Author: planeteria

News You Should Know: Scammers Increasingly Targeting Older Adults

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Why Finance Cons Target Older Adults, and How to Protect Yourself | NerdWallet

Fraudsters have been increasing their efforts to scam older Americans out of their money in recent years. The latest data from the FBI show losses of $3.4 billion last year from scams targeting people who are 60 and older, an 11% increase from the previous year. Here are some tips for spotting and avoiding some common scam techniques.

How 55,000 Coloradans Are Saving Up for Retirement | The Colorado Sun

Colorado SecureSavings, the state-facilitated retirement plan for private-sector workers without access to a plan through their employer, has enrolled more than 50,000 workers in its first year. In total, workers have saved more than $50 million, and the program is on track to nearly double its participants by the end of this year.

IRS Free File Tax Program Has Been Extended Through 2029 | CNBC

The IRS is continuing its Free File partnership with tax software companies while it determines the future of its own direct-file program. The Free File program, which allows some taxpayers to file their taxes using third-party software without paying fees, will continue through 2029. As for the agency’s plans for Direct File, which several states piloted this past tax filing season, the IRS expects to announce more soon.

What the Creator of the 401(k) Thinks of the Retirement Plan Now | Next Avenue

Ted Benna is credited with creating the first 401(k) retirement plan by taking advantage of new legislation in the early 1980s. Today, he says the plans haven’t quite lived up to their potential and he’s on a mission to help lower-income workers save more money for retirement.

News You Should Know is a digest of news from publications around the nation about finance, investing, and retirement.

2024 PERA Town Halls Taking Place on June 26

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Save the date—this year’s Town Halls with PERA executives are set for June 26.

PERA holds Town Halls each year after the release of the Annual Comprehensive Financial Report (ACFR), which contains details on the Plan’s finances and membership for the previous calendar year. The PERA Board of Trustees will release the 2023 ACFR at its June 21 meeting.

This year, participants will have the opportunity to meet PERA’s new CEO/Executive Director, Andrew Roth. He and the executive team will be taking questions live during two Town Halls.

This year’s Town Halls will once again be virtual, with the option to participate online, via social media, and on the phone.

Event details

Date and time: Wednesday, June 26

How to participate

There are multiple ways to take part in these virtual events:

Both Town Halls are open to anyone who would like to participate, but the content of each will be tailored to its respective audience.

If you’re unable to attend either event, recordings will be available afterward.

For more information, visit copera.org/townhall.

Q&A With PERA’s New CEO/Executive Director Andrew Roth

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Andrew Roth began his tenure as Colorado PERA’s eighth CEO/Executive Director on Monday, May 13.

PERA On The Issues sat down with Mr. Roth to learn more about him, his experience, and his perspective on the issues facing PERA and its members.

Answers have been lightly edited for length and clarity.

Tell us a little bit about your career and how you ended up working in public pensions.

I started my professional career with the California State Auditor as a performance auditor. The State Auditor taught me how to critically assess government programs and identify and review key documents. After working as a Public Information Officer for the California Department of Social Services, I joined the state securities regulator as their Director of Education and Outreach. There I championed anti-fraud and financial literacy education for seniors, military servicemembers, and youth. That work led to my entry at the California State Teachers’ Retirement System (CalSTRS) as the Director of Retirement Readiness. Most recently, I was Deputy Director of the Teacher Retirement System of Texas (TRS).

You have worked at some of the biggest public pension plans in the country. How do you think that will inform your leadership at PERA?

The experience I’ve gained at CalSTRS and TRS taught me that every pension system is both similar and yet unique. Pension systems share the need to serve members, engage with employers and stakeholders such as the Legislature, and attract and retain the talent necessary to administer a large financial institution with billions of dollars in assets. Each system also operates in a unique environment with its own plan design, statutory and regulatory frameworks, and the organizational culture cultivated by leadership. As I onboard with PERA, I will listen to the terrific talent already in place to determine what works and where opportunity lies to help advance the mission and serve our members.

PERA is often a topic of discussion at the State Legislature and beyond. What’s your approach to engaging with stakeholders?

I see the role of the CEO/Executive Director as one that is primarily external facing. While I will spend time working closely with the executive team and leadership on the high-level decisions my position is responsible for addressing, I will also prioritize serving as the face of Colorado PERA with its stakeholders. This includes member organizations, legislators, state and national pension associations, institutional investor organizations, and other key participants in the pension space. As the CEO/Executive Director, I will approach interactions with an open mind and a listening ear.

There’s been some renewed interest in defined benefit plans in both the public and private sectors. What’s your take on the future of pensions?

