Latest news with #RomiSavova
Yahoo
a day ago
- Business
- Yahoo
Delaying Your 401(k) Rollover Could Cost You $76K, Study Finds
Even though much of the financial world is now digitized, rolling over your 401(k) still often involves a more complicated process that can't be done online. Many plans require you to transfer funds via mail, which can lead to delays in getting your funds invested into your new account. Find Out: Read Next: While you might not think too much about the consequences of this lag time, it can lead to thousands of dollars in lost retirement savings, according to a new study conducted by PensionBee. Here's a look at how much you stand to lose due to delays in a 401(k) rollover. Putting off rolling over your funds and mail delays that are out of your control can have serious financial consequences, especially when you take a long-term view. According to the PensionBee study, even brief two- to eight-week market absences during rollovers can cost savers tens of thousands of dollars, particularly during periods of market volatility. The study found that for savers with a $100,000 401(k) balance, an eight-week processing delay could mean $76,000 in lost returns over 30 years. A $50,000 balance could experience a $38,442 loss due to an eight-week processing delay, and a $10,000 balance could experience a $7,688 loss. Even shorter-term delays can lead to significant losses — a two-week rollover delay could compound to a $37,512 loss over 30 years if you're starting with a $100,000 balance. Be Aware: As these figures show, delaying your 401(k) rollover can have significant financial consequences. But the risks of delaying a rollover go beyond lost returns. 'Everyone thinks they'd never forget a retirement account, but there are 30 million unclaimed accounts that tell us otherwise,' said Romi Savova, founder and CEO of PensionBee. 'For job-changers, each position can become another account left behind. The average person switches jobs 12 times, so the sheer volume of personal admin can be very difficult to manage.' Forgetting to roll over old accounts can make you subject to fees that can eat away at your savings. 'People are often unaware that there are fees associated with retirement accounts,' Savova said. 'While your employer may cover some or all of your fee burden while you're employed, that responsibility can shift entirely onto former employees, often with minimal notice.' If you have a 401(k) account with a balance of $7,000 or less, these fees can eliminate your entire savings. 'Employers can automatically force out small balances into poorly performing Safe Harbor IRAs, which can deplete balances entirely,' Savova said. 'These bad defaults are marked by high fees and low returns, often below 2%. If you don't act fast and have an account under $1,000, your employer may cash it out automatically, leaving you to foot the associated fees and tax penalties.' Rolling over a 401(k) can be a complicated task, but it's important to tackle it sooner rather than later. 'While the system needs to change, consumers can immediately take several steps to minimize downsides,' Savova said. 'First, take an active role in the process. Rolling over a 401(k) is a multistep process, and delays at any point can be costly. When it comes to retirement, time in the market is more important than timing the market — even a few weeks or months out can mean thousands lost over a lifetime.' If you're rolling a 401(k) balance from a former employer into a new 401(k), you may not have a lot of choices, but if you choose to roll into an IRA, make sure you are choosing your provider wisely. If possible, find a provider that offers digital-first solutions with automated tracking. 'The best providers will offer digital rollover solutions, avoiding checks in the mail, and excellent customer support when speaking with your old provider is inevitable,' Savova said. 'Customer-focused providers handle the paperwork burden, proactively follow up with your previous plan administrator and keep you updated throughout the process.' Also, pay attention to more than just fees when choosing a provider. 'While high fees over 1% should generally be avoided, also consider the customer support model and technological capabilities,' Savova said. 'The right provider becomes a partner in your retirement journey, not just a place to store your money.' More From GOBankingRates 7 Tax Loopholes the Rich Use To Pay Less and Build More Wealth This article originally appeared on Delaying Your 401(k) Rollover Could Cost You $76K, Study Finds
Times
3 days ago
- Business
- Times
Why a mid-retirement MoT can keep you on track
