Diversions May 28, 2015

Retirement Plans Look Murky for Many Small Businesses

Small-business owners brim with confidence in most areas of running their business—handling finances, knowing when to hire and managing employees—until it comes to their own retirement.
Reported by

More than one-quarter (26%) of small-business owners are not confident they will save enough to retire comfortably, according to a survey by TD Bank. The most jittery are Baby Boomers, with 28% saying they are not very or not at all confident that they have enough savings, compared with 21% of Millennials.

A possible key factor in this lack of confidence: Boomers started their current business at an average age of 43; Millennials began theirs at 26, on average, giving younger adults more time to expand the business and invest in retirement funds.

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Most business owners (73%) do not have a financial adviser or dedicated banker for financial planning and small-business needs. Most go to family and friends for advice (45%), followed by the Internet (36%).

Among other findings:

  • 47% of business owners said they do not yet have a retirement plan in place, while approximately one in four indicated that they would close the business.
  • 27% who started the company from scratch said they plan to close their business when they retire, compared with only 8% of those who took over an existing business.
  • 15% said they would transfer ownership of the business to family or co-workers.
Products May 27, 2015

Mercer Opens Pension Risk Exchange

In response to the increased demand for pension buyouts Mercer has developed a Pension Risk Exchange to support defined benefit plan sponsors in timing and execution of buyout deals.
Reported by

The exchange delivers buyout price transparency and deal readiness, while ensuring plan participants are protected, Mercer says. The solution helps plan sponsors execute a buyout at more competitive prices and in a shorter time frame than is currently possible. It assists in the decision-making process and in selecting the optimum timing of the transaction.

The exchange provides insurer engagement and enhanced competition in the buyout market; buyout price transparency based on up-to-date annuity pricing derived from plan-specific data; improved sponsor deal readiness by preparing data and documents in advance of the transaction; and enhanced participant security and complete execution support.

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A brochure may be downloaded from here.

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