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1
Social Security “Free Loan” Loophole Redux
2
Hewitt Data Show Jump in 401(k) Company Stock Investments
3
Returning to our Roots
4
2008 Education Tax Breaks Are Expanded in Midwest Disaster Areas
5
Conforming Mortgage Limits Will Go Back Up Eventually

Social Security “Free Loan” Loophole Redux

Researchers over at Boston College’s Center for Retirement Research have analyzed the “interest-free loan” opportunity presented by the loophole in Social Security that I’ve discussed before. Once their findings reach Congress, I’m betting this loophole gets closed.

Alicia Munnell and her colleagues at the Center recently published a short note in which they examine the potential impact of the loophole.  The idea is this: normally, once you retire, your Social Security retirement benefit level is locked in – other than adjustments for inflation, it can’t go higher.  The older you are when you start taking Social Security, the bigger your …

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Hewitt Data Show Jump in 401(k) Company Stock Investments

Hewitt Data Show JumpHewitt Associates, the HR consulting firm, tracks 401(k) investing trends for 1.5 million employees of large (> 5,000 employee) companies. Their January 401(k) plan data show a curious fact: employees put more money into their employers’ stock than into any other category.

The Hewitt data are by no means comprehensive, as there are over 50 million 401(k) plan participants in the country, but theirs is one of the few surveys that tracks 401(k) investment behavior in the recent past – the most comprehensive retirement plan data are often more than a year old.  Hewitt’s index is interesting because it …

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Returning to our Roots

Lately, many people have asked me if they should consider turning their equity positions into cash. I know it is hard to see the S&P 500 decline like it has, and there is no denying that we are in the midst of a terrible bear market. However, it is important to remember that we are in the MIDST of the decline, not the beginning. The time to sell was 17 months ago, not now.

Unless you’re on the doorstep to retirement, you still have years to allow the market to work for you, not against you. A long-term investor should …

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2008 Education Tax Breaks Are Expanded in Midwest Disaster Areas

education tax breaksRecently I was listening to an IRS webcast on tax law changes (yes, it’s just as exciting as it sounds!) and something caught my attention. I was already aware that people living in disaster areas are eligible for various kinds of tax relief, but I realized that I’d missed an important fact. You don’t have to live in a disaster area to get a tax break; the Heartland Disaster Tax Relief Act of 2008 includes special provisions for educational expenses incurred by students attending college in areas struck by disaster in 2008. This article will be of interest even if

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Conforming Mortgage Limits Will Go Back Up Eventually

conforming mortgage limitsFor buyers in the most expensive housing markets, the rules concerning “conforming” mortgages have been confusing over the last year or so. Conforming mortgages are eligible to be purchased by Fannie Mae and Freddie Mac, the two government-run companies that together own or guarantee most home mortgages. One benefit of a conforming mortgage is the all-important interest rate: mortgages whose values exceed a specified amount are not conforming and typically carry interest rates that are ¾% or more higher than conforming mortgage rates.

Last year, the conforming loan limit of $417,000 was raised – but technically, it wasn’t.  According to …

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