Gov. M. Jodi Rell has unveiled a new proposal to fill a $1.3 billion hole in the 2011 budget, saying it scales back the amount Connecticut had planned to borrow.

Rell presented the alternative Wednesday to Democratic and Republican leaders of the General Assembly during a closed-door meeting. How to fill the hole is considered a key sticking point in reaching a deal on a revised budget for the fiscal year that begins July 1.

"I think it's a sound plan," Rell told reporters, following the meeting. "I hope we can get bipartisan support for it."

The two-year, $37.6 billion state budget passed in September intentionally left the $1.3 billion shortfall in the second fiscal year. Rell was supposed to fill the gap by borrowing against a future revenue stream, such as lottery proceeds, over 10 years.

However, the governor and the majority Democrats have not been able to agree on a particular revenue stream. [Read the full article]

Talks between Connecticut Gov. M. Jodi Rell's administration and state employee union leaders have broken down, with union officials saying the governor's early retirement proposal would decimate state services.

Representatives for the Republican governor and the State Employees Bargaining Agent Coalition met privately Wednesday night.

The union coalition said Rell's representatives abruptly left the meeting. SEBAC believes Rell needs union approval before offering an early retirement program to save an estimated $65 million.

Rell's office said the governor is extremely disappointed SEBAC "summarily rejected any consideration of an early retirement plan" and the union leaders would not consider other cost-saving measures. [Read the full article]

Your 401(k) plan options probably include at least one target-date fund. Some financial planners tout these funds as a way to keep your portfolio appropriately allocated throughout your working career all the way to retirement. But others think they're a disaster. Who's right?Ch. 1: Get your plan togetherNew trends in retirement plans3 steps to building retirement savingsBuy and hold vs. active managementThe art of naming IRA beneficiariesWhat to know about target-date fundsChapter1234ALL

First, a brief primer: Target-date funds are composed of several funds representing different investment styles or asset classes. As their name suggests, they have a target date, such as 2020 or 2040, for retirement (or in the case of 529 plans, for college matriculation). The investment firms running these funds make the asset allocation decisions on behalf of investors based on the target date.Is simpler better?Ronald J. [Read the full article]

If you want to put as much money as possible into retirement but need a solid emergency fund in case of job loss, your Roth IRA could do double duty.

An often-forgotten benefit of the Roth IRA is that you can withdraw from your own contributions any time, without a tax or penalty. You paid tax on that money before it went into your IRA so there's no additional tax or penalty to withdraw it, says Jean Keener, a Chartered Retirement Planning Counselor in Keller, Texas.

First, it's still smart to have some cash readily available in a savings account for small emergencies, like a roof leak or unexpected car repair, suggests Keener. After that, consider parking additional rainy-day money in your Roth IRA to let that money grow tax-free for retirement as well as play a supporting role as a backup emergency fund.

"If you plan to use your Roth as part of your emergency fund, you would invest it differently than money for retirement," says Keener. [Read the full article]