Fidelity has released new year’s retirement savings resolutions for people in three different age brackets— 25-35, 36-54 and those 55 and older, reports EBN sister title Money Management Executive.
As the New York Lottery slogan goes, “You have to be in it to win it,” and this, certainly, is the foremost message for young investors age 25-35: Enroll and contribute to your workplace savings plan. Underscoring how important this is, Fidelty found that only 47% of those polled are investing in their 401(k).
Second, Fidelity calls upon young people to develop a plan to reach their goals. Only 25% of those polled had done so.
Third, Fidelity calls upon people to open and contribute to an IRA (20% of responding workers have done this).
For those age 36 to 54, Fidelity advises monitoring and rebalancing portfolios at least once a year. (Only 25% have done so.) Following this, it’s wise to catch up and/or max out on retirement savings vehicles, particularly as income rises, but only 19% are doing so, the firm reports. In 2009, workers age 50 and older will be able to contribute an additional $5,500 a year to their 401(k) and an additional $1,000 to their IRA.
Third for middle-aged people, Fidelity suggests simplifying and consolidating rollover assets into one IRA, although only 11% of respondents have done this.
Lastly, for those people age 55 and over who are nearing retirement, Fidelity’s first guideline is to plan to wait until at least age 62 to begin taking out Social Security payments and Medicare. This age group also needs to focus on creating a retirement income plan (only 26% have done this) and researching long-term care insurance needs (a mere 15% have).
“Creating an income plan that manages risks, such as longevity, market volatility and rising healthcare costs, is critical, as the median retirement savings of an American household is $22,500 and is on track to replace only 58% of pre-retirement income,” Fidelity said.
“The New Year offers investors an opportunity to take better control of their finances and stay on track throughout 2009,” suggested Fidelity Executive Vice President Carolyn Clancy. “These resolutions offer investors very specific steps to consider that can provide more financial discipline and better prepare them for retirement.”
Wednesday, December 31, 2008
News You Can Use: Specialty drugs driving Rx cost increases
A report from Haldy McIntosh and Associates for Medco finds 60% of plan sponsors believe that specialty medications are the leading driver of spending growth. This is a sharp increase over last year's survey, where only 25% of respondents shared this view.
To help curb rising costs, plan sponsors are considering programs like pharmacogenomics (personalized medicine, in plain English). Such programs include genetic testing to find how an individual will metabolize a drug to ensure it is prescribed in the right dose.
Other cost-cutting strategies are more conentional, with 65% of organizations offering a wellness management program, 70% a disease management program 46% planning to increase cost sharing over the next 18 months.
Click here to read EBN coverage of how one employer brought specialty pharmacy costs under control.
To help curb rising costs, plan sponsors are considering programs like pharmacogenomics (personalized medicine, in plain English). Such programs include genetic testing to find how an individual will metabolize a drug to ensure it is prescribed in the right dose.
Other cost-cutting strategies are more conentional, with 65% of organizations offering a wellness management program, 70% a disease management program 46% planning to increase cost sharing over the next 18 months.
Click here to read EBN coverage of how one employer brought specialty pharmacy costs under control.
Tuesday, December 30, 2008
Tip of the Day: Make 'SMART' new year's resolutions
People typically have well-meaning aspirations when it comes to setting their New Year’s resolutions. Actually sticking to those resolutions is of course more difficult. The personal health coaches at Gordian Health Solutions are sharing their tips for keeping 10 common new year’s resolutions. According to Gordian, it is important to make “SMART” resolutions (Specific, Measurable, Achievable, Rewarding, Timely).
Their list for making 10 SMART-er resolutions:
1. “Start working out." Make the action steps more specific, like, “I will walk on the treadmill for 30 minutes, three to four times a week” or “I will wear a pedometer to work.”
2. “Lose weight” or “Lose 30 pounds.” Make your goal more achievable and timely, like “I will lose 5 pounds by the end of the month.” Then come up with action steps involving nutritional changes, exercise, etc.
3. “Eat better.” Change your thinking from, “I’m going on a diet,” to “I’m making lifestyle changes to improve my eating habits.” Consider keeping a food journal to find specific areas you can change. Specific action steps could be limiting sweets and fast food and eating more fruits and vegetables.
4. “Quit smoking.” Set a realistic quit date. Make sure you're not setting yourself up to fail by trying to quit during a stressful time. Talk to your doctor and consider using nicotine replacement therapy such as nicotine patches, gum or medications. Clear your home of all smoking-related paraphernalia (cigarettes, lighters, ashtrays). Set action steps to reduce tobacco intake slowly, like “I will cut back by one cigarette per day over the next week.” Also think about a plan to deal with cravings and challenging situations.
5. “Reduce stress.” Identify and write down your stressors. Identify positive steps you can take when feeling stressed and what sources of support you have. A realistic action step might be something like, “During times of stress, I will practice deep breathing techniques, write in a journal or go for a walk to clear my head.”
6. “Give up fast food.” It is not always possible for some people to give up all fast food, so begin by familiarizing yourself with the healthier options on fast food menus. Try using restaurants’ websites to look up nutrition information, or pick up nutrition pamphlets inside restaurants.