You get your car checked every year, and even the boiler gets a regular service — but when was the last time you gave yourself a money MoT? People are living longer than ever, and while this is a welcome development, it also presents a significant financial challenge: ensuring your pension pot can comfortably last the distance. For many people in their seventies, a mid-retirement MoT has become an essential part of managing their finances. By this stage, people tend to have settled into retirement and have a clear picture of their lifestyle and outgoings. This makes it easier to work out a sustainable rate at which to take money from their pension pot. Only 48 per cent of people aged between 65 and 75 are confident their savings will last their lifetime, according to a report by the insurance company Aviva and the charity Age UK. That's despite the fact that many people underestimate how long they will live. Many people assume that their spending patterns will be consistent through retirement, the survey of 1,000 people found. That's wrong — it is usually 'U-shaped', say experts, with higher initial outgoings, a potential decline in the middle years, and then a resurgence in later life, particularly if there are care costs. Romi Savova from the pension firm PensionBee said: 'Just as regular pension check-ins are essential before retirement, it is important to assess your income and spending once you're in retirement, and especially around the halfway point. 'A mid-retirement MoT is a good way to make sure your savings remain on track, particularly as your lifestyle, spending and health needs may have changed over time.' John Ford has planned meticulously. Ford, 73, has an inflation-linked defined benefit pension — which pays a guaranteed income — and a state pension, which together give him an annual income of about £36,000. He also has £340,000 in a defined contribution (DC) pension — which gives him a retirement income based on how well his investments perform — which he has barely touched. 'I am keeping it for emergencies and future medical bills,' Ford said. 'Last year I paid about £7,000 to remove cataracts at a private clinic as I didn't want to wait for a slot on the NHS. I also need some money to make some repairs to my property near Bristol.' Ford retired from his job as a surveyor in the construction industry in 2017, when he was 65. His wife, Carole, 70, retired four years ago and gets a state pension plus a small defined benefit pension, giving her an annual income of about £15,800. • Flip-flopping is chipping away at our faith in pensions Ford said: 'Luckily we have enough to live a decent lifestyle and our spending has not really changed much since we retired. However, we know we may need money later in life for care bills, which is what the DC pot is for.' Reviewing your finances once a year can help you to identify whether you need to rebalance your investments or make any adjustments to the amount that you are withdrawing, and to check that you are on track with your financial goals. Lucie Spencer from the wealth manager Evelyn Partners said: 'The early years of retirement are usually where most of the non-essential spending happens. For many people this is the first time they have had a substantial pot of money and total freedom to spend it as they wish. 'However, many do not plan for their later years. What will happen if they go into a care home or need support at home? Who will pay the bills if all their funds are spent? Will the state pension be enough to live on if they've exhausted all their savings? Such questions tend to become more pressing from the mid-seventies.' Withdrawing money from your pension is a fine balance — it needs to be enough to provide the lifestyle you want, without depleting your pot so fast that it runs out. A common guideline suggested by experts is to withdraw money at a rate of 4 per cent of the value of your pot per year. The idea is that since the rest is still invested, it should be able to replenish itself in time for the next withdrawal. Fidelity International, the wealth manager, analysed what happened to a £100,000 pension pot after ten years of withdrawals starting at 4 per cent a year and rising by 2 per cent each year to factor in inflation. Its analysis looked at withdrawals starting each year from 1994 to 2014 to see how much the pot would be worth after a decade. Based on a typical portfolio of 60 per cent global shares and 40 per cent in bonds, there were only three years (1999, 2000, and 2001) in which someone could have started taking annual income and been left with a pot worth less after a decade — in all other years the pot's value would have increased, even after ten years of withdrawals. For example, if someone had started making withdrawals of 4 per cent a year in January 2014, the value of their £100,000 pot would have grown to about £154,000 by January 2024. However, if they had started withdrawing in January 2000, the value of their pot would have fallen to £81,319 by January 2010, according to Fidelity's analysis. • Are you on track for your dream retirement? It is important to bear in mind that managing withdrawals can become problematic at times of stock market turmoil. When the market falls, so too does the value of your pot, as many savers experienced during the recent Trump tariff upheaval. Spencer said it was best to avoid withdrawing money at such times as it could mean locking in losses, and make it harder for the value of your pot to recover: 'During retirement if you are drawing down on your pension after a market shock, you