New Update: Healthcare Costs Increasing by Over 60% in Some States. Will you be impacted?

Essential 401(k) Insights for Fortune Brands Home & Security Employees Approaching Retirement

Healthcare Provider Update: Healthcare Provider for Fortune Brands Home & Security: Fortune Brands Home & Security typically collaborates with major healthcare insurance providers to offer employee health coverage, but specific details regarding their healthcare contracts can vary. Common providers for companies of their size often include UnitedHealthcare, Aetna, and Cigna. Potential Healthcare Cost Increases in 2026: As 2026 approaches, healthcare costs are expected to surge significantly, driven by a confluence of factors. The impending expiration of enhanced federal premium subsidies under the Affordable Care Act could exacerbate financial strain, with many consumers facing potential out-of-pocket premium increases exceeding 75%. Simultaneously, the overall rise in medical expenses-fueled by inflation in hospital and prescription drug costs-will compound the situation, prompting insurers to propose steep premium hikes. With these challenges, individuals and families may find themselves navigating a precarious financial landscape regarding their healthcare options. Click here to learn more

Fortune Brands Home & Security employees approaching retirement will find that managing their 401(k) accounts is a major factor in determining whther or not they will have a successful retirement. In the past, rolling over these funds into Individual Retirement Accounts (IRAs) has been the standard approach. The possibility of receiving advising fees from these rollovers has contributed to the recommendation of this counsel, which financial advisors frequently make. Recent evidence, however, suggests that this tendency is changing and that retirees are becoming more inclined to keep their assets in their 401(k) plans.

According to a thorough J.P. Morgan survey, 42% of participants in defined-contribution plans chose to retain their assets in their original plans for a maximum of three years after retirement. Compared to ten years ago, when the rate was less than half of that, this figure represents a huge increase. This conclusion was also supported by a Pew survey, which revealed that 35% of people approaching retirement intend to keep their investments in their current plans. The principal rationales ascribed to this decision are the caliber of investment alternatives, minimal costs, and general ease of use.

Financial consultants for Fortune Brands Home & Security retirement plans are aware of this changing tendency. A Pimco survey from 2021 indicates that, up from just 14% in 2015, 36% of retirement plan consulting firms actively encourage members to maintain their assets in their plans beyond retirement. This change is a component of a larger goal to maintain assets in plans, which lowers overall costs for all members. As part of these initiatives, numerous plans have improved their offerings for retirees by adding features like tailored advisory services, opportunities for rolling in outside assets, and educational materials.

It's critical for Fortune Brands Home & Security retirees to weigh a number of factors before deciding whether to keep their 401(k) or roll it over into an IRA:

The 401(k) Plan's Quality: Examining the available investment alternatives, related administrative and investment expenses, and other plan details are necessary to evaluate the quality of your 401(k). This may involve examining the investment lineup's performance and diversification, usually with the use of resources like Morningstar ratings. Examining any administrative expenses that can have an impact on the net return on investments is also crucial. The possibility of reduced costs in an IRA is a crucial point of comparison, particularly in light of the availability of inexpensive index funds and exchange-traded funds.
Early Access to Savings: Fortune Brands Home & Security 401(k) plans may provide more flexible options for retirees who may require early access to their savings, prior to the customary withdrawal age of 59.5. Unlike IRAs, which have a threshold of 59.5 years, many 401(k) plans permit penalty-free withdrawals after the age of 55, following employment termination. For people who plan to retire sooner than usual, this option can be quite helpful.
Withdrawal Flexibility: The alternatives for withdrawal are another important consideration. A 401(k) plan may restrict the ability to actively control asset allocation by requiring withdrawals to be made proportionately from all investments within the account. IRAs, on the other hand, usually provide retirees with greater flexibility by letting them decide which investments to sell off in order to meet their cash flow demands and keep a strategic asset balance.
Creditor Shields: Compared to IRAs, assets held in 401(k) plans have better legal manageability against creditors. For people in careers where litigation risk is higher or who could have credit issues, this can be a big benefit.
Employer Stock Considerations: If your 401(k) contains employer stock, it can be advantageous to keep the stock in the plan because of the favorable tax treatment on any improvement in value (sometimes referred to as net unrealized appreciation). If you roll over to an IRA, you may pay more taxes on the appreciation.

