When retirees roll over assets from a 401(k) to an individual retirement account, 75% reduce their equity exposure, according to research from J.P. Morgan Asset Management and the Employee Benefit Research Institute.
The research, based on data EBRI collected and studied on 31,000 people as they entered retirement between 2013 and 2018, also found that required minimum distributions appear to be the dominant withdrawal “guidance.” The vast majority of retirees, the research found, did not take distributions before they reached the RMD age, and those older than the RMD age choose to take only the RMD amount.
“The RMD approach is inefficient,” said Katherine Roy, chief retirement strategist at J.P. Morgan Asset Management. “It does not generate income that supports retirees’ declining spending behavior and may leave a sizable account balance at age 100.”
Another key finding was that income and spending in retirement are highly correlated. As income increases with the start of Social Security and RMDs, spending increases, with households that have regular income from an annuity and/or a pension spending more even if they have similar levels of observable retirement wealth.
"I just feel like I can get a lot further [by] opening a 529 account," said one respondent to the BabyCenter survey on Trump accounts.
New ICI research shows these retirement savers pay expense ratios nearly matching industrywide averages, extending years of fee declines
UBS data show American net worth is shifting from property to cash and funds faster than in seven other wealthy nations.
RBT CPAs combination lifts assets at UHY's fledgling RIA unit more than tenfold in the firm's first year.
Financial services trade groups back new authority letting mutual funds pause suspicious redemptions from vulnerable investors
Dan Biagini of American Equity says the steady decline of pensions, longer lifespans and a reset in interest rates are rewriting how advisors build retirement income
Direct indexing is on pace to outgrow ETFs and mutual funds. Northern Trust's Ken Lassner explains why the advisors who get it wish they had started sooner.
