What the new 401(k) limits and other changes mean for your retirement | CNN Business

April 7, 2025 ~ knjohn ~ Leave a comment

Come next year, you will be allowed to save a little more in your 401(k) on a tax-deferred basis than you can this year, unless you’re in your early 60s, in which case for the first time you’ll be allowed to save a lot more.

The new contribution limit for 401(k)s and other workplace retirement plans in 2025 will be $23,500, up from $23,000 currently, the Internal Revenue Service said Friday.

The IRS did not, however, increase the limit on catch-up contributions — that’s the extra amount of money people 50 and older can contribute annually in tax-advantaged plans like 401(k)s, 403(b)s, 457 plans and the federal government’s Thrift Savings Plan. The catch-up contribution limit will remain the same at $7,500.

Source: What the new 401(k) limits and other changes mean for your retirement | CNN Business

Wondering if you should convert your tax-deferred retirement savings to a Roth? Here’s what to consider | CNN Business

April 7, 2025 ~ knjohn ~ Leave a comment

Having financial flexibility in retirement — especially in being able to maximize your spending while minimizing your taxes — is an optimal situation.

And it’s one you can arrange by keeping at least some of your retirement savings in a tax-free account.

“You’re giving yourself more options in the future,” said Brian Kearns, an Illinois-based certified public accountant and certified financial planner.

One way to do that is to convert at least some of your tax-deferred savings in your 401(k) or traditional IRA into a Roth account. Money rolled into Roth 401(k)s and Roth IRAs grow tax free and may be withdrawn tax-free so long as you leave it in the account for at least five years after the rollover.

A surprisingly hard part of retirement: Spending what you worked so hard to save | CNN

October 5, 2022October 4, 2022 ~ knjohn ~ Leave a comment

You’ve been working and saving for decades for just this moment: retirement.

Even though you may be ready to stop working full-time, now comes the hard part: Actually letting yourself use your savings, since you no longer will be bringing in that paycheck, which until now has covered your monthly expenses.

Making the psychological shift from saver to spender – not to mention nest egg manager – is no small feat for most people.

“Now you have this lump sum and have to draw it down. For some it’s almost physically painful,” said David John, a senior strategic policy advisor at the AARP Public Policy Institute.

30% Find Resetting Passwords as Stressful as Retiring | Small Business Trends

May 4, 2020May 3, 2020 ~ knjohn ~ Leave a comment

Password Statistics

The study found that 30% of people find resetting passwords to be hugely stressful. So stressful in fact, that it is comparable to the stress of retiring. 67% of respondents agreed that losing passwords is as stressful as dismissal or changing jobs.

Thought of Retirement is Stressful

It is no secret that the thought of retirement is stressful for many. A study conducted in 2018 found that 39% of small business owners say they are not confident they can retire. The research found the principle apprehension about retirement is due to financial reasons. Both small business owners and employees have concerns that they will not be financially prepared for retirement. The majority of respondents said being able to save more would increase their confidence about retirement.

The Difficulty of Password Management

Comparing losing passwords to the stress of retirement acutely shows the apprehension associated with having to reset passwords. NordPass’ study sheds light on why password management is so difficult. 66% of the survey’s respondents say it is because they have too many accounts to manage.

California’s high rents undermine tenants’ retirement chances | Fast Company

December 4, 2018December 3, 2018 ~ knjohn ~ Leave a comment

One of Bill Ware’s various jobs in recent years was as a part-time insurance salesman. In that role, he has helped people prepare for unexpected hardships—burglaries, falling trees, car accidents, medical emergencies, and even death. But Ware recently faced the unexpected himself when his income took a dive.

Early this year a tax consultancy that works to resolve problems with the IRS and state agencies hit a trough and, in April, he says, the consultancy suddenly cut his income by 60%. Soon after, as the credit card bills piled up, he realized he needed to take action.

What Non-Retirees Mean for the Workforce | PROFITguide.com

May 30, 2017May 30, 2017 ~ knjohn ~ Leave a comment

For all Hunter Harrison’s unquestionable talents, he is really bad at one thing: not working. The celebrated railway executive officially retired from Canadian National Railway Company (CN) in 2009, after a long career running railways. A little more than two years later, at the encouragement of activist investor Bill Ackman, Harrison came out of retirement to become president and CEO of Canadian Pacific Railway (CP).

His plan was to step away, again, this summer, when he was scheduled to hand the CEO reins to longtime lieutenant Keith Creel and start a three-year tenure as a consultant (or, in his own words, a “hired hand”) to the railway. That arrangement suggested the transition of power would be a gradual process. But earlier this year, CP announced Harrison would be departing immediately to pursue other opportunities. For his early departure, Harrison will forfeit some $118 million in benefits that had been awaiting him. Hours later, several reports emerged suggesting that Harrison will be partnering with another activist investor to take control of U.S. railway CSX Corp.

Half of Americans are Saving Next to Nothing | Money Cnn

March 30, 2015 ~ knjohn ~ Leave a comment

When it comes to saving, we aren’t doing enough of it.

Roughly half of Americans are saving 5% or less of their incomes, including 18% that are not saving anything, according to a survey from Bankrate. Only about a quarter of people are saving more than 10% of their earnings.

So how much should you be saving? Bankrate recommends 15%.

“Between emergency savings and the ever-increasing burden of retirement savings that is on the individual, the goal should be 15% of your income,” said Greg McBride, the personal finance website’s chief financial analyst.

Currently, one in seven people are saving more than 15%, the report showed.

You can stash up to $18,000 in your 401k next year | Money.Cnn.com

October 24, 2014 ~ knjohn ~ Leave a comment

Super savers and rich people will be able to put even more money in their 401ks next year. Starting in 2015, contribution limits for the tax-deferred retirement accounts will increase by $500 to $18,000, the Internal Revenue Service announced Thursday.

Meanwhile, the “catch-up” amount that workers age 50 and over can contribute to their plans will rise to $6,000 from $5,500, for a total of $24,000 next year.Of course, not many workers can afford to save those maximum amounts. In 2013, 12% of Vanguard’s more than 3 million 401k participants contributed the max allowed not including any match from their employer, according to the company’s annual How America Saves report.

A 401k Conundrum: Can You Make Cash Pile Last for Life? | Bloomberg

October 8, 2014 ~ knjohn ~ Leave a comment

Even if you’ve socked plenty of money away in your 401k plan and invested it carefully, some of your toughest decisions lie ahead. And don’t expect much help or clarity from the government or your employer. Strategies for drawing down lump-sum accounts in retirement — more important than ever in the 401k era — have received little attention from policy makers. For retirees, choices about how to spend a life’s worth of savings are fraught with tricky calculations about financial risk, taxes and death.