuse

More Americans than ever rely on 401(k) plans to save for retirement. And to say the plans are increasingly popular is an understatement. Assets in 401(k) plans surpassed $3 trillion at the end of 2007, according to the Investment Company Institute, a national association of U.S. investment companies.

New Research from EBRI: 401(k) Participant Experience May Hold Lessons for Consumer Engagement in Health Plans

WASHINGTON, Aug 12, 2008 /PRNewswire-USNewswire via COMTEX/ -- The development of 401(k) plans over the last quarter century, and the recent legislation to overcome worker inertia with default enrollment, diversification and contributions, may offer lessons that can be applied to the design of "consumer-driven" health benefit plans, especially since both depend upon the need for individuals to become good decision makers, according to a study published today by the nonpartisan Employee Benefit Research Institute (EBRI).

Traditional Pensions Outperform 401(k)'s

During the bull market of the late 1990s, 401(k) plans outperformed traditional pension plans. But this decade has brought a reversal of fortune: During both the 2002 bear market and the 2003-2006 bull market, traditional pension plans outpaced 401(k)'s, according to an analysis by consulting firm Watson Wyatt Worldwide.

Worksheet: The Roth 401(k) Estimator

This relatively new retirement savings option, which first became available on January 1, 2006, combines features of both a traditional 401(k) plan and a Roth IRA. Like a Roth IRA, contributions are made on a post-tax basis and qualified withdrawals taken during retirement are completely tax free. (With a traditional 401(k), contributions are pretax and withdrawals taken during retirement are taxed as ordinary income.) And like a traditional 401(k), the Roth 401(k) has no income restrictions — if your employer offers it, you're eligible. (For more details, read our story, "Introducing the Roth 401(k).")

Study: 401(k)s and other defined contribution plans growing rapidly, offering more options

CHICAGO (AP) - Once just a supplement to the pension system, defined-contribution plans such as 401(k)s are growing and changing fast as they evolve into a linchpin of Americans' retirement savings and offer increasingly innovative investment options, a new study indicates.

ETFs In 401(k) Plans

A June survey conducted by State Street Global Advisors and Knowledge@Wharton determined that financial advisors think the biggest potential growth area for the exchange-traded fund industry is in 401(k) plans. Of the survey's 840 respondents, 43% said that 401(k)s would be the biggest area of growth for the ETF industry going forward, compared with 27% for actively managed ETFs and 20% for unified managed accounts.

Workers contribute to 401(k) plans despite volatility: study

BOSTON (MarketWatch) -- Mutual-fund giant Fidelity Investments on Wednesday said despite a weak economy and volatile markets, a study showed workers boosted their average contribution to their corporate defined-contribution plans in the first half of 2008 compared with the same period last year. The company cited an analysis of its 16,723 corporate defined-contribution plans representing 11.5 million participants. "There is no doubt that American workers are feeling the pressure from escalating energy and food prices as well as a slumping real estate market, but the majority are making retirement a priority and staying the course," said Scott David, president of retirement services at Fidelity Investments, in a press release. End of Story

ETFs Make Little Headway into 401(k) Plans

A June survey conducted by State Street Global Advisors and Knowledge@Wharton determined that financial advisors think the biggest potential growth area for the exchange-traded fund industry is in 401(k) plans. Of the survey's 840 respondents, 43% said that 401(k)s would be the biggest area of growth for the ETF industry going forward, compared with 27% for actively managed ETFs and 20% for unified managed accounts.

More Senior Executives Taking a Role in Managing Employee 401(k) Plans

PITTSBURGH – Significantly more senior executives are taking a direct role in decisions regarding their organization’s 401(k) plans than in the past, according to Cowden Associates, Inc.’s Second Annual Tri-State Defined Contribution Plan Sponsor Survey.