7. “Stop drinking soda.” It may not be realistic to cut out all soda at once. Think about ways to decrease the amount of soda you are drinking. For example, try mixing diet soda into regular to cut the calories, or try substitutions like flavored water, unsweetened tea or green tea.
8. “Drink more water." Set realistic, specific steps like, “I will get a water bottle to carry with me” or “I will replace high-calorie beverages with water or flavored water.”
9. “Get more sleep.” Set a specific bedtime, and stick to a consistent schedule to get your body adjusted. Families with children can especially benefit from having a consistent routine for getting to bed at the same time each night.
10. “Cut back on alcohol.” Quantify how much alcohol you are drinking now. Decide what might be a realistic amount to cut back to. For example, if you typically drink six or eight beers, limiting yourself to two beers might be your goal. If needed, devise a step-by-step plan with action steps like, “I will remove alcohol from my home” or “I will avoid situations where alcohol will be served.” Identify supportive people or join a support group.
Their list for making 10 SMART-er resolutions:
1. “Start working out." Make the action steps more specific, like, “I will walk on the treadmill for 30 minutes, three to four times a week” or “I will wear a pedometer to work.”
2. “Lose weight” or “Lose 30 pounds.” Make your goal more achievable and timely, like “I will lose 5 pounds by the end of the month.” Then come up with action steps involving nutritional changes, exercise, etc.
3. “Eat better.” Change your thinking from, “I’m going on a diet,” to “I’m making lifestyle changes to improve my eating habits.” Consider keeping a food journal to find specific areas you can change. Specific action steps could be limiting sweets and fast food and eating more fruits and vegetables.
4. “Quit smoking.” Set a realistic quit date. Make sure you're not setting yourself up to fail by trying to quit during a stressful time. Talk to your doctor and consider using nicotine replacement therapy such as nicotine patches, gum or medications. Clear your home of all smoking-related paraphernalia (cigarettes, lighters, ashtrays). Set action steps to reduce tobacco intake slowly, like “I will cut back by one cigarette per day over the next week.” Also think about a plan to deal with cravings and challenging situations.
5. “Reduce stress.” Identify and write down your stressors. Identify positive steps you can take when feeling stressed and what sources of support you have. A realistic action step might be something like, “During times of stress, I will practice deep breathing techniques, write in a journal or go for a walk to clear my head.”
6. “Give up fast food.” It is not always possible for some people to give up all fast food, so begin by familiarizing yourself with the healthier options on fast food menus. Try using restaurants’ websites to look up nutrition information, or pick up nutrition pamphlets inside restaurants.
7. “Stop drinking soda.” It may not be realistic to cut out all soda at once. Think about ways to decrease the amount of soda you are drinking. For example, try mixing diet soda into regular to cut the calories, or try substitutions like flavored water, unsweetened tea or green tea.
8. “Drink more water." Set realistic, specific steps like, “I will get a water bottle to carry with me” or “I will replace high-calorie beverages with water or flavored water.”
9. “Get more sleep.” Set a specific bedtime, and stick to a consistent schedule to get your body adjusted. Families with children can especially benefit from having a consistent routine for getting to bed at the same time each night.
10. “Cut back on alcohol.” Quantify how much alcohol you are drinking now. Decide what might be a realistic amount to cut back to. For example, if you typically drink six or eight beers, limiting yourself to two beers might be your goal. If needed, devise a step-by-step plan with action steps like, “I will remove alcohol from my home” or “I will avoid situations where alcohol will be served.” Identify supportive people or join a support group.
News You Can Use: Recession to affect workers more deeply
The ongoing recession already has affected employees, as the number of employers implementing layoffs and hiring and salary freezes has risen sharply in the last two months, according to a new survey from Watson Wyatt, and the cuts likely will continue into next year, the consulting firm finds.
Watson Wyatt reports that 23% of employers plan to make layoffs in the next 12 months, and an additional 18% are planning a hiring freeze over the same period.
“As the economic downturn has both broadened and deepened, companies in almost every industry can no longer stay the course,” says Laura Sejen, global director of strategic rewards consulting at Watson Wyatt. “The need to contain costs has resulted in stronger measures that are ultimately affecting more workers.”
Among the other cost-cutting measures employers have planned over the next 12 months to survive the recession:
* Organization-wide restructuring 21%
* Eliminate/reduce training 18%
* Raise employee contribution to health care premiums 17%
* HR function restructuring 21%
* Salary freeze 19%
* Reduce/eliminate other employee programs 12%
* Salary reductions 6%
* Reduce employer 401(k)/403(b) match 7%
Findings show that almost two-thirds of companies have already taken five or more of the actions above.
“All indications are that 2009 will be a difficult year for both companies and ultimately employees,” said Sejen. “It will be up to employers to find an effective way to manage this challenge by balancing their financial situations with the likely impact on employee engagement.”
Watson Wyatt reports that 23% of employers plan to make layoffs in the next 12 months, and an additional 18% are planning a hiring freeze over the same period.
