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Melissa Phipps

Melissa's Retirement Planning Blog


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Battle of the Retirement Plans

Friday May 30, 2014

Defined contribution plans, defined benefit plans... what's the difference? Both are retirement savings vehicles that you get through your employer. But one offers a guaranteed income stream and the other has greater potential for growth. Which is which? And which should you choose? Find out who wins in the battle of defined contribution vs. defined benefit plans.

The Vest and the Rest

Friday May 30, 2014

What does it mean to be vested? It means that you have worked at a company long enough to accrue the full benefits offered by your employer. Matching contributions to your 401(k) can follow a vesting schedule, as can pension benefits and employee stock options.

So are you vested? If you don't know the answer,  you should find out. The answer could have a big impact on your retirement savings.

In Search of the Elusive Pension Plan

Friday May 30, 2014

If there's one thing everyone seems to know about retirement planning, it's that the pension plan our parents or grandparents had doesn't exist anymore. That's not exactly true. The pensions wherein your company continues to pay you regularly in retirement, known as defined benefit plans, do still exist. There are, however, far fewer of them around than there were just 15 years ago. In 1998, 90% of Fortune 500 companies offered a defined benefit pension to new employees. By 2012, that number dropped to 30%. Pension plans may be on the endangered financial species list, but they are not yet extinct. If you have one (or still hope to), you should know how pension plans work.

Tips for Revolving Door Retirees

Thursday May 29, 2014

I have a new favorite term: the revolving door retirement. It's such a great way to describe the trend of retirees returning to work to meet expenses (or just to have something interesting to do).

If you are considering going through that revolving door in retirement, there are a few things to consider. There are taxes, commuting and lunch costs, and the impact on Social Security and Medicare. Here's what to think about before you think about going back to work after you've retired.

Feeling Anxious?

Thursday May 29, 2014

We all have our share of money worries. It's how you deal with financial anxiety that makes a difference to your overall well-being. I've invited Rebecca Levin, assistant editor at Anxiety.org, to share some techniques to help chase away those dark thoughts about financial problems (or anything else). Here are 4 ways to ease your financial anxiety.

Barbara Walters Retires... Sort of

Monday May 19, 2014

Last week, the big retirement news centered around Barbara Walters, who taped her last episode of the TV show, "The View." It's more of a semi retirement, since Walters says she will continue to be involved behind the scenes at the show. But it was a big enough move to motivate several generations of women in journalism to come out and celebrate Walters in what is undoubtedly one of the best retirement parties ever held.

The semi retirement is a growing trend among adults who want to lighten their workloads but not necessarily stop working altogether. Last year, HSBC and the Cicero Group conducted a survey in which more than one-third of respondents said they were interested in a semi retirement transition out of the workforce. A full 19% of respondents from age 55 to 65 say they are already semi retired. Semi retirement is a great way to stay engaged and active in your retirement years, and it certainly helps to boost your income in retirement. Not likely an issue for Barbara. For her, it's probably difficult to let go of the great interview that hasn't yet happened. But hey, the fear of missing out on the unknown can drive the rest of us, too.

How Rubio Would Deal With Retirement

Monday May 19, 2014

This week, Republican Senator Marco Rubio presented his ideas for changing the US retirement system. His proposal includes opening the federal retirement savings program, the Thrift Savings Plan, to all Americans. The TSP plan comes with a 5% government matching program, kind of like an employer match. Whether or not such a plan would be possible (the administration alone seems beyond our current abilities) remains in question. But it's good to see potential presidential candidates bringing the subject of sustainable retirement to the national debate.

Rubio's plan would also include an increased retirement age, waiving payroll taxes for individuals in retirement, putting a limit on Social Security benefits to wealthy recipients, and opening up the Medicare system to let people choose between private insurance plans (similar to Medicare Supplement, Part D or Medicare Advantage plans) and traditional Medicare.

What do you think of these proposals? I say, let's continue the debate.

Looking for Safety?

Wednesday April 30, 2014

Do I have a book for you. The Safe Investor: How to Make Your Money Grow in a Volatile Global Economy, by Timothy F. McCarthy, is not only an interesting and informative investment guide, it's also a really good read. Take a look at my review of the book, The Safe Investor.

Hardship Distributions

Wednesday April 30, 2014

If you pull money out of your qualified retirement plan before retirement age of 59 1/2, you will owe taxes and penalties. But there are circumstances under which you can do it penalty-free. These are called hardship distributions, and if you can plead your case, you may be able to save some money.

Exhausting the Topic of 401(k) Loans

Wednesday April 30, 2014

Because I want you all to understand 401(k) loans, inside and out, I have written several articles on the topic. How to borrow from your 401(k) offers a big picture view, and frequently asked questions about 401(k) loans will help you understand some of the details of the deal.

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