Why most Americans lack financial confidence in retirement
Welcome to Retirement Scan, our daily roundup of retirement news your clients may be talking about.
Why 73% of Americans lack financial confidence in retirement
Only 27% of Americans voiced confidence that they will remain financially stable in retirement, according to a poll by TIAA in this Motley Fool article. Clients who are unsure about their retirement security are advised to determine the amount of income they will receive from Social Security. They are also advised to max out contributions to their tax-advantaged savings vehicles and create a plan on how to cover their health care expenses in retirement.
3 ways bad health can ruin a client’s retirement
Clients need to keep themselves healthy, otherwise their retirement plans will be at risk, according to this Motley Fool article. Unhealthy clients may be forced to retire sooner than planned and could see an increase in health care expenses. They may be compelled to file for Social Security benefits early and reduce their benefit payouts permanently. Contributing to a health savings account is a great start to save for medical expenses and minimize the retirement risk.
Expenses that could derail your clients’ retirement
Clients who want to boost their retirement prospects should focus on housing, health care, debt and emergency costs, as these expenses pose a considerable risk to their retirement, a Forbes contributor writes. “The process starts with determining how much is enough, based on all of the individual expense estimates and appropriate amounts set aside for contingencies,” according to the expert. “That helps to ensure that you build an adequate savings account by the end of your working years.”
Do IRAs more flexibility than 401(k)s for clients
Although a 401(k) plan and a traditional IRA are both tax-deferred savings vehicles, the latter offers greater flexibility than the former, according to this article in Money. That's because IRA withdrawals will not be subject to a 10% penalty if the funds are used for major life and emergency expenses. Those who are considering this option should account for the tax consequences, as withdrawal are taxed as ordinary income.