Pension and annuity retirement policies were first implemented as a means to encourage older workers in employment to look for another jobs. Retirement has become a norm, the expected life of the stage, which has an institutionalized part of most modern societies. Workers expect to retire actively choose to withdraw from workforce as quickly as they are financially feasible. Once they are retired, they are expected to enjoy their life and get satisfaction with their lives. (more…)

The only way to pass a TIAA-CREF account beyond the current generation requires that you elect not to annuitize. You must instead elect the Minimum Distribution Option, because that avoids the conversion of the account into a premium. The first benefit, assuming that this comports with your values and resources, is that you will have responsibility for your own financial destiny. To underline the point, you have rejected the safety net of a lifetime annuity and have chosen instead to take distributions at your own pace, subject to the governmentally prescribed minimum. (more…)

In developing a retirement plan there are several factors to consider in addition to the amount you need or want to save.

1. Income Taxes.

The above discussion did not take into consideration income taxes. You might have to save more if you have to pay income taxes on all or part of your retirement benefit or your contributions. Distributions from qualified employer plans are always subject to retirement income tax. (more…)

In December 2002, the U.S. Treasury Department issued some long-awaited guidance to employers about cash balance plans. These proposed regulations, issued under Internal Revenue Code Section 411 (b)(1)(H), prohibit age discrimination employment in benefit accruals and are fairly comprehensive in nature. Although a public hearing on the regulations was held in April 2003, the rules are not yet final as this article goes to press.

In essence, the regulations generally indicate that a company cannot directly or indirectly affect a participant’s benefit accrual based on age. (more…)

In this part, we describe the various distribution options that are avail able for the withdrawal of your TIAA-CREF accumulation after you have retired. The rules governing almost all of these options originate in the Code. Again, we will try our best to describe them in nontechnical terms.

The transition from a working environment to retirement poses financial as well as emotional challenges. (more…)

When someone is entering retirement, it can be identified as a long sigh of relief from the stress of work routine. It is the time to free someone’s from work and enjoying life. The retirement age is the age at which you are free to work and follow your heart, for the rest of your life! Who gave a thought that life after retirement from the planning of their financial resources, usually early retirement and early retirement benefits? What to do after retire? But not all are so good, old in planning for retirement and has no chance to retire at age 40 or 50 years and live a peaceful life to come! (more…)

If we boil things down to a simple two-part equation, retirement planning is all about managing inflows (income) during your earning years and outflows (expenses) during your retirement years. Of course, retirement means different things to different people at different points in their lives. Rather than a static state, retirement is a dynamic state, changing with life events, financial events, and even your own education as you learn more about concepts and products. The more information you absorb, the more comfortable you feel in being an active participant in the retirement planning process. Your plan for accumulating assets for retirement has to take all of this into account and be flexible enough to adapt to all kinds of changes. (more…)

Periodic additions to income payments that enable recipients to purchase the same amount and quality of goods and services over time despite inflation. As experienced by older Americans, Cost of Living Adjustments are annual increases to Social Security benefits and other income payments that reflect the previous year’s inflation rate in urban areas. Although a common perception is that older persons dependent on Social Security are protected from losing purchasing power, in actuality, after a few years they often cannot maintain the level of retirement standard of living they had upon retirement and experience increases in their cost of living greater than increases in their retirement income. (more…)

Losing a job—at any age—is traumatic, even when a worker receives some severance pay. In addition to loss of income and/or employee benefits, there is a feeling of insecurity as one’s way of life is disrupted. Workers faced with involuntary retirement in later life must take stock of their financial resources, marketable job skills, and emotional readiness—or not—for retirement.

The federal COBRA (Consolidated Omnibus Budget Reconciliation Act) law provides an opportunity for continuation of health insurance for up to 18 months, at group rates plus a 2% administrative fee, until an individual policy (or new group coverage) is obtained or a worker is eligible for Medicare. (more…)

Like the peculiar behavior of the dog in the night in the Sherlock Holmes story “Silver Blaze,” one of the obvious but overlooked clues about the insurance orientation of TIAA-CREF appears in the names of the accounts that are given to the various accumulation alternatives available to you. Each account is labeled an “annuity,” and each contribution is called a “premium.” To avoid confusion you should note that what TIAA-CREF labels as an “account,” you probably would call an investment choice or fund.

Stripped to the basics, your Retirement Annuity (or “Retirement Annuity”) boils down to an accumulation agreement between you and TIAA-CREF. (more…)