RECENT developments summer 2017
Posted on: 6/8/2017 11:02 AM
Workers Stressed About Retirement
A recent Employee Beneﬁt Research Institute survey found that 31% of American workers feel very or somewhat stressed about preparing for retirement. Approximately 41% have tried to calculate how much they’ll need to save for retirement. Other steps taken to prepare for retirement included estimating how much income they would need in retirement each month (38%), estimating their Social Security beneﬁts (38%), and calculating retirement expenses (34%). About half of workers surveyed believe retirement planning (52%), ﬁnancial planning (49%), or health care planning (47%) educational programs would help boost their productivity at work.
Increase in Retirement Assets
According to the Investment Company Institute, employer-based deﬁned contribution plan assets increased to $7 trillion at the end of 2016, an increase of 1.3% from three months prior. Of the $4.8 trillion held in 401(k) plans, mutual funds managed $3 trillion. The most common types of mutual funds held in 401(k) plans were equity funds ($1.8 trillion) and hybrid funds, including target date funds ($835 billion). About two thirds of target date mutual fund assets at the end of 2016 were held in deﬁned contribution plans.
IRS Clariﬁcation on Loan Amounts
The IRS has issued a clariﬁcation about the calculation of the maximum loan amount available to retirement plan participants who have received multiple loans during the one-year period prior to the date of the loan. Speciﬁcally, the IRS stated that the statutory language requiring that the maximum available be reduced by the “highest outstanding balance of loans” during the one-year period ending the day before the date of the loan may be properly interpreted in two ways: either as referring to the single highest unpaid balance of all loans taken during the one-year period or of each such loan added together