As workers save for retirement, remember these 6 key HSA features
Welcome to Retirement Scan, our daily roundup of retirement news.
Tips to prepare retirees’ finances for retirement abroad
Seniors who consider retiring overseas are advised to have bank accounts in the U.S. that allow fee-free ATM withdrawals abroad, as they may have a hard time opening a bank account in their new home country, according to this article on CNBC. They also should review the tax treaty between the U.S. and their new country so they will determine where they should pay the tax bill on their retirement income. Retirees who relocate abroad should weigh their options before investing overseas, while those who decide to work won’t pay federal taxed on their wage earnings because of the foreign earned income exclusion.
As employees save for retirement, remember these 6 key things about health savings accounts
A health savings account can be a great savings vehicle for people who are preparing financially for retirement, according to this article on USA Today. An HSA is funded with tax-deductible dollars, offers tax-free growth on investments and provides tax-exempt withdrawals for qualified medical expenses. HSA holders also do not have to take required minimum distributions when they reach a certain age. To maximize the account, workers should not dip into their HSA savings to pay for current medical expenses, shop around to get the best provider and contribute as much as they qualify Medicare coverage, as they can no longer make HSA contributions once they are covered by the program.
15% of Americans need a serious retirement wake-up call
A study by Northwestern Mutual has found that the percentage of Americans with no retirement savings decreased to 15% this year from 21% recorded last year, according to this article on Fox Business. Despite the decrease, the findings still mean that millions of Americans have not saved for retirement and should start building their nest egg to secure their golden years. Saving for retirement is needed because Social Security benefits will not be enough to cover their costs in retirement, especially the rising cost of healthcare.
America has the widest retirement savings gap of these developed nations — and it’s only going to get worse
The disparity between what Americans should have saved for retirement and what they actually saved is expected to expand to $137 trillion by 2050 from $28 trillion in 2015, according to this article on MarketWatch, citing data from World Economic Forum. The gap grows $3 trillion annually, data from the nonprofit research organization also show. Male retirees in the U.S. are likely to outlive their savings by eight years, while their female counterparts could outlive theirs by more than 10 years.