Report: Retiring Baby Boomers Expected to Hurt U.S. Companies

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More than 25 percent of U.S. businesses have done little to plan for the effects of an aging workforce, according to a new national study.

Over the next decade, there will be a significant change in the demographics of America's workforce as baby boomers continue to retire, leaving younger workers with less experience to fill their place -- and leaving many businesses unprepared.

In a survey of 578 organizations of varying industries in the United States, only 33 percent of employers said that their business had analyzed workplace demographics and made projections about the retirement rates of their workers, according to the Boston College Center on Aging and Work.

Reports indicate that U.S. businesses face a shortage of millions of workers in the next 10 years due to the baby-boomer generation approaching retirement.

"Companies that do not plan for this aging workforce may find themselves suddenly faced with a loss of labor, experience and expertise that will be difficult to offset, given the relatively small pool of new workers and the competition for new talent likely to result from so many companies facing the same problem," Mick Smyer, co-director of the Center on Aging and Works, said in statement.

Only 37 percent of employers said they have adopted strategies to encourage older workers to stay past the traditional retirement age, despite more than 50 percent of employers who said they value the "loyalty, reliability, and strong work ethic" of their late-career workers, researchers found.

Many respondents acknowledged that they will face challenges when it comes to replacing retired employees. Almost 60 percent of employers reported that recruiting competent job applicants is their biggest human resources challenge. Respondents also indicated a concern for competent employees leaving and causing a skills gap at the company. Forty percent said that management skills would be the asset in shortest supply at their organization.

Researchers found that employers would be effective at retaining retirement-age workers if they offered more flexible work options. When asked to what extent their organization had implemented flexible work options, 7.6 percent responded that they had "not at all," while another 33.8 percent had only done so to a "limited extent."

"Most older workers who say that they want to extend the number of years they remain in the labor force also say that the typical 8-hour day/5-day week doesn't work for them," said Marcie Pitt-Catsouphes, co-director of the Center on Aging and Work. "Employers who fail to consider flexible work options may be missing important opportunities to enhance both their business performance and their employees' engagement."

[via inc.com]
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New Rules for Retirement Plans

http://eat-healthy-every-day.blogspot.com/

I own a small S-corporation and I would like to set up a retirement plan for myself and perhaps eventually for any future employees. I am married, filing jointly, and we have about $200,000 in annual income—the majority of which comes from my spouse's job. What are my options for opening an IRA or 401(k) plan through my business? I'm very confused about the new laws.

—F.E., Long Island, N.Y.

You're not alone. A recent survey conducted by PricewaterhouseCoopers Private Company Services (PCS) showed that a majority of chief executive officers of the nation's fastest-growing private firms are not knowledgeable about the 2006 Pension Reform Act guidelines that took effect on Jan. 1. And although the legislation creates an automatic enrollment feature for employees, only 5% of the CEOs surveyed planned to take advantage of that feature.

"The pension reform act was passed to help companies boost plan participation and do right by their employees," says Paul Bracaglia, investment advisory partner with PCS. "The lack of knowledge regarding the new guidelines means that…companies are not taking advantage of the opportunity to provide employees with the best options available to help them save for retirement."

Most Popular Plans

For an entrepreneur with no employees, a solo 401(k) plan tends to be the simplest and least expensive retirement plan to administer, experts say. However, you should research your options thoroughly, particularly if you are considering adding employees as your company grows. Talk to your accountant or tax preparer about the various retirement plans available.

If your CPA is not knowledgeable about the topic, she or he will likely be able to refer you to someone who is. Be aware, however, that it's always smart to get a couple of opinions. Some of the plans out there will not be right for you, depending on your age, how many years you have before you plan to retire, and the additional retirement resources you and your spouse have already accumulated.

The 401(k) plan is the most popular pension plan in use in the U.S. today, according to the Internal Revenue Service. The PCS survey, which targets the fastest growing entrepreneurial and family-owned firms, showed that 92% of respondents offer retirement plans, and 85% of them offer 401(k)s. Nationally, smaller firms and startups are less likely to offer retirement plans for their employees.

Background Check

Many companies—80% in the PCS survey—retain independent investment advisers to manage their plans and complete the paperwork involved, which can be substantial. Firms that do this kind of work include: third-party administrators, brokerage firms, benefits consulting firms, banks, and accounting firms. You can find more information on many of them online but again, talk to more than one provider. You may find that some groups charge far more than others to do the same work, and you also want to ensure that any adviser you hire is independent and not selling the investments she recommends.

