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

Low interest rates make immediate annuities attractive

Retirees who are better off with an immediate annuity are those who want to boost their current income stream and expect to have a long life span, according to this article on MarketWatch. Such an annuity offers as high as 10% in annual payout, higher compared with a non-immediate annuity, which offers up to 5% in annual withdrawal rate. The tax rates on immediate annuity payments are lower than other annuity types, since the payout rate is taken from tax-free principal and interest. Those who intend to buy an immediate annuity need not wait for interest rates to increase since keeping their assets in cash will not generate returns and any increase in interest rates could mean decline in bond prices. –MarketWatch

5 myths about IRAs

Contrary to what many retirement savers think, IRA investors need to know that they are not limited to investments offered by the financial institution where they open the account and they can include certificates of deposit, stocks, bonds and real estate, writes Ted Jenkin, co-CEO and founder of financial advisory firm oXYGen Financial. Many clients also think that they can’t contribute to a 401(k) and an IRA in the same year and that they are not allowed to open an IRA if they own a small business, which are misconceptions, Jenkin writes. Many others also make the mistake of thinking that only older people can contribute to IRAs and they can withdraw the money from the IRA without penalty if they reach the age of 59½. –The Wall Street Journal

3 things to know about Obama’s new MyRA retirement plan

The new MyRA retirement program announced by the federal government will benefit workers whose employers offer no retirement plan, but its features are not enough to help them secure their retirement, according to this article on Time Money. MyRA is intended as a starter account and its structure is somewhat similar to a Roth IRA. Maximum contribution to a MyRA account is $15,000 per year as the plan is designed to be “a bridge to private sector savings,” according to federal officials. –Time Money

Investing in real estate for retirement income

Real estate is a good investment option for retirement investors since it provides a steady and predictable income stream through the golden years, according to this article on Forbes. By investing in real estate, clients can protect their assets especially if the property has the right qualities, such as an advantageous location and a solid structure. Retirees who intend to invest in real estate to create an income stream are advised to consult a Registered Investment Advisor to minimize the risk and maximize the potential returns. –Forbes

5 tips for using dividend stocks to pay for retirement

Investors who intend to rely on dividend stocks for retirement income need to understand that dividends may decrease or even stop if company profits go south, according to this article in U.S. News & World Report. Those who will use this strategy will find diversification difficult since the companies that offer substantial dividends are in a few industries, although dividends are less volatile compared with stock valuations. Using dividend stocks for retirement income is tax-efficient and enables retirees to leave some wealth behind for their loved ones when they die. –Yahoo Finance

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