Our daily roundup of retirement news your clients may be thinking about.

How 401(k) plans have fueled inequality in America
As the stock market has increased in recent years, wages have stagnated. So while workers who are able to invest in a 401(k) have enjoyed the gains, lower-income workers have missed out, according to this article in Businessweek. As workers haven't experienced a raise in salary, only people with higher pay are able to contribute more to their 401(k) plans and end up gaining more from the stock market because of having bigger stock investments. While the 401(k) plans enable more people to own stock, those lower-income workers are likely to tap their 401(k) savings when they lose their jobs or file for divorce. Such a move could mean penalties and long-term consequences to their nest egg and retirement prospects.¬ĖBusinessweek

It pays to shop for Medicare insurance plans
Retirees are advised to shop around for Medicare insurance plans during the open enrollment which will end on Dec. 7, as premiums of their current policies could increase, according to an article on CBS Moneywatch. Since they are likely to have out-of-pocket expenses under traditional Medicare, retirees need to get a Medigap policy with the most flexible terms to have these bills covered. To shop for a Medigap policy retirees should seek help from a professional advisor and ensure that their favorite health providers are covered by the policy.  --CBS Moneywatch

A conservative retirement saver portfolio
Clients approaching retirement may consider having a conservative retirement saver portfolio with a higher stock allocation since bond yields are likely to dwindle and reduce returns, according to Morningstar. Such a portfolio may have more than 50% stock allocation, which is lower compared with those in moderate and aggressive saver portfolios. However, the portfolio may not work for some pre-retirees, especially those who will depend on pensions as source of retirement income and have a higher tolerance for volatility risk characteristic of a stock-heavy portfolio.--Morningstar

What's happening to your Social Security in 2015?
The increase in Social Security benefits as a result of inflationary adjustment may not be enough to cover the rising cost of living of retirees, according to this article on Motley Fool. This is because the inflation in health care expenses increases faster than the overall inflation rate. Clients who will depend mainly on Social Security when they retire are advised to plan on how to deal with these expenses, and should consider investing to help offset the impact of inflation in the future.  --Motley Fool

How companies can improve their 401(k) plans
Employers can improve their 401(k) plans if they provide their employees the option to automate their savings, according to a commentary article in USA Today. Companies may also offer professional services to help 401(k) participants make wise investment decisions, as well as include a Roth option. Another way of improving their 401(k) plans is to allow their part-time employees to participate and bolster their communication with their workers concerning plan issues. -- USA Today

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