| Retirement Blues: From Pension Plan to 401k | | | | cashing out on your 401k retirement plan. Terminating |
| Plan-Sound Retirement Investing Advice | | | | a 401k plan would require you to work longer and will |
| We are all still feeling the impact of the financial crisis | | | | cause you to have reduced income when you do |
| from 2008. The pension crisis has been brought to | | | | finally retire. Even if you choose to stop contributing, |
| the attention of Congress. When President Bush was | | | | do not cash out your IRA or 401(k). The second |
| leaving office, one of his final actions was the signing | | | | thing to do is to rebalance your current assets and |
| of an act called the Worker, Retiree, and employer | | | | maybe even think about what's better, a 401k or |
| Recovery Act of 2008. This act was designed to | | | | Roth IRA. Many employers will offer a quarterly or |
| decrease the number of employers who were | | | | semi-quarterly rebalancing program. During this time, |
| reducing the pension benefits offered by the | | | | you can change your investments. If you have one |
| company. The bill included provisions that includes aid | | | | investment that had a high return, you may want to |
| for single-employer pension plans, temporary penalty | | | | invest more money into it for the next quarter. Make |
| suspensions for anyone who was aged 70 1/2 or | | | | sure you do not place all your eggs in one basket. Be |
| older who did not make required distributions from | | | | sure to maintain a balanced portfolio. You don't want |
| their 401k plans or IRA plans and relief for | | | | all of your money ties up in one investment. If that |
| multi-employer plans. The act was a huge relief for | | | | investment plummets, you will lose all of your savings. |
| retirees who were not making distributions. The | | | | The third tip is to remember that saving for |
| original penalty of up to 50% was suspended. | | | | retirement takes time. Keep in mind that when |
| Even though this act did offer some relief, it did not | | | | investing in 401k plans, the more you invest when |
| stop companies from eliminating pension plans that | | | | the market is low, the faster you will recover the |
| were once offered to the employees. Most | | | | losses. |
| employers have made the shift to offer a 401k plan | | | | Even though the current financial situation is |
| instead of a traditional pension package. | | | | disheartening, remember that the market will |
| Unfortunately, the financial crisis hit hard, and it | | | | rebound. It is best to keep contributing if you can |
| affected 401k plans and accounts, decreasing the | | | | afford to do so. When the market does rebound, |
| portfolio value of the plans. This loss in retirement | | | | you will quickly make up for any losses you have |
| savings has been devastating for many individuals. | | | | incurred over the past two years. While it may not |
| They were already battling with the loss of value on | | | | seem a positive thing, this crisis could be the best |
| their homes and losing jobs, and now they are faced | | | | time for anyone under 40 to begin building wealth for |
| with a reduced retirement savings account. The | | | | retirement. Now is the best time to invest. You will |
| combination of all three creates a difficult situation to | | | | reap the benefits hugely when the market rebounds. |
| manage. Despite the major losses, there is additional | | | | But we need to learn from our mistakes and take a |
| relief ahead. There are ways to rebuild your lost | | | | slightly different approach. Take a look at a Roth on |
| retirement savings. | | | | RoidsTM which goes up with the stock market, but |
| Tips to Rescue and Regain Retirement Savings | | | | never goes down with it. |
| The first, and most important, thing to do is avoid | | | | |