Retirement

HSBC released its fifth annual "Future of Retirement" study. The study is the largest of its kind, covering over 15,000 people in 15 countries. The report suggests a perfect storm of demographic, individual and financial factors that have the potential to derail the retirement plans of millions of people around the world: Stephen Green, Group chairman of HSBC, said: "A perfect storm is confronting pensions planning, created by an ageing population, falling pension funds values, a drop in state...

The head of an Australian financial service firm's life operations, Richard Howes, is an advocate of compulsory annuitization . Howes believes that 30 percent of retirement funding should be compulsorily assigned to guaranteed income streams--in other words to annuities. Howes also suggests that the relatively slow take-up of annuities in the Australian market is a result of investors who have been conditioned by a uninterrupted 20 year bull market in equities. Howes spells-out the case for...

Vanguard founder John Bogle suggests that buy and hold investing is not dead. Similar to Warren Buffett, Bogle's preferred time horizon for equity investments is forever. Bogle urges caution for anyone who is thinking of investing in equity market with a time horizon of less than 10 years--which, by the way, would include almost all people who are approacing or in retirement: If you said "What kind of a time horizon should I have to be in the stock market?" If you are not in the stock market, I...

The use of annuities in 401k plans is an issue receiving quite a bit of attention lately. Experts, policy makers and industry analysts understand the clear need for guaranteed income options for people who have their savings built-up in 401k plans and individual retirement accounts (IRAs): “I think one of the top goals of the new (Obama) administration is to find a way to annuitize or at least guarantee or secure some sort of income in retirement,” said Mr. Davies. “That's really the final...