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

401(k) reform: A modest proposal
After the midterm elections, both sides have said they want to increase the cooperation within Congress, and in that spirit lawmakers may consider changes to improve employer-sponsored defined-contribution investment plans, writes John Rekenthaler, Morningstar's vice president of research.  The “relatively nonpartisan topic of retirement income” could help both sides with voters, he reasons. He proposes changing 401(k) plans by scrapping the fiduciary burden on employers and expanding the plans to include all workers. The proposal would lead to reduced costs for companies and more workers with retirement coverage, Rekenthaler says. -- Morningstar

Close to retirement? The recovery is working against you
A survey shows the widening gap in wealth between the rich and the poor, and this is because the wealthy people are those who typically gain from the rebound of the stock market, writes Dean Baker, co-director of the Center for Economic and Policy Research. Home prices also remain lower than the bubble levels, meaning middle class households have yet to experience growth in wealth, while most workers are unable to boost their savings because of sluggish wage growth and high unemployment rate, Baker says. This is bad news for pre-retirees, who "must rely on the wealth they have accumulated to date to support them in retirement."  -- Fortune

Need help with Medicare? Your options are few
Medicare beneficiaries face “substantial limitations” in information that they can use to compare the Medicare traditional and Advantage plans, and to make informed decisions, according to a study by the Kaiser Family Foundation. While retirees may visit the Medicare website to make the comparison, more research is needed. “Our findings highlight the gaps in available evidence and reinforce the potential value of strengthening available data and other support for tracking and monitoring performance across Medicare Advantage plans and traditional Medicare as each sector evolves,” the foundation says.  -- MarketWatch

Explaining the 10-year requirement for ex-spouse's benefits
A client needs to have been married to her ex-spouse for 10 full years to file for a spousal or survivor benefit on his Social Security record, according to this article on Forbes. If they have been divorced for less than a year, she could remarry her ex-spouse to complete the 10-year requirement and qualify for the benefit. Re-marriage, however, is not an option to reach the threshold if they have been divorced for more than a year as it would be treated as another marriage.  -- Forbes

Should you accept a lump-sum pension cashout?
Retirees are advised to refuse a lump-sum pension payment in exchange for a lifetime retirement income as they don't know how long they are going to live, according to an article on CBS Moneywatch. A lump-sum pension payment is a good option if they are sick and expect to have a shorter life span, or they are sure they will have a lifetime retirement income by investing the money. Also, for clients who worry over their pension plan's financial security, receiving a lump-sum payment of pension can be a good decision.  -- CBS Moneywatch

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