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Tag: 401k

If you received a 401(k) plan refund check, here’s what to do

If you received a 401(k) plan refund check, here’s what to do

Finance
If you contributed to a 401(k) plan at work and received a refund for a portion of your contributions, then chances are your plan failed Internal Revenue Service compliance testing.IRS guidelines require 401(k) plans to meet certain criteria known as "annual contribution percentage" and "annual deferral percentage" to determine the amount participants are able to contribute.The reason a person receives a 401(k) refund check is most likely that the employer's plan has failed one or both of these tests, which prevents the employee from contributing above a certain amount. And that occurs when eligible participants in the company's 401(k) plan are not contributing enough of their income, and employers are not contributing a significant enough amount on the employees' behalf, either.The reason...
So you are a 401(k) plan ‘millionairess.’ Now what?

So you are a 401(k) plan ‘millionairess.’ Now what?

Finance
I recently read an article in The New York Times that detailed how, over the past 12 years, the number of women who have achieved "millionairess" status has doubled.Also, based on a recent Fidelity report that surveyed 15 million 401(k) plan participants, 20 percent of respondents with $ 1 million or more in retirement accounts are women. They invested wisely in stocks, saved more than 18 percent of their salaries and developed a consistent habit of contributing to their 401(k) plans. Many earn less than $ 150,000 annually, which makes the ability to reach this benchmark even more impressive.Achieving this goal doesn't change who you are, but it can change how you plan for your future. You worked hard and saved more, and now you have options. I've consulted with clients who have achieved t...
By cutting 401(k) contribution limit, Congressional Scrooges want you to work longer, take more risk

By cutting 401(k) contribution limit, Congressional Scrooges want you to work longer, take more risk

Finance
The holiday season is fast approaching. It is a time most people feel more generous to loved ones or to the less fortunate. Not so when it comes to Congress.If lawmakers have their way, taxpayers may have to work longer in their lives, work more hours or have to take more risk in the investment markets to live the retirement they envision now.This is what reducing the 401(k) plan contribution limit could mean. This is what Congress is calling "tax reform."There are 54 million American workers participating in about 550,000 401(k) plans, according to the Investment Company Institute. These plans hold more than $ 5 trillion in assets. This tax reform measure will most likely affect the wealth of most American households and certainly affect the way they save for retirement.A person can make ...
Top House tax writer suggests 401(k) changes could still happen, contradicting Trump

Top House tax writer suggests 401(k) changes could still happen, contradicting Trump

Finance
The top House tax writer on Wednesday signaled that Congress could still propose changes to a popular retirement savings plan in its tax bill, contradicting an assurance made by President Donald Trump. At a Christian Science Monitor event, Rep. Kevin Brady said Republicans are "exploring a number of ideas" to "create incentives for Americans to save more and save sooner." The House is "continuing discussions with the president" in that area, the House Ways and Means Committee chairman said. "I do have a worry. Not enough Americans are saving," Brady said at a separate Yahoo Finance conference later in the day. Brady said Republicans have "asked for ideas how Americans (can) save more and save earlier in their lives." On Monday, Trump emphatically tweeted that "there will be NO change to yo...
401(k) contribution limit will rise to $18,500 next year

401(k) contribution limit will rise to $18,500 next year

Finance
Planning young: a retirement roadmapYou'll be allowed to contribute an extra $ 500 to your 401(k) next year. The government will raise the contribution limit to $ 18,500 from $ 18,000 in 2018. It reassesses the limit annually. A 401(k) is a good way to save for retirement because your money grows tax-free. But there's a limit on how much you can save each year and when you can withdraw the funds. If your employer doesn't offer a 401(k), you can contribute to an IRA or Roth IRA to save for retirement. They have tax advantages and contribution limits, too. There's also a restriction on who can use a Roth IRA based on income. The limit on how much you can contribute to your IRA or Roth IRA will remain unchanged at $ 5,500 next year. But the income eligibility for a Roth IRA will rise. Here...