Sometimes It Pays To Borrow From Your 401(k)

The financial media has coined a few pejorative phrases to describe the pitfalls of borrowing money from a 401(k). Some members of the financial press would even have you believe that taking a loan from a 401(k) plan is an act of robbery committed against your own retirement. However, this idea may be more urban myth than reality. According to a study by the Employee Benefits Research Institute (EBRI), 18% of all 401(k) participants had plan loans outstanding in 2006. Clearly, these loans have a following and, in fact, they can be appropriate in some situations. Let's take a look at how such a loan could be used sensibly and why it need not spell trouble for your retirement savings (For related reading, see Eight Reasons To Never Borrow From Your 401(k).

Rogers Announces iPhone Plans in Canada

Rogers announced service plans for the iPhone 3G in Canada today. iPhone 3G combined voice and data plans start at $60 and will be available starting July 11th. "As the wireless provider voted number one in wireless satisfaction(x), Fido is thrilled to offer a variety of well-priced voice and data plans making iPhone 3G accessible to as many of our customers as possible," said Sylvain Roy, Senior Vice President and General Manager, Fido. "These pricing plans will allow our urban customer base easy enjoyment of all that iPhone 3G has to offer."

What Should You Do With Your Old 401(k)?

(EMAILWIRE.COM, June 26, 2008 ) (EMAILWIRE.COM, Cincinnati, OH -- If you have changed jobs several times during the course of your career, you probably have an interesting collection of retirement savings accounts from your previous employers. In fact, according to the Department of Labor, Americans move to a new employer once every four years and our collective trail of old 401(k) and 403(b) plans totals in the trillions of dollars. While leaving your retirement account with a former employer is a better decision than cashing out your account and splurging on a boat, it may be more beneficial to consolidate your retirement savings by rolling your old 401(k) or similar employer-sponsored retirement plan into an IRA. A Rollover IRA offers you four major benefits: • Increased Investment Options.

Big plans, new horizons for Best Buy: The giant consumer electronics retailer has plans to push into new markets in Mexico, Europe and Turkey.

Big plans, new horizons for Best Buy: The giant consumer electronics retailer has plans to push into new markets in Mexico, Europe and Turkey.

401(k)s To Get More Cost Effective

It looks like 401(k) sponsors and participants are finally coming into the home stretch in the race to obtain clearer fee disclosure. The House Education and Labor Committee chaired by George Miller (D-Calif.) has been pushing passage of the 401(k) Fair Disclosure for Retirement Security Act, which differs somewhat from an earlier bill that was sharply criticized by the mutual fund industry -- largely because it required that all plans include an index fund, a less expensive investment option than most other fund offerings.

401(K) LOANS AND WITHDRAWALS

Thirty-six percent of U.S. workers had a defined contribution retirement plan, which includes 401(k) accounts, according to the 2004 Survey of Consumer Finances conducted for the Federal Reserve Board. Of 401(k) plans among clients of Hewitt Associates L.L.C.:

Rethinking 401(k) rollovers to IRAs

Conventional retirement wisdom tells us that when you leave a job, you should roll over your 401(k) to an IRA. Rollovers allow you to continue delaying taxes on your nest egg as it accumulates and avoid an early-withdrawal penalty. But if you have an especially good 401(k) with your old company, it may be better to leave your retirement money there or roll it over into your new company's 401(k).

Rethinking 401(k) Rollovers

Conventional retirement wisdom tells us that when you leave a job, you should roll over your 401(k) to an IRA. Rollovers allow you to continue delaying taxes on your nest egg as it accumulates and avoid an early-withdrawal penalty. But if you have an especially good 401(k) with your old company, it may be better to leave your retirement money there or roll it over into your new company's 401(k).

Probity Advisors and Wealth Services Alliance Target CPAs and 401(k) Plans with Innovative SMA-Based Investment Solutions

Probity Advisors and Wealth Services Alliance Target CPAs and 401(k) Plans with Innovative SMA-Based Investment Solutions

Probity Advisors and Wealth Services Alliance Target CPAs and 401(k) Plans with Innovative SMA-Based Investment Solutions

Probity Advisors and Wealth Services Alliance Target CPAs and 401(k) Plans with Innovative SMA-Based Investment Solutions

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