Hertz Schram PC ERISA & Pension Lawyers

A recent issue brief prepared by the Pew Charitable Trusts (Pew) reports that most state pension plans are significantly underfunded and that, for many, the funding gap is growing. [See “The State Pension Funding Gap: 2016. Investment shortfalls, insufficient contributions reduced funded levels for public worker retirement plans (Pew, April 12, 2018)]. Pew, founded in 1948, is an independent non-profit organization that strives to inform the public and improve public policy by providing useful data and analysis to illuminate issues…

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Women face more obstacles than men in achieving a financially secure retirement. That’s the conclusion of a recent report based on an online survey of 6,372 workers conducted by the Harris Poll between August and October 2017 for TransAmerican Retirement Studies. [See “Here and Now: How Women Can Take Control of Their Retirement” by TransAmerica Retirement Studies]. For starters, women earn only 80.5% of the salary of men. They are also more likely to work part-time and to take time…

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There exists a large and troubling gap between retirement expectations and retirement realities, according to the results of a recent online survey conducted by the Harris Poll on behalf of Prudential Insurance. [See “Planning Your Retirement? Expect the Unexpected” by Salene Hitchcock-Gear, Pres. Prudential Advisors] For starters, the average anticipated retirement age of pre-retirees was 65, while the actual retirement age of retirees was age 59–a six-year gap which is expected to widen into the future. Moreover, approximately half (51%)…

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I regularly review commentary, data, and analyses of respected financial advisors concerning retirement savings and investing. While they don’t all agree on everything, there exists a consensus around the most common retirement savings and investment mistakes. Here are the top “dirty dozen” mistakes (as I see them). 1. Holding a Large Portion of Your Savings in Just One or Two Stocks. Even if they are performing well today (or for years), if there occurs a major downturn in the companies’…

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For over fifty years, Palm Beach, California maintained a generous traditional defined benefit (DB) pension plan for its employees that based benefits on a percentage of the employee’s final average pay times years of service. As employees accumulated service and their pay increased over the years, their pension benefits grew exponentially. Upon retirement, the benefit was paid in the form of a life annuity, thereby guaranteeing that participants would never run out of money. During the 1990s, the plan was…

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For the past 20 years, Transamerica Center for Retirement Studies (TCRS) has surveyed U.S. workers about their attitudes towards retirement. TCRS’s most recent survey (Survey), conducted by the Harris Poll between August 9 and October 28, 2017 via an online survey of 6,372 representative workers across the U.S., reveals both similarities and differences in retirement views across three generations: Millennials (born 1979-2000), Generation Xers (born 1965-1978), and Baby Boomers (born 1946-1964). [See “Wishful Thinking or Within Reach? 18th Annual Transamerica…

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If you collect Social Security retirement benefits before age 65, you will automatically be enrolled in Medicare when you turn age 65. However, more and more Americans are delaying the start of their Social Security retirement benefits because the payment becomes increasingly larger the longer one waits (up until age 70). In the course, many Americans are missing critical Medicare enrollment deadlines and, as a result, paying higher Medicare premiums FOR LIFE. In general, you must enroll in Medicare during…

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The Government Accountability Office (GAO)–the audit, evaluation, and investigative arm of Congress–recently released a report showing that a growing number of older Americans are saddled by student loan debt. Indeed, the rate of increase in older borrowers and the amount of their debt has rapidly surpassed that of younger student-loan borrowers. Further, borrowers age 50 and older have much higher rates of default on federal student loans than younger borrowers, loans that generally cannot be discharged in bankruptcy. Worse, under…

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If you are looking for your 401(k) check, this may actually be true. The Pension Benefit Guaranty Corporation, a federal agency, has long had a “missing participant program” which helps find pension plan participants who may have left their employers years earlier and are now owed pension benefits, but cannot be found. The program currently covers only terminated single-employer defined benefit (DB) pension plans (plans that pay benefits based on a formula defined in the plan and in the form…

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Age 50.This is the age at which you become eligible to put more of your wages into your 401(k) and IRA accounts, the so-called “catch-up contributions,” and to receive any matching employer contributions on those catchup amounts. Age 59 ½.With certain limited exceptions, if you take a distribution of your pension before age 59 ½, you will pay a 10% early withdrawal penalty in addition to the income tax otherwise payable on the distribution. If you wait until after age…

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