I’ve been a proponent of defined benefit plans for 20 years. They are—and in my opinion will remain—an effective solution for helping to ensure retirement security for all Americans. Given the vagaries of the stock market, and the challenge many people experience in making the right financial decisions necessary to fund a retirement, I believe defined benefit plans constitute a bedrock element in the nation’s retirement landscape.

As we develop our next strategic plan, what trends or issues do you think the PERA Board will want to address?

In my experience, the trustees of pension systems tend to focus their attention on issues that involve actuarial soundness, excellent customer service, operational effectiveness, and employer and stakeholder relations. Simply put, that equates to members, employers, financial issues, and operational concerns. I look forward to a collaborative process with the Board, executive staff, stakeholders, and the organization in building a roadmap to continued success for Colorado PERA.

Finally, if you could deliver one message to our active members and retirees, what would it be?

It is an honor and a privilege to serve as the CEO/Executive Director for Colorado PERA. I will work hard every day to ensure the retirement security of PERA’s hardworking members and the sustainability of the fund.

News You Should Know: Majority of Workers Say Benefits Influence Job Choices

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Employers Risk Facing Turnover Without Comprehensive Benefits Offerings | PLANSPONSOR

In a new survey, workers overwhelmingly said benefits are a key factor in determining where to work, with 70% of respondents saying they would be willing to switch jobs to gain better benefits. The survey found younger workers value education and training benefits, while 87% of older workers said retirement benefits are a top priority.

DOL Releases Final fiduciary Rule | ThinkAdvisor

The U.S. Department of Labor has released the final version of a new rule that clarifies who is considered a fiduciary when providing investment advice. Experts say the new rule adds protections for consumers, who can be more confident they’re receiving good financial advice that’s in their best interests.

Colorado Wants to Lower Prescription Costs. Why Are Patients Opposed? | The Colorado Sun

Three years ago, Colorado created the Prescription Drug Affordability Board to review drug prices and potentially place limits on how much manufacturers can charge for medications. Drugmakers have pushed back against the board’s authority, and some patient advocates have now joined the opposition out of fear that price caps could lead to manufacturers pulling their life-saving drugs from Colorado pharmacies.

What Do Women Think About Retirement? | National Institute on Retirement Security

There’s long been a gender gap in retirement, with women generally having less money saved due to lower wages and other factors. According to a recent survey of working women, more than 75% of women think retirement is only getting harder, and 82% say every worker should have access to a pension for retirement security.

News You Should Know is a digest of news from publications around the nation about finance, investing, and retirement.

News You Should Know: Insurers Warn Medicare Advantage Rate Cut Could Lead to Higher Premiums

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Federal Government Finalizes Modest Cut to 2025 Medicare Advantage Rates | Healthcare Dive

The Centers for Medicare and Medicaid Services (CMS) finalized the rates it will pay to insurers who run Medicare Advantage plans in 2025, and it’s a slight decrease from the current base rate. The federal government insists insurers will still come out ahead under the new rates, but insurance companies say lower rates could force them to cut benefits and raise premiums.

Vermont Plans to Partner with Colorado on State Auto-IRA Retirement Plan | PLANSPONSOR

Vermont is the latest state to team up with Colorado to administer its new state-run automatic individual retirement account (IRA) program for people who don’t have access to a retirement plan at work. Colorado’s plan, known as SecureSavings, has also helped auto-IRA programs in Maine and Delaware get off the ground.

Americans Think They Need Almost $1.5 Million to Retire. Experts Say to Focus on Another Number Instead | CNBC

For workers who rely on defined contribution accounts like 401(k)s for retirement, knowing how much to save can be a challenge. According to a recent survey, people think they’ll need about $1.46 million to retire comfortably. But experts say workers should be more focused on saving for their individual needs and goals rather than any particular dollar amount.

Writing a Will is Becoming Less Popular. Why Americans are Opting Out | USA Today

At the height of the COVID-19 pandemic, people saw the need to have a will on file, and estate planners saw a spike in people needing their services. Since then, the percentage of Americans adult who say they have a will had been steadily increasing. The most recent survey, conducted at the end of 2023, showed a reversal in that trend and marked the first decrease since 2020.

News You Should Know is a digest of news from publications around the nation about finance, investing, and retirement.

Lawmakers Pass Bill to Refresh Study on Value of PERA’s Defined Benefit Plan

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The Colorado Legislature this month approved a bill that directs the Office of the State Auditor to commission an updated study comparing the value of PERA’s hybrid defined benefit (DB) plan to other plan designs.

House Bill 1427 calls for the State Auditor, in cooperation with PERA, to enlist an independent actuarial firm experienced with public pensions to conduct a comprehensive study comparing the cost and effectiveness of the PERA DB Plan to alternative plan designs, as well as providing an analysis of certain aspects of PERA’s current defined benefit and defined contribution plans.

