A 3-step Social Security emergency plan
In the face of Social Security's long-term financial issues, investing in high-quality, dividend-paying stocks is key to a comfortable life in retirement, according to this article on Nasdaq. If Congress does not act to shore up Social Security, starting in 2034 benefits checks will be 73% of what they are now. So with that in mind, when developing an emergency plan to offset that potential impact on on retirement income, clients are advised to identify their needs, start saving as soon as they can, and rebalance their investment portfolio every year.
How does raising children affect retirement risk?
A study by researchers at Boston College's Center for Retirement Research has found that a child increases the retirement risk of households in their 50s by two percentage points, according to this article on MarketWatch. "Each kid reduces household income by about 4% for households in their 30s, but the percentage reduction declines to virtually zero for older households," writes Alicia H. Munnell, the center's director. "This pattern is consistent with the notion that mothers of young children reduce their labor force effort for a time and then return to work."
Clients retired too early? Here's what they can do
Retirees who think that they left the labor force too early have options to fix their problems, according to this article on personal finance website Motley Fool. For example, for cash-strapped retirees, they may opt to work on a part-time basis, downsize, and giving up an extra vehicle. Those who are getting bored may want to engage in volunteering work, go back to school, or launch their own business.
How clients can retire comfortably, even if they’re not geniuses
Young people should consider taking an associate degree instead of a college degree to avoid a hefty student loan debt that could prevent them from saving enough for retirement, according to this column from the Chicago Tribune. They should also put retirement savings ahead of saving for their child's college education. Finally, they should also stick to a spending plan to ensure that there would be money to sock away in their retirement accounts.
2 things people get wrong about retirement
A survey by Nationwide suggests that many seniors are disappointed with their life after retirement, as they overestimate their future retirement income and their health, according to this article on Money. A majority of those who had a medical condition said their illness started more than five years sooner than anticipated. “Many people think their health will maintain where it is currently, and they are surprised when they start experiencing issues earlier than expected. It really affects their happiness in retirement,” says an expert with Nationwide.
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