Morningstar has introduced Morningstar Retirement Income Strategist, a Web-based financial planning tool designed to help advisors create comprehensive analyses for clients who are nearing or in retirement. Retirement Income Strategist combines Ibbotson Associates’ Wealth Forecasting Engine with Morningstar’s investment research, design, and technology. Joe Mansueto, chairman of Morningstar, called Retirement Income Strategist “our most sophisticated planning tool for advisors that identifies whether an individual’s savings will last during retirement and explores alternative scenarios for sustaining income during retirement.” Key features include capital markets assumptions from Ibbotson as well as tax-sensitive and inflation-adjusted Monte Carlo forecasting which calculates the chance of meeting income and estate goals.
JPMorgan Retirement Services said September 5 that it planned to acquire Chicago-based CCA Strategies LLC, a major employee benefits and compensation consulting firm, and its affiliates. The deal was expected to close in 90 days. CCA Small Business Group, which provides retirement plans and services for sole proprietors and small businesses, is the creator of the individual defined benefit plan used by many advisors called MyMax, as well as the OurMax Retirement Plan that combines the benefits of large deferrals under a DB plan with the advantages of a 401(k) plan.
A new study by New York Life’s LTC Division has found that the average cost of nursing home care in the U.S. jumped significantly in 2006. Costs for both private and semi-private care were 6% higher in 2006 than in 2005, the study found. The average cost of a private room with a single occupant climbed to $204 per day, or $74,445 per year, according to the study. Non-private rooms, based on double occupancy, jumped to an average of $180 per day, or $65,700 per year. Nationwide, the average private room rate increased by $11 per day, or $4,015 per year. The average semi-private room rate rose by $10 per day, or $3,650 per year. Alaska charges the most for nursing home care, with an average cost for private nursing home care in 2006 of $388 per day. Southern Connecticut comes in second at $366 per day. New York’s Hudson Valley and New York City tied for fourth most expensive with average daily costs of $311.
On November 10, the 401(k) turned 25, and is now the U.S.’s leading private retirement plan, according to the Investment Company Institute (ICI). A new study by the ICI has found that 401(k) plans now have 47 million active participants, compared to 21 million people who participate in private-sector defined benefit pensions. 401(k) plans held $2.4 trillion in assets in 2005, compared to $1.9 trillion in assets in all private-sector DB plans. Copies of the study, 401(k) Plans: A 25-Year Retrospective, are available through the online December 2006 Table of Contents at www.investmentadvisor.com.
David C. John, senior research fellow at the Heritage Foundation, joined the Retirement Security Project (RSP) on November 15 as a senior advisor. At RSP, which is supported by The Pew Charitable Trusts in partnership with Georgetown University’s Public Policy Institute and the Brookings Institution, John will focus on how to make saving more automatic and more rewarding for middle- and low-income households through the automatic IRA and through changes to the asset tests associated with means-tested benefit programs. John is set to focus initially on the automatic IRA, an RSP supported retirement savings initiative that could provide an automatic savings mechanism to the 71 million Americans who are not offered a pension at work.