The study will be similar in scope and purpose to a study that took place following similar legislation in 2014. That study compared various facets of the PERA DB Plan—such as cost per member, contribution rates, income replacement ratio, and portability—to other public and private sector plan types, including Social Security. The study concluded that PERA’s plan provides a better benefit at a lower cost than other plans, making it the best option for providing retirement benefits to the state’s public employees.

READ MORE: Key PERA Features Make Colorado’s Largest Retirement Plan Efficient and Effective (from 2015)

As Colorado’s public workforce evolves, it’s important that Colorado PERA remain flexible enough to meet the membership’s changing needs. This study will help policymakers assess PERA’s continued value in recruiting and retaining a highly qualified public workforce in the years ahead.

If HB24-1427 is signed into law, the State Auditor and PERA will have until the end of October to select an actuarial firm. When the study is complete, PERA and the State Auditor will provide a report of the study’s findings to the governor, the Joint Budget Committee, the Legislative Audit Committee, and the House and Senate Finance Committees.

In addition to HB24-1427, lawmakers have passed two other PERA-related bills, both of which will expand provisions for PERA members who return to work in retirement. Those bills have been sent to the governor for his signature.

RELATED: 2024 Proposed Legislation Status

News You Should Know: Proposed Budget Includes Pay Raises for State Workers

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Will Pay Raises Be Enough to Stem Colorado’s State Worker Shortage? | The Colorado Sun

The General Assembly is currently considering the proposed 2024-2025 state budget, also known as the Long Bill. The $40.6 billion bill includes pay raises for some of the state’s hardest-to-fill positions, such as health care workers. Officials say the increases will help, but more work is needed to fill shortages that continue to persist in some sectors.

Pharma Targets Colorado Drug Affordability Board | POLITICO

Amgen, maker of the rheumatoid arthritis drug Enbrel, is suing Colorado’s Prescription Drug Affordability Board. The Board, which was created in 2021, declared Enbrel unaffordable in February, setting the stage for Colorado to set a maximum price for the drug. The drugmaker is challenging the Board’s decision and its authority to cap prices.

How a New Rule Could Change the Way Advisers Handle Your Retirement Money | The New York Times

The U.S. Department of Labor is preparing to release a final rule that will expand the number of financial professionals who are required to act as fiduciaries—meaning they must act in the best interest of their clients. The new rule is currently under review at the White House, after which it is expected to be published this spring.

IRS Has 940,000 Unclaimed Tax Refunds About to Expire | The Associated Press

The deadline for filing 2023 tax returns—April 15—is right around the corner. But the IRS says nearly a million people still haven’t filed and claimed their refunds from 2020. The unclaimed refunds amount to over $1 billion, and taxpayers have until May 17 to claim those refunds.

News You Should Know is a digest of news from publications around the nation about finance, investing, and retirement.

America Saves Week: Three Reasons to Save More This Year

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Saving money is always a good idea. Whether it’s for a rainy day or for a major purchase, saving now can help provide flexibility and security when big expenses come down the road.

April 8 through April 12 is America Saves Week, an annual initiative of the Consumer Federation of America, a nonprofit consumer advocacy organization. It promotes the value of saving money and the importance of making a plan to save.

Beyond peace of mind, here are some additional reasons to consider stashing away some more money this year, if you can.

Take advantage of high interest rates

The Federal Reserve started raising its key interest rate in March 2022 in an effort to fight inflation. Increases continued throughout 2023, and so far this year, the Fed is holding rates steady.

While the Federal Reserve rate mostly pertains to financial institutions, many banks have passed on those higher rates to their customers. That means interest rates on many savings accounts and certificates of deposit (CDs) are higher than they’ve been in years.

Some high-yield accounts, especially those offered by online banks, advertise rates of 5% annual percentage yield (APY) or higher. On a $5,000 account balance, 5% APY can result in $250 in interest earnings over the course of a year. That extra cash from interest could help you reach your goals faster or help you pay for an unexpected expense.

You may be eligible for a tax break

If you make pre-tax contributions to a retirement plan such as an IRA, 401(k), or 457 plan, you may already be reducing your taxable income. But you may also qualify for an additional tax break for a portion of your contributions, based on your income.

The Retirement Savings Contributions Credit, also known as the Saver’s Credit, offers a credit between 10% and 50% of eligible retirement plan contributions (for a maximum credit of $1,000 for single filers or $2,000 for joint filers).

For tax year 2023, the maximum income for a single filer to qualify for the Saver’s Credit is $36,500 ($73,000 for joint filers).

Boost your retirement security

PERA members are already setting aside money for retirement with every paycheck. Members in the PERA Defined Benefit Plan can count on PERA to provide monthly retirement income for life, but you’ll never regret having more money available in your golden years.

