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

Planning for retirement: Should clients pay off the house early?
Seniors need to take a number of factors into account to determine whether they should pay off their mortgage or carry the debt into retirement, according to this article from Kiplinger. The new tax law has nearly doubled the standard deduction and limits the deduction for state and local taxes, making it less likely for taxpayers to itemize their deductions. From a tax perspective, this means that paying off the loan usually will be a more sensible option.

Bloomberg News


How the tax changes affect retirees' bills
Using last year's tax bill is an easy strategy to determine the tax liability for the current year, but such an option may not make sense as many retirees are likely to see their taxes decrease because of tax reform, according to this article on Morningstar. This could result in a hefty tax refund, which is not an optimal way of using their earnings. Another option is to estimate their tax bill based on projected earnings for the current year and have the tax payments withheld from certain income payments such as Social Security or pension plans, says the expert.

IRA vs. 401(k) vs. HSA: Which is the best way to save for retirement?
IRAs and 401(k)s are great savings vehicles for clients who want to build their nest egg because of the tax benefits that these accounts offer, according to this article on personal finance website Motley Fool. Although a health savings account is meant to cover medical expenses, it can also be a good place to save for retirement, as it offers tax deductibility on contributions, tax-deferred growth on savings and tax-free withdrawals for qualified health-related expenses.

Social Security: Will I not get spousal benefits because of state retirement pension?
A senior who will receive a state retirement pension can expect reduced or no Social Security spousal benefits on her spouse's record because of the Government Pension Offset program, according to this article on USA Today. Her spousal benefits could be reduced by two-thirds of her state pension, says an expert. “What’s more, if your pension is high enough, this two-thirds reduction could eliminate all spousal benefits that might be available to you.”

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