Clients can cover the rising costs of health care in retirement by opening a health savings account, according to this article on Motley Fool. HSAs offer tax breaks on contributions and qualified distributions, and tax-free growth on investments. Another option is to set up a Roth IRA, which provides tax-free distributions and greater flexibility.
Self-employed taxpayers who have no access to an employer-sponsored 401(k) plan can set up a solo 401(k), according to this article on MarketWatch. A solo 401(k) plan has the same eligibility rules, contribution limits, taxes on contributions and taxes on qualified distributions in retirement. One of the advantages of a solo 401(k) plan is that clients can opt for a traditional or a Roth account depending on the type of tax benefit they prefer.
Retirement savers can learn a lot of investment strategies from popular investor Warren Buffet, writes an investment advisor on Kiplinger. For Buffet, investors should never lose big money, writes the expert. "His point is to focus on protection, not just growth. Mr. Buffett is what is known as a 'value investor.' He buys companies, and their capability to earn money, rather than just looking at their prices."
A couple cannot both file a Social Security restricted application when they turn 66, according to this article on Forbes. One spouse should apply for his or her own retirement benefit so that the other spouse can file for a restricted application for spousal benefit on the spouse's record.
An expert says that opting for a lump sum pension payment from the military system could have a major drawback for retired service members, according to this article on Fox Business. For example, a retired service member with a monthly pension payout of $3,410 and 3% annual cost of living adjustment would get a lump sum of $157,250, but could have collected $372,978 in total monthly payments over 25 years, says the expert. "The promise of a lump sum that could total in the six figures will surely appeal to many service members. ...They may choose to take the upfront dollars with good intentions, but there are no guarantees."
