2015 2nd Qtr Issue - True Cost of Retirement, Housing Wealth Strategies, Retirement Happiness, DB Economic Efficiencies

2015 2nd Qtr issue – InFRE’s free newsletter

InFRE's 2015 2nd Qtr issue of Retirement Insight and Trends

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The quarterly newsletter from the International Foundation for Retirement Education’s to help retirement professionals keep abreast of what’s happening in the field of retirement readiness, counseling, planning and income management.

In this retirement-specific newsletter, planners will learn:

  1. How to calculate the true cost of retirement,
  2. The ins and outs of today’s home equity conversion mortgages (HECM) for retirement income,
  3. The three paths to retirement happiness, and
  4. How pension plans are able to provide retirement income at half the cost of defined contribution plans, providing ideas for creating a “personal pension” out of a DC plan or IRA.

The articles below comprise the 2015 2nd Qtr issue of Retirement Insight and Trends. Click on the links below to read each article online separately, or click here to view and print the issue in its entirety.


Welcome to InFRE’s June, 2015 Issue of Retirement Insight and Trends

on JUNE 30, 2015

Retirement InSight and Trends is the quarterly newsletter for the International Foundation for Retirement Education’s Certified Retirement Counselors® (CRC®s) to help retirement professionals with the practical application of new retirement readiness, counseling, planning and income management concepts for the mid-market. Find out more about the CRC® and […] Continue Reading →


June, 2015 InFRE Update: InFRE in the News

on JUNE 30, 2015

The International Foundation for Retirement Education® (InFRE) is a non-profit 501(c)(3) organization founded in 1997. Our mission is to raise the retirement readiness of the American worker through:
· Retirement-specification certification for professionals
· Retirement income and plan administration education
· Professional development/continuing education and training, and
· Retirement readiness research and tools for consumers/employees.
We are committed to […] Continue Reading →


Estimating the True Cost of Retirement

on JUNE 30, 2015

By David Blanchett, CFA, CFP®, AIFA® – Head of Retirement Research, Morningstar

When thinking about the actual cost of retirement, there are really two different sides to the equation. One side that gets the most focus in research is the asset side; what do I do with my assets to fund retirement? The other side though is just as important, and that’s the liability side. The liability is effectively the funding of your income goal in retirement. How much are you going to spend each year for the 30 or 40 years of the duration of retirement? For example, for those of you that work with defined benefit pension plans, it doesn’t matter what that portfolio does. That defined benefit plan is mandated to make a payment to a beneficiary every year for life. If the assets do well or if the assets do poorly, it doesn’t affect what is actually due to the individuals. A lot of professionals build a portfolio that is accumulation-focused and independent of the liability. But in reality, for most retirees, these are two different, but related concepts. […] Continue Reading →


The Longevity Challenge: Housing Wealth Strategies that Improve Portfolio Survival

on JUNE 30, 2015

By Bruce McPherson, CRMP – Reverse Mortgage Expert

A growing percentage of baby boomers and seniors have an unacceptably high risk of outliving their retirement portfolios. This is due to various trends such as increasing longevity and rising healthcare costs. For this reason, a recent survey showed that boomers and seniors fear running out of money more than they fear death.
For the past few years researchers in the financial planning field have begun to vocalize concern that housing wealth has been ignored in the financial planning process, despite the fact that housing wealth is a significant asset that can relieve pressure on the retiree, as long as it is used correctly.
How Retirees Can Access Their Housing Wealth through a Reverse Mortgage […] Continue Reading →


Retirement Happiness: Planning for a Successful Transition

on JUNE 30, 2015

By John E. Nelson, Purposeful Retirement Advocate, Author & Coach

Retirement happiness is a fascinating topic. First out of college, I started out as a financial advisor and then quickly moved into the pension area, designing, consulting and managing qualified retirement plans for employers. Pretty quickly, one of the things that I realized was that retirement finance is about people. One learning objective for this course is an idea and understanding of the relationship between income and happiness.
We toil away as individuals for decades and we work as advisors to help people establish a healthy and sufficient retirement income. What’s the relationship between income and happiness? We assume there is one, and of course we assume the more income, the happier we are. But let’s look at the science on that. The second learning objective by the time we finish today is that we’ll have an idea of what the main types of happiness are from research. […] Continue Reading →


Still a Better Bang for the Buck: An Update on the Economic Efficiencies of Defined Benefit Pensions

on JUNE 30, 2015

By William B. (Flick) Fornia and Nari Rhee, National Institute on Retirement Security (NIRS)

Over the past three decades, private employers have shifted away from defined benefit (DB) pensions that provide employees with a steady retirement income stream, towards defined contribution (DC) retirement accounts—such as 401(k) plans—in which individual workers manage their own investments. By and large, public employers have faced growing pressure since the 2008 financial crisis to make a similar change. Contrary to popular belief, however, DC retirement accounts are not inherently less costly than a pension, and switching from a DB to a DC system saves money only if it involves substantial benefit cuts.
In fact, DB pensions feature critical efficiencies that make them significantly less expensive to provide a given level of retirement benefit compared to DC plans. This was documented by the National Institute on Retirement Security (NIRS) in its 2008 study, “A Better Bang for the Buck: The Economic Efficiencies of Defined Benefit Pensions.”1 The study found that a typical large DB pension plan provides a given level of retirement benefit at about half the cost of a 401(k) style plan, because of three factors: […] Continue Reading →


Earn 1 free Continuing Education (CE) credit for the June, 2015 Issue of InFRE’s Retirement InSight and Trends

on JUNE 30, 2015

This issue of the June, 2015 issue of Retirement InSight and Trends is no longer eligible for CE credit.