Investments that should (and shouldn't) go into your client's IRA: Retirement Scan
Investments that should (and shouldn’t) go into your IRA
Investors can expect their investments to grow faster in IRAs than in taxable accounts because of the tax advantages, according to this article on Kiplinger. However, they should choose the investments that they hold in IRAs. High-yield or junk bonds, equities, real estate investment trusts are excellent investment options for IRAs. IRA investors should exclude municipal bonds, annuities and physical real estate investments from their portfolio.
The tax bill and your retirement savings: What’s in and what’s not
The Senate and House versions of the GOP tax proposal include provisions that would make retirement investors unable to "undo" their Roth IRA conversion, according to this article on The Wall Street Journal. Converting traditional IRA assets into a Roth is a strategy to reduce taxable income in retirement that could push investors to a higher tax bracket and lead to higher Medicare premiums. Under the bills, departing workers would have more time to repay their 401(k) loans, 401(k) participants could not contribute to 403(b) plans and seniors could expect a simplified income tax return.
7 ways to improve target-date funds
Target-date funds are a good investment option for retirees, but there are ways to further improve these funds, according to this article on MarketWatch. TDFs should exclude actively managed funds in their portfolios, scrap those unnecessary extra charges and include a more aggressive assemblage of equities for younger clients. TDFs should also get more small-cap funds and use all-equity portfolio for younger shareholders, as well as load up on value stocks for all shareholders.
The 2 words that could cost Medicare beneficiaries everything
Retirees should know that Medicare coverage is limited and does not include custodial care, according to this article on Motley Fool. Custodial care refers to routine services to assist older people in their daily activities. To close this gap, seniors who want to avoid out-of-pocket medical expenses should consider another source of coverage for custodial care or apply for Medicaid for nursing home care coverage.
We seniors are leaving money on the table... and maybe putting our health at risk
A survey by WellCare Health plans has found that only 40% of seniors are reviewing their Medicare plan before renewing the coverage, according to this article on Forbes. Moreover, only a third of older Americans are shopping around and comparing different plans during the open enrollment that ends Dec. 7 this year. This could put their health at risk as they may acquire new health issues and these illnesses are not covered by their current plan.