Whether you’re saving in a traditional savings account, an employer-based plan such as a PERAPlus 401(k) or 457 Plan, or even a health savings account (HSA) if eligible, additional savings can provide the flexibility to cover expenses that are hard to plan for. That could include costs like health care—one of the biggest (and growing) expenses—in retirement, long-term care, family needs, and housing.

Colorado PERA will be sharing more information and tips for America Saves Week on social media, so be sure to join the conversation on Facebook and Instagram.

News You Should Know: Retirees Are Being More ‘Intentional’ About Retirement

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Americans Living ‘More Intentionally’ in Retirement Post-Pandemic | National Association of Plan Advisors

In a recent survey by Fidelity Investments, two-thirds of American retirees said they’re being more “intentional” about their retirement and focusing on their passions in the years since the COVID-19 pandemic began. The survey also found that across generations, people are looking for a less traditional path to retirement. A majority said they want a “phased” retirement in which they continue to work while transitioning toward full retirement.

Credit Scores Decrease for the First Time in a Decade, FICO Reports | CNBC

Increases in credit card balances and other debt have led to the first decrease in the national average credit score, according to credit score agency FICO. The average had been steadily increasing since the Great Recession, but fell to 717 in late 2023. FICO found late payments and credit utilization were also up compared to prior years.

What Retirees Can Do Right Now to Reduce Next Year’s Taxes | Yahoo! Finance

If you’re retired, making sense of required minimum distributions (RMDs) and other tax implications can be confusing and overwhelming. Even if you haven’t started on your 2023 tax return yet, here are some factors to consider that could make your 2024 taxes a breeze.

How Caregivers Are Using Smart Tech to Help Aging Parents | The Verge

Older folks can sometimes be hesitant to embrace new technology, but smart home tech is proving to be useful for those aging at home. Smart devices can help loved ones and other caregivers check in more frequently and even help manage medication and other routine tasks. Here are some real-world examples of how caregivers are using modern technology to help make aging at home a little bit easier.

News You Should Know is a digest of news from publications around the nation about finance, investing, and retirement.

Recap of PERA Board’s March 2024 Meeting

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The Colorado PERA Board of Trustees met virtually on Friday, March 15 for its second regularly scheduled meeting of the year.

Below is a summary of key actions and discussions that took place during the meeting.

New Executive Director

At the beginning of the meeting, the Board announced it has selected PERA’s next Executive Director following an eight-month nationwide search.

Andrew Roth will fill that role beginning May 13. He comes to PERA from the Teacher Retirement System of Texas, and previously worked at the California State Teachers’ Retirement System and in various departments within the State of California.

READ MORE: PERA Board Names Andrew Roth as New Executive Director

Board election update

The Board announced in January that four Trustee seats would be up for election in May. At the March meeting, Trustees voted to move forward with elections for three of those seats—one in the School Division and two in the State Division.

The Denver Public School Division seat, currently held by Amy Grant, is uncontested. The Board voted to reappoint Grant to another four-year term beginning in July.

Members in the School and State divisions will receive ballots in May, and the Board will announce election results at its June meeting.

Legislative update

State lawmakers are halfway through the 2024 legislative session, and Public and Government Affairs Manager Michael Steppat joined Interim Executive Director/Chief Investment Officer Amy C. McGarrity to provide an update on PERA-related legislation.

So far this session, legislators have introduced more than 500 bills, seven of which pertain to PERA.

Of those seven proposed bills, one—HB24-1169, which would have repealed a 2016 law that requires PERA to divest all direct holdings from companies that have economic prohibitions against Israel—has died in committee. The other six remain under consideration at the State Capitol.

Steppat said it’s likely there will be some additional PERA-related legislation before the session is over. PERA On The Issues will continue to track all PERA bills and post updates when they’re available.

RELATED: An Update on 2023 WEP/GPO Legislation

Asset/liability study continues

The Board also received an update on its ongoing asset/liability study. That study, which is an in-depth analysis of PERA’s investment portfolio and strategy, will help the Trustees determine if any changes are needed to PERA’s asset allocation, or mix of investments.

The Board’s consultants, Aon, modeled several different asset allocation—some with more risk than the current portfolio and some with less—across thousands of different economic scenarios to project how each option might affect PERA’s investment returns and progress toward its funding goals.

Overall, PERA’s current portfolio is within a reasonable range, Aon said, but there may be some opportunities to further diversify in a way that increases the potential for higher returns without adding unnecessary risk.

Consultants and PERA staff will continue to work on a recommendation and will present more information at the next Board meeting.

The Board’s next regular meeting, which will also include the release of PERA’s 2023 Annual Comprehensive Financial Report and Investment Stewardship Report, is scheduled for June 21.