Planning for Retirement

 

partment to determine what benefits can be expected, at what age they can begin to be drawn, what the survivor benefits are, whether the retirement benefits are affected by Social Security benefits, and what the vesting schedule is. Vesting refers to an employee being able to retain his or her retirement benefits if a change of employer occurs. When those questions are answered, the vast majority of people, with the exception of some high-level executives, will recognize the need to do at least a moderate amount of supplementary saving for retirement—even those with generous pension programs.

"Of course, people like Cathy, who aren't members of pension plans, or like Jimmy, whose pension plan, frankly, is terrible, must do a great deal of saving. The same is true for frequent job-hoppers who do not stay with any one employer long enough to become vested in the various employer plans. The question obviously is, 'What are the best vehicles to use to accomplish our goals?'"

"That's why we're here, Roy," came Cathy's polite reminder.

"You may not know the vehicles' specific names or subtleties, but you already know our selection criteria."

Nothing sprang to my mind as Tom replaced me in the chair.

"We do?" Cathy said with puzzlement.

Roy remained silent.

Finally, lightning struck. "We want to choose vehicles that enable us to attain our long-term savings goals but which, at the same time, require the smallest ongoing sacrifices. 'Building for the future without killing the present,' to quote one of America's great financial minds." Cathy repeated Tom's earlier remark to wild applause from