could be selling investments at impaired values and that can deliver a serious blow to the longevity of your pot.' It is recommended that you have about a year's worth of spending, including bills, saved in cash which you can use instead during such times, allowing your investments to recover. An alternative to leaving your pot invested is to use some or all of it to buy an annuity, which provides a guaranteed income for life in exchange for a lump sum. Tom Selby from the investment platform AJ Bell said: 'Once you reach your seventies, you may start to consider whether drawdown is still the right option, or if using some of your fund for an annuity could be a good choice.' Life expectancy directly affects annuity rates — the longer you are expected to live, the lower the rate, because the income will have to paid out for a longer period. This means that if you buy an annuity later in life, you could get a higher income. A healthy 75-year-old with a £100,000 lump sum could secure an income of about £10,129 a year, according to the pension firm Just Group. That is about 30 per cent more than the £7,813 a 65-year-old is likely to get. Disclosing health or lifestyle factors that might reduce life expectancy, such as smoking or diabetes, could also mean you get a better rate. Shopping around for the best deal is always advised. Annuities do have drawbacks. The level of income is fixed so you may find it is not enough if your circumstances change, such as needing more money for care costs. You also forgo potential long-term investment growth, and unless you choose a policy that pays out to a surviving spouse, the income dies with you. A concern for older people in retirement is cognitive decline and the associated anxiety with technology, digital accounts, and a general loss of confidence in managing money, especially investments. It is important to arrange for someone to manage your money if you aren't able to do it yourself. 'I recommend all clients have a power of attorney in place in case they do start to lose mental capacity,' Spencer said. • Do I need to update my power of attorney? A lasting power of attorney is an official document that gives someone the authority to manage your financial and medical interests if you are no longer capable. There are two types of power of attorney — ordinary and lasting. The first is used as a temporary measure, for example if you are overseas and cannot do it yourself. The lasting power of attorney comes in two forms — health and welfare, and property and finance. One allows someone to make medical decisions on your behalf, while the other covers your money. It is usually advisable to have both. You can apply for both at the same time and must have them in place while you still have the mental capacity to give someone the authority to act for you. The forms can be downloaded from and each costs £82. You get a 50 per cent discount if your pre-tax income is less than £12,000 a year.
Business Wire
7 days ago
- Business
- Business Wire
PensionBee Launches SEP IRAs To Include Non-Traditional Retirement Savers
NEW YORK--(BUSINESS WIRE)--PensionBee, a leading online retirement provider, announced today the launch of Simplified Employee Pension (SEP) IRAs in its digital platform. This offering provides a best-in-class retirement solution designed for self-employed individuals. Self-employed Americans consistently report lower levels of retirement preparedness. Only about 13% of self-employed individuals in single-person businesses participate in retirement plans, compared to nearly 72% of traditional employees. Share The launch comes at a critical time as the gig economy continues its rapid expansion. By 2025, gig workers are expected to make up nearly 50% of the U.S. workforce. This structural shift in employment patterns has created an urgent need for retirement solutions tailored to non-traditional workers, as traditional employer-sponsored retirement benefits become inaccessible to a growing segment of the workforce. Self-employed Americans consistently report lower levels of retirement preparedness. Only about 13% of self-employed individuals in single-person businesses participate in retirement plans, compared to nearly 72% of traditional employees. Fewer take advantage of SEP IRAs, highlighting a significant opportunity gap. 'Pursuing your passions should not come at the expense of future retirement security,' said Romi Savova, CEO of PensionBee. 