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401(k) Guardrails: Fiduciaries oversee 401(k) plans and are legally required to operate in the best interests of members, which frequently leads to a selection of diverse and conservative investing options. This can offer a degree of ease and security that people handling their own IRAs can't always match.

In conclusion, Fortune Brands Home & Security employee's decision to maintain or roll over their 401(k) to an IRA is mostly influenced by their unique financial circumstances, their retirement objectives, and the features of their existing plan. With the help of financial instruments and perhaps even a financial advisor's advice, people should carefully assess their situations as each choice has differences in benefits and concerns. Retirees can make selections that best suit their long-term financial health and retirement goals thanks to this careful consideration.

The significance of health care planning in addition to retirement funds has been highlighted by recent research, especially for individuals leaving large businesses. According to a 2022 Employee Benefit Research Institute study, retirees may require up to $300,000 to cover their medical costs in retirement, not including long-term care . Thus, it becomes essential to assess the available health savings accounts (HSAs) and other investment vehicles offered by the Fortune Brands Home & Security 401(k) plan. In their post-work years, retirees can preserve their lifestyle and financial stability while successfully managing health care costs thanks to this consideration (Employee Benefit Research Institute, 2022) .

Selecting the best route through a well-maintained garden maze is analogous to deciding what to do with your 401(k) after you retire. The most popular option has historically been a direct path, such as using the main, well trafficked pathway, that ends in an IRA rollover. But according to recent trends, a lot of people are now opting to take their time and delve into the nooks and crannies of their current 401(k) plans. This change is like finding peaceful, shady benches and interesting vistas that you've always known about but haven't often looked at. Whether you choose to convert to an IRA or remain in your 401(k), each route has its own set of attractions and rest areas, such as different investment alternatives, fee schedules, and withdrawal flexibility, all of which are essential to improving your travel across the retirement financial landscape.

Disclosure: There is no guarantee that asset allocation or diversification will enhance over all returns, outperform a non-diversified portfolio, nor ensure a profit or protect against a loss. Investing involves risk, including possible loss of principal.

With the current political climate we are in it is important to keep up with current news and remain knowledgeable about your benefits.

Fortune Brands Home & Security offers its employees both a pension plan and a 401(k) plan under the broader Fortune Brands Home & Security Retirement Savings Plan. This plan is a Defined Contribution Plan, allowing employees to participate in either a 401(k) or Profit-Sharing Plan. Fortune Brands Home & Security employees have access to a 401(k) Plan, where employee contributions are matched by the company at varying rates, depending on the employee's position and years of service (QDRO.com) (SimpleQDRO). The company offers automatic enrollment in the 401(k) plan, where employees are enrolled at a contribution rate of 3% of their salary. The contribution rate can increase by 1% annually until it reaches 6%, unless the employee opts out (SEC.gov). Additionally, Fortune Brands provides Profit-Sharing Contributions, which vary depending on the company division, and employees are vested in these contributions after three years of service. Employees who meet specific requirements, such as 10 years of service and attaining age 55, become fully vested in their 401(k) and profit-sharing accounts (SEC.gov). The vesting schedules for the pension and 401(k) plans depend on the employee’s years of service. Most employees achieve full vesting after three years of service, but for employees of divisions like Rohl and Fiberon, the vesting timeline can extend up to five years

News: In early 2024, Fortune Brands Home & Security announced a significant restructuring initiative aimed at streamlining operations and enhancing efficiency. The company revealed plans to reduce its workforce by approximately 5% as part of this strategic shift. Additionally, Fortune Brands is re-evaluating its employee benefits package, including potential changes to retirement plan offerings and adjustments to health benefits. Explanation: Given the current economic environment, where companies are reassessing their financial stability and operational efficiency, this news is crucial. Changes in employment and benefits could impact employees' financial planning, particularly in terms of retirement savings and healthcare costs. Understanding these adjustments is essential due to the broader economic and tax landscape, which could affect investment strategies and personal financial decisions.

Stock Options: FBHS provided stock options to key executives and senior management as part of their long-term incentive program. This was aimed at aligning the interests of executives with those of shareholders. RSUs: RSUs were granted to employees based on performance metrics and tenure. These units vest over a period of time, typically 3-4 years, contingent on continued employment and performance.

health benefits for Fortune Brands Home & Security. This will take some time to ensure accuracy and comprehensiveness. I’ll provide a summary once I have the details. In the meantime, if you have any specific aspects of their health benefits or recent employee healthcare news you're particularly interested in, please let me know!