The start of the New Year signifies a time of change in our lives, where we resolve to better ourselves after the knowledge and experience gained from the previous one.. Apart from the resolutions of self-betterment that we all seem to make, I would hope to see changes to retirement related laws and regulations, which could benefit us all.
Due to more pressing matters in Washington; I do not foresee any specific reforms to retirement, unless it is part of a “grand bargain” that addresses long term debt and fiscal issues. However, there are several changes that I would like to see, which could ultimately better the current state of retirement.
- Reform Social Security that would take long term financing issues off the table. There are many reasonable approaches that could work, including my proposal of updating Social Security to the new realities of older American workers.
- Change the taxation of income annuities to encourage middle market retirees to reduce investment risk and increase cash flow by electing lifetime payouts.
- Limit the excessive accumulation in Rollover IRA’s. Require faster and earlier distribution rather than restricting the types of investment or contributions.
- Improve the disclosure for complex annuity products. Requires better coordination between State insurance and Federal securities regulators.
- Define the fiduciary responsibility of anyone advising investors regarding retirement matters.
Whether or not these changes will come to fruition in 2014, I believe these five alterations to retirement laws and regulations could largely benefit any current or future retirees.
On behalf of the Golden Retirement team, we would like to wish you all a safe and happy New Year.