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Older Americans rely too much on Social Security as a main source of income

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Welcome to Retirement Scan, our daily roundup of retirement news your clients may be talking about.

Older Americans rely too much on Social Security as a main source of income
A survey by Nationwide Retirement Institute has found that 47% of people aged 50 and above consider Social Security a primary source of income in the golden years, according to this article from USA Today. Twenty-six percent of the respondents also believed that income from Social Security would be enough to secure their retirement, the survey also found. “The misconceptions about Social Security are alarming. If you think about how many are relying on Social Security to be their main source of income, it really is scary,” says an expert with Nationwide.

What happens when you are forced to retire early?
Pre-retirees are advised to build an emergency fund to prepare for a forced early retirement, according to this article from Fox Business. To prepare for this possibility, clients should have at least three to six months’ worth of emergency savings and hold the funds in a money market account, says an expert. “There are all kinds of plans and options out there. Don’t sit back and not be informed. Engage with an insurance professional so you can understand what’s out there. Or what are some gaps in your coverage that you may need to purchase an additional policy to be able to protect yourself and your family.”

A volatile market may move back your retirement date – but don't despair
Investors are advised to evaluate and reduce their risk exposure to protect their retirement portfolio from a market correction, writes an expert for Kiplinger. They should also avoid making emotional decisions, get a second opinion from another expert and adopt a smart strategy for investing in bonds, the expert says. “With a proper plan in place, people can work toward retiring on schedule, regardless of the market volatility of the time.”

Ask Larry: Will I lose COLAs if I wait till 70 to claim my Social Security retirement benefits?
Seniors who delay their Social Security retirement benefits until the age of 70 will receive all Social Security cost-of-living adjustments that occurred since the year they turned 62, according to this Q&A article from Forbes. They will also incur delayed retirement credits that can raise their benefit payouts by 24% to 32% depending on their full retirement age.

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