“As the economic downturn has both broadened and deepened, companies in almost every industry can no longer stay the course,” says Laura Sejen, global director of strategic rewards consulting at Watson Wyatt. “The need to contain costs has resulted in stronger measures that are ultimately affecting more workers.”
Among the other cost-cutting measures employers have planned over the next 12 months to survive the recession:
* Organization-wide restructuring 21%
* Eliminate/reduce training 18%
* Raise employee contribution to health care premiums 17%
* HR function restructuring 21%
* Salary freeze 19%
* Reduce/eliminate other employee programs 12%
* Salary reductions 6%
* Reduce employer 401(k)/403(b) match 7%
Findings show that almost two-thirds of companies have already taken five or more of the actions above.
“All indications are that 2009 will be a difficult year for both companies and ultimately employees,” said Sejen. “It will be up to employers to find an effective way to manage this challenge by balancing their financial situations with the likely impact on employee engagement.”
Monday, December 29, 2008
Tip of the Day: Get those SSNs to CMS
Effective Jan. 1, employers will be required to submit to the Centers for Medicare and Medicaid Services Social Security numbers for covered workers and dependents to comply with a new federal mandate. You've been hearing about this for months, but if you're like us, there's no time like the last minute! Your health insurance carrier likely has already buzzed you about collecting the information.
Among the 411 you'll need to provide:
Tax ID number
Total number of full-time and part-time employees (even those not enrolled in your health plan)
Social Security Number (SSN) for employees and dependents enrolling in new plans as of Jan. 1, and for all plan members by Jan. 1, 2010
Got questions? Click here for a document that should help. If it doesn't, there's still stime to contact CMS. Click here to submit a question.
Among the 411 you'll need to provide:
Tax ID number
Total number of full-time and part-time employees (even those not enrolled in your health plan)
Social Security Number (SSN) for employees and dependents enrolling in new plans as of Jan. 1, and for all plan members by Jan. 1, 2010
Got questions? Click here for a document that should help. If it doesn't, there's still stime to contact CMS. Click here to submit a question.
News You Can Use: Employers make revamping reitree medical a resolution for 2009
A new survey from ISCEBS and Towers Perrin indicates that employers are considering bold changes in 2009 to rein in retiree medical costs.
With more than 70% of respondents still offering retiree medical benefits to current retirees and some active workers, cost increases -- compounded by the current recession -- are a significant force influencing change in their programs to offload trend risk and begin to distance themselves from plan sponsorship and administration.
For pre-65 retirees, employers continue to wrestle with difficult challenges given the lack of access to affordable individual insurance for this high-cost population. The absence of affordable company-sponsored pre-65 coverage means that many older employees will delay retirement, presenting another significant workforce issue for employers. Although about two-thirds of respondents subsidze between 40% and 80% of plan costs, employers increasing are capping their benefits, with 48% of employers reportung such a cost cap, up from 43% last year.
While only 7% of employers have ceased financial support for pre-65 coverage in the past two years, 42% have either changed or plan to change cost-sharing between company and retiree. As part of this shift, a 34% of employers have introduced, or plan to introduce, HSAs to retirees as a means to promote tax free retiree medical savings.
For post-65 retirees, financial pressures on employers and retirees are similar to those for pre-65 retirees. Many employers (60%) who have capped their subsidy report plan costs in excess of the cap. Almost 40% have or will recast cost-sharing terms with post-65 retirees, and almost 20% have ceased – or plan to cease – providing any post-65 financial support at all.
Click here for extended coverage in the Sept. 1 and November issues of EBN about employers' strategies for retiree medical benefits.
With more than 70% of respondents still offering retiree medical benefits to current retirees and some active workers, cost increases -- compounded by the current recession -- are a significant force influencing change in their programs to offload trend risk and begin to distance themselves from plan sponsorship and administration.
For pre-65 retirees, employers continue to wrestle with difficult challenges given the lack of access to affordable individual insurance for this high-cost population. The absence of affordable company-sponsored pre-65 coverage means that many older employees will delay retirement, presenting another significant workforce issue for employers. Although about two-thirds of respondents subsidze between 40% and 80% of plan costs, employers increasing are capping their benefits, with 48% of employers reportung such a cost cap, up from 43% last year.
While only 7% of employers have ceased financial support for pre-65 coverage in the past two years, 42% have either changed or plan to change cost-sharing between company and retiree. As part of this shift, a 34% of employers have introduced, or plan to introduce, HSAs to retirees as a means to promote tax free retiree medical savings.
For post-65 retirees, financial pressures on employers and retirees are similar to those for pre-65 retirees. Many employers (60%) who have capped their subsidy report plan costs in excess of the cap. Almost 40% have or will recast cost-sharing terms with post-65 retirees, and almost 20% have ceased – or plan to cease – providing any post-65 financial support at all.
Click here for extended coverage in the Sept. 1 and November issues of EBN about employers' strategies for retiree medical benefits.
Monday, December 22, 2008
Programming note: Daily Diversion takes holiday hiatus
The Daily Diversion will take a much-needed holiday break Dec. 22-Dec. 26. New posts will resume Monday, Dec. 29. The EBN/DD staff wishes all readers a safe and happy holiday season.
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