2 ways to boost retirement savings

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

Are your clients ditching their 401(k) contributions?
There has been a 10-percentage-point increase in ownership of taxable brokerage accounts in the last five years, according to an article on MarketWatch. The number of checking, saving and CD accounts has risen nine percentage points. While ownership of employer-sponsored retirement plans was unchanged, contributions dropped five percentage points, as clients prioritize accounts for emergency spending. “When you think of the welfare of consumers, to encourage people to tie up assets until 20, 30, 40 years later is bad advice,” says an expert.

Social Security mistakes for clients with diabetes
A 64-year-old client who is suffering from Type 2 diabetes should weigh their options before filing for Social Security benefits, according to this article in the Los Angeles Times. While patients with diabetes have a shorter life span compared with those who don’t suffer from the illness, they are likely to live through their 70s. Delaying Social Security benefits past full retirement age is a good strategy to boost monthly payouts.

2 ways to boost retirement savings
Many clients are unaware they have the option of making catch-up contributions to retirement accounts, missing out on an opportunity to boost savings, according to this article on Motley Fool. Catch-up contributions are allowed for retirement savers who reach the age of 50. Another strategy to raise savings that many clients fail to take advantage of is the saver’s credit, which enables clients to save up to $1,000 yearly ($2,000 for married couples).

Clients should tap their IRA first for larger Social Security check
Clients who opted to file for Social Security early may end up with smaller retirement benefit payouts. They may not realize they have another option: tapping their IRAs for income to delay the benefits for bigger payouts, according to this CNBC article. “It seems like there is a significant portion of the population claiming early even though they have the potential to finance a delay,” says a researcher.

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