As is apropos right about now, this is the time of year to reflect on the comings and goings of the current year and give ourselves some lofty goals for the upcoming year based on the prior’s experience. I liked “this” about 2011, but I want to change “that” in 2012. Reflection, contemplation, and then a plan of action is created. These are our new year’s resolutions and the VAST majority of folks fail tremendously. That’s the fun of it, right?
I tend to steer clear of resolutions. While these are great goals with every intention of success when made, I cannot help but feel that the stroke of midnight on December 31 will not change much of anything. Our lives aren’t like that of Cinderella where midnight changes the outcome of some magical spell. The harsh realization is that years can fly by and there may be only small changes that affect our futures:
• Get fit: Eat better, workout more, be healthy.
• Learn more stuff: Speak a new language, take a craft class, do something…more!
• Be money conscious: Save more, spend less, get out of debt.
Yes, yes, and yes. But do you trust yourself enough to get this done? Will this diet actually work? Who will I speak Spanish to once I learn it? Do I have the extra money to put away???
In the end, it’s all about trust. Trust in yourself. Trust in the system. Trust in the future.
Many small business employees do not feel confident or trust in their future. Like many folks read Rolling Stone, Entertainment Weekly, and Cosmopolitan, I enjoy industry rags like Employee Benefit Adviser. In fact, their recent “ByTheNumbers” article really inspired me. How is it that one in five people plan to never retire? Almost one-third of workers feel that they will not retire comfortably. Further, there’s been an 18% rise in the delay of retirement by a minimum of three more years. Even a poll of my own friends and family have shown me that some are simply not saving.
I want to help all of these people. In the end, doing nothing is the worst you could do. Let’s go through this trust again, but let me show it from my perspective.
“Retirement Trust” is not an oxymoron
A retirement trust can be defined as a pooling of accounts with multiple folks managing under one unified agreement. Your 401k or IRA is considered a trust for all of the people working together to help you get to your retirement safely. Your Third Party Administrator (TPA) creates your legal documents and keep your plan running smooth without any IRS hiccups. Your Recordkeeper is there to balance your plan ever day down the penny and ensure timely funding of money into mutual fund. On top of that, you may have a financial advisor, CPA, or your own company backing you up.
You, my friend, are not alone. No one wants to be unprepared for retirement. It seems for the past three years that there have been articles in the Sunday paper all about 401(k) regulation changes. These new regs are specifically designed to protect you. One great example is the creation of Qualified Default Investment Alternatives (QDIAs). It’s long and jargony, but in the end, states that just putting your money in money market by default wasn’t the best idea. After all, how can it grow if it’s earning such a low return?? Now, your money is put into a collection of funds that will likely bring a better return.
Knowing you have an industry of folks behind you and looking out for your interests, should help that trust by a percentage point or two. By learning a bit more about your retirement, you will see the warning signs from providers who are looking to boondoggle you into an expensive plan just because you were confused or didn’t know. Many providers are out there to take advantage of your trust. Buyer beware, indeed.
Here’s to being confident and trusting in yourself and your future. It’s really all we have to look forward to.
Happy New Year! See you in 2012!