"Ensuring that the investment advisory firm is independent involves scrutinizing the adviser's accreditation, fee structure, and investment methodologies and philosophies," says Bracaglia. "Company owners want to make sure that the adviser is bias-free; for example, has no financial compensation tied to the plan assets. Every company should ask to review its investment adviser's Part II of Form ADV which is filed with the SEC [Securities & Exchange Commission] to determine precisely how the firm is compensated. An investment adviser [who is] is paid solely for advice creates a relationship that will be truly independent."

For more information on 401(k)s, visit the IRS Web site, www.irs.gov/retirement/article/0,,id=120298,00.html, the U.S. Department of Labor Web site, www.dol.gov/ebsa/publications/401kplans.html. Details on the PCS survey can be found at www.barometersurveys.com.

Karen E. Klein is a Los Angeles-based writer who covers entrepreneurship and small-business issues.

[via businessweek.com]

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The 10 Commandments of a Great Business Name

George lopez Latin kings of comedy

What's in a business name? Everything and nothing. The right business name will help distinguish you from a sea of bland competitors, provide your customers with a reason to hire you, and aid in the branding of your company. A business name won't make up for serious deficiency in your business operations or help you avoid selling. Apply these 10 commandments when choosing a name for your business.

1. Take Naming Seriously: Naming your business or products is a serious matter. The name you choose can play an integral part in the marketing of your company. Your name projects your image, brand, and position in the marketplace.

2. Avoid Word Play Dangers: Taking the word play strategy will add to the difficulty in having customers remember and find you. Being cute can backfire.

Funnynames.com lists the following actual "businesses to avoid:"

Ear-Resistible Designs Plus

Dirty Ernies Paragon Hotel

Fireball Oven Co

Mess Graphics Inc

Ralph Rotten's Nut Pound

X-Ray Sweaters

3. Don't be an IBM: It's tempting to abbreviate your business name to make communications and correspondence easier. However, as a small business owner you don't have the resources and marketing muscle to educate your market on what your acronym means.

4. Be Focused: Forget tagging your business name with the moniker such as global or enterprise. Any start-up founder has big visions for their company. You might one day envision marketing to diverse markets and having a wide range of products. Successful start-ups have limited time and money; it's more likely your success in the world of commerce will come from being highly focused in one narrow area. A small company is a specialist; it's why your customer wants you.

5. Stay Out of Court: Don't use, borrow, or modify an existing famous brand name. In Elizabethtown, Kentucky, Victor Moseley used the name Victor's Secret when he opened his adult gift and lingerie shop. Victor's Secret did not remain secret when the legal department of Victoria's Secret sent a letter to Moseley claiming trademark infringement. In haste, the name was changed to Victor's Little Secret, but the change was not enough for Victoria's Secret who then filed a lawsuit.

6. Think Beyond Local: The bulk of small businesses operate in local markets. This doesn't mean your name should be geographically based. If you are marketing to customers in a local market, they'll know you operate locally. Adding your town name to your business name just ensures you will be stuck in a long directory list of other local companies with similar names. If you want a local name, add it to your marketing such as "Exclusively Serving the (town) Area."

7. Avoid ME Inc: It's a common tendency for a business to be named after the original founder. If you are planning to one day sell your company, a company owner named business is less attractive to a perspective buyer's than a brand built on a company.

8. Ask Others to Spell it: When I started one of my companies and named it Insightica, it was unique enough but it drove me crazy the number of times I was asked to spell it. The word could be spelled with site or sight. Put your business name through the spelling test and ask others to spell it. Yourdictionary.com lists experience, intelligence, jewelry, millennium, and personnel as a few of the top 100 most misspelled words.

9. Be Web Friendly: Consumers are bombarded with business names and advertising on a daily basis. Your job as a successful small business is to make customers remember you. Your website web address should be the same as your business name. Avoid the hyphenated web address names. It's hard enough to remember a web site address without the hyphens.

10. Check Availability: When you have developed a great business name, spend the time to determine if another business isn't using it. You can use a similar name for your business if another company uses it in an unrelated market or industry. Once you have your name, protect it by registering the business name with your county or State office.

Your business name should be easy to remember and memorable. Apply the 10 commandments when naming your business and in the end you'll avoid a marketing disaster.

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