'The addition of SEP IRAs to our platform allows us to empower self-employed Americans who may not have access to traditional retirement plans. Everyone deserves to plan for and enjoy a happy retirement.' Unlike traditional employees, self-employed Americans lack access to employer-sponsored retirement plans, automatic enrollment, and employer matching contributions that typically boost retirement readiness. This structural disadvantage affects millions of entrepreneurs and independent contractors who represent a growing segment of the American workforce. In response, self-employed individuals are more likely to claim Social Security early, potentially reducing lifetime retirement income. Beyond individual benefits, PensionBee's SEP IRA offering addresses a critical economic need. Small businesses represent over 99% of all U.S. businesses and create approximately two-thirds of new jobs. Despite this, reports show that one in five small business owners don't have any retirement savings, and the majority have saved less than $50,000. By providing modern retirement solutions for single business owners, PensionBee not only supports individual financial security but strengthens the economic foundation of American entrepreneurship. PensionBee's SEP IRA allows individual account owners to contribute up to 25% of their income, significantly higher than Traditional IRA limits, creating a powerful vehicle for retirement wealth accumulation. This higher contribution ceiling enables entrepreneurs to make up for periods of variable income and accelerate their retirement savings during profitable years. PensionBee's SEP IRA offers a complete solution for self-employed individuals: Consolidation of existing accounts: Users can transfer old retirement accounts (Roth IRA, Traditional IRA, or 401(k)) into one manageable account Higher contribution limits: SEP IRAs allow contributions of up to 25% or $70,000 of income, maximizing tax-advantaged savings Human Support: Easy setup and management with dedicated human support Retirement planning tools: PensionBee's in-app retirement calculator allows users to model various scenarios to work toward savings goals The SEP IRA offering is available immediately to all self-employed individuals and single business owners. PensionBee users can begin the setup process now with dedicated BeeKeepers available to guide them through account creation. The addition of SEP IRAs represents a significant milestone in PensionBee's mission to democratize retirement planning for all Americans, regardless of employment status. The company plans to continue expanding its offerings to address the evolving needs of today's diverse workforce, with additional features and educational resources specifically designed for self-employed savers planned for later this year. PensionBee's SEP IRA is the latest addition to a robust offering of retirement account types, including Traditional, Roth and Safe Harbor IRAs. About PensionBee PensionBee (LON: PBEE) is a leading online retirement provider, helping people easily consolidate, manage, and grow their retirement savings. The company manages approximately $8 billion in assets and serves over 275,000 customers globally, with a focus on simplicity, transparency, and accessibility. For more information about PensionBee's SEP IRA offering, visit
Associated Press
7 days ago
- Business
- Associated Press
PensionBee Launches SEP IRAs To Include Non-Traditional Retirement Savers
NEW YORK--(BUSINESS WIRE)--May 28, 2025-- PensionBee, a leading online retirement provider, announced today the launch of Simplified Employee Pension (SEP) IRAs in its digital platform. This offering provides a best-in-class retirement solution designed for self-employed individuals. The launch comes at a critical time as the gig economy continues its rapid expansion. By 2025, gig workers are expected to make up nearly 50% of the U.S. workforce. This structural shift in employment patterns has created an urgent need for retirement solutions tailored to non-traditional workers, as traditional employer-sponsored retirement benefits become inaccessible to a growing segment of the workforce. Self-employed Americans consistently report lower levels of retirement preparedness. Only about 13% of self-employed individuals in single-person businesses participate in retirement plans, compared to nearly 72% of traditional employees. Fewer take advantage of SEP IRAs, highlighting a significant opportunity gap. 'Pursuing your passions should not come at the expense of future retirement security,' said Romi Savova, CEO of PensionBee. 'The addition of SEP IRAs to our platform allows us to empower self-employed Americans who may not have access to traditional retirement plans. Everyone deserves to plan for and enjoy a happy retirement.' Unlike traditional employees, self-employed Americans lack access to employer-sponsored retirement plans, automatic enrollment, and employer matching contributions that typically boost retirement readiness. This structural disadvantage affects millions of entrepreneurs and independent contractors who represent a growing segment of the American workforce. In response, self-employed individuals are more likely to claim Social Security early, potentially reducing lifetime retirement income. Beyond individual benefits, PensionBee's SEP IRA offering addresses a critical economic need. Small businesses represent over 99% of all U.S. businesses and create approximately two-thirds of new jobs. Despite this, reports show that one in five small business owners don't have any retirement savings, and the majority have saved less than $50,000. By providing modern retirement solutions for single business owners, PensionBee not only supports individual financial security but strengthens the economic foundation of American entrepreneurship. PensionBee's SEP IRA allows individual account owners to contribute up to 25% of their income, significantly higher than Traditional IRA limits, creating a powerful vehicle for retirement wealth accumulation. This higher contribution ceiling enables entrepreneurs to make up for periods of variable income and accelerate their retirement savings during profitable years. PensionBee's SEP IRA offers a complete solution for self-employed individuals: The SEP IRA offering is available immediately to all self-employed individuals and single business owners. PensionBee users can begin the setup process now with dedicated BeeKeepers available to guide them through account creation. The addition of SEP IRAs represents a significant milestone in PensionBee's mission to democratize retirement planning for all Americans, regardless of employment status. The company plans to continue expanding its offerings to address the evolving needs of today's diverse workforce, with additional features and educational resources specifically designed for self-employed savers planned for later this year. PensionBee's SEP IRA is the latest addition to a robust offering of retirement account types, including Traditional, Roth and Safe Harbor IRAs. For more information about PensionBee's SEP IRA offering, visit View source version on CONTACT: Media Contact: Adela McVicar [email protected] KEYWORD: NEW YORK UNITED STATES NORTH AMERICA INDUSTRY KEYWORD: PROFESSIONAL SERVICES BUSINESS APPS/APPLICATIONS TECHNOLOGY SOFTWARE FINANCE INTERNET SOURCE: PensionBee Copyright Business Wire 2025. PUB: 05/28/2025 09:14 AM/DISC: 05/28/2025 09:13 AM
Associated Press
13-05-2025
- Business
- Associated Press
PensionBee Introduces New Retirement Savings Calculator to Help Americans Plan for the Future
NEW YORK, May 13, 2025 (GLOBE NEWSWIRE) -- PensionBee, the award-winning online retirement savings provider, is making it even easier for Americans to take control of their financial future with the launch of its innovative retirement savings calculator. This powerful digital tool helps users create personalized retirement roadmaps while seamlessly integrating with PensionBee's existing features like easy contributions and 401(k) rollovers. New Tools for Smarter Savings Understanding how much to save for retirement remains one of America's biggest financial challenges. 7 in 10 Americans worry they won't be able to retire, or retire on their chosen timeline, and without proper planning tools, they risk financial insecurity in their later years. PensionBee's new savings calculator empowers users with a clear, personalized roadmap for their financial future. PensionBee's tool allows users to: 'We're committed to making retirement planning simple and accessible for everyone,' said Romi Savova, CEO of PensionBee. 'With our new savings calculator, easy contributions, and ongoing educational content, we're giving people the tools they need to take charge of their financial future. The ability to plan ahead and make informed decisions can be life-changing.' Addressing America's Retirement Knowledge Gap Millions of Americans struggle to navigate their retirement options, and a lack of knowledge often leads to costly mistakes. A Harvard Business Review study revealed that when changing jobs, over 41% of workers cash out their 401(k)s, and 85% deplete their savings entirely. This widespread practice poses a serious threat to long-term financial security. Financial literacy is essential to ensuring Americans make informed choices about their future. PensionBee's calculator builds on the company's commitment to financial education, which includes a digital library of content to support users' understanding of critical concepts like compound growth and contribution strategies. Additionally, PensionBee recently launched Retirement 101, a YouTube series with personal finance influencer Andy Hill, of Marriage Kids and Money, designed to demystify retirement planning. A Complete Digital Retirement Solution PensionBee removes the hassle from retirement planning by offering: Take Control of Your Retirement Today The new retirement calculator is available and accessible through the PensionBee app or website at no cost. Whether you're rolling over a forgotten 401(k) or using the new calculator to plan smarter, PensionBee makes retirement planning simple. To learn more, visit Media Contact: Adela McVicar - Sr PR Manager at PensionBee - [email protected] About PensionBee PensionBee is a leading online retirement provider, helping people easily consolidate, manage, and grow their retirement savings. The company manages over $8 billion in assets and serves over 275,000 customers globally, with a focus on simplicity, transparency, and accessibility. _______________________ PensionBee Inc. is registered with the Securities and Exchange Commission as an investment adviser. We do not provide in-person advice. PensionBee Inc (Delaware Registration Number SR20241105406 ) is located on 85 Broad Street, New York, New York, 10004 Photos accompanying